PowerShares WilderHill Clean Energy (PBW)

Company

PBW 1-year chart PBW 1-year chart

"The PowerShares WilderHill Clean Energy Portfolio (Fund) seeks to replicate, before fees and expenses, the WilderHill Clean Energy Index, which is designed to deliver capital appreciation through the selection of companies that focus on greener and generally renewable sources of energy and technologies that facilitate cleaner energy." (company website)

PBW 6-month chart
PBW 6-month chart

Buy

Having battled BLDP to a draw and banking a very, very modest profit on FCEL, I decided to try spreading the risk around by investing in PowerShares EFT for alternative energy stocks. I'm going to just sit on them for a while and see what happens. It has been in an uptrend since the beginning of the year.

  • Price momentum (PPO) — declined earlier in May but picked up again this week
  • Relative strength (RSI) — about neutral for past month
  • Trend (ADX) — at threshhold (20) with buying pressure (+DI) a bit less than selling pressure (-DI)
  • Volume — up and down

Sell

gain Bottom line
15%

PBW has been very good to me. Since buying it, is it rose more than $3 per share, but has begun to fall back. Relataive strength (RSI), momentum (PPO), and buying pressure (+DI) have all dipped sharply, and so I suspect this is the start of a sizeable correction; this would not be surprising, since PBW is quite a ways ahead of the 50-day moving average. With all the volatility in the market, this seems like a good time to move to the sidelines after taking a nice profit.