Tsx CTL.TO Thread

[Naamplao]

I believe that diversity is the key to survival in the stock market, especially in times of uncertainty as we see today. The paper industry is one that has seen a huge downturn due to the reduced need for newsprint.

I have been looking for an inexpensive play in this industry and think I have finally found one in Catalyst Paper Corporation...here is a description of the company

Catalyst is a leading producer of mechanical printing papers, headquartered in Richmond, British Columbia, Canada. The company also produces market kraft pulp and owns Western Canada's largest paper recycling facility. With six mills strategically located within western North America, Catalyst has a combined annual capacity of 2.8 million tonnes of product. Catalyst's common shares trade on the Toronto Stock Exchange under the symbol CTL.

I also like the "green" aspect of this company, as it has a plant to harvest the "urban forest". I believe it has recently purchased a similar plant in Arizona.

Here is my SharpChart for the company

CTL.TO - SharpCharts from StockCharts.com

The first thing that grabs your eye is the dramatic drop in the share price in March...what was going on? Well there was a "rights offering" where current holders of Catalyst shares could buy a new share at $0.75 ....this drove the price from $1.60 down to $0.80...

Catalyst Paper announces details of Rights Offering: Financial News - Yahoo! Finance

But now the offer has ended and the share price is rising to its old level it seems.

Note that the Accum/Dist shows NO dramatic selloff by the share holders during this dramatic drop in price!!! Now that the offer is over...look at the huge jump in the Accum/Dist since that time...a good sign IMHO.

Now look at the Bollinger Bands.....very very tight now...Also the price is currently above the upper BB...there will be a huge jump in share price coming probably on Monday.

Note that the share price is about to recross the 50dayMA Always a good sign...the RSI looks to be about to surge from 50% too. The TRIX is positive...it is all good!!!

Here is the P&F graph



First of all, the chart looked like it was starting to recover before this Rights Offering. We have an "ascending triple top breakout"...very bullish. We have no resistance levels until we see the pre-rights levels...I see the resistance is at $1.66/share ...with the current price at $1.10 that is a 30% increase.

Here is the Yahoo.com 5 day line chart



It looks to me that we are poised for a nice jump here on Monday

I think I have finally found my inexpensive Paper Industry play.