Coal

Coal prices are cheap.

I am done trading for the year. I will probably return early or mid January.

A quick look at coals

Going through all the charts, the coals look very messy. Some look like they are trying to form a bottom, some look like they want to head lower. The only things I would consider here are day trades, preferabbly longs on stocks that have been hit the hardest (MEE, CNX, PCX, ACI). There is nothing long term here, too volatile and unpredictable.

Oil, what is going on?

I am not going to talk about the difference between the front month oil contracts and the Nov ones. But I did find that the strength in crude was very weakly reflected in energy stocks. Crude was +6% today, which is a pretty big move, yet OIH was -.1%! What does this mean? Well, it means that the energy stocks were being thrown away with the rest of the market.

I had a great time going long coal today, and thankfully I am a day trader and took my profits as soon I got them. As oil hit the high of day (HOD), coals really began to rally. But soon they were pulling back, nice and healthy. Until they gave most of it back and closed pretty flat! +6% oil, and flat coal stocks?

My guess is coals will be choppy here. Don't be long, don't be short. Play intraday swings. Don't buy break outs, don't sell break downs. Buy the dips with small size and sell the rips.

Also, something has to be fixed here. Oil can't keep going up with the oil stocks, so which will correct? My guess: crude is headed back to the mid 90s. Expect the 'world slowdown' story to pop up again as a reason for crude to head lower.

Coal

FYI, I live in CA, so I make a lot of posts 8-10pm, which is 11pm-1am eastern. Sorry for east coast people.
I got whipped around today. Tried to go long coal, chased the open, got burned, shorted ACI made some money back, end of day went long coal made money. I think I love to trade coal too much. All coals ended in the green. JRCC +11%, PCX +10%, CNX +8%, ACI +7%.

MEE was only +3%, it should still have room to run.


I also still like CNX, PCX, ACI, BTU, JRCC

Coal

I will be buying the coals tomorrow, but with very tight stops. These are great stocks to day trade if you know which direction they will go. The oversold ones would be the most optimal plays. The action today was crazy: opened strong, sold off with crude, rallied towards the end, sold off big at the very end. The only way you can make money here is to be very defensive and sell whenever you have any significant profit.

I *hope* an upward trend develops soon, but I would not be willing to lose money if this does not happen. I would rather make a little bit of money and watch a stock run off than to turn my gains into loses. There is absolutely no momentum in stocks in this market.

UPDATE: Oil is now trading higher after hours at 97.5, it closed at 96.6. If it can keep this up tomorrow, coals should be solid.

Oil on fire - play the coal

I said "Energy feels like it wants to rally." in my previous post. Mid day I thought I was early and maybe later this week. Supply numbers drove crude down. Then later in the day a huge rally. Right now oil is +6.6% and a lot of the coal stocks I mentioned are working back to green. The oversold ones look very tempting here.

One note: gasoline does not seem to be rally that much, but refiners holding up well.

Coals

Energy feels like it wants to rally. My favorite sector to invest in is coal. Here are a few stocks that are oversold.

ACI

35 has proven to be support, it is now red for the year. I am long.

BTU

45 has proven to be support, it is now in the red. It can easily run up to 55.

CLF

70 is support, this stock has held up very well compared to other coals. A move to 85 looks possible. I am long.

CNX

50 is support. It is red for the year. I want to get long with strength tomorrow.

MEE

35 is support and the low end of the trendline. A run to high 40s is foreseeable.

PCX

30 is support. A move to 40 is very possible.

CLF H&S

Coals are in trouble, CLF has a H&S formation. It has also recently made a bid to merge with ANR. The deal is currently being challenged by the largest shareholder so news on this could significantly impact the stock. The announce of the deal brought CLF down huge, so if the deal is prevented, it MIGHT be a positive for the stock.

Coal

Coal is zoom zoom zoooming. Which stocks have more to run?

ACI

Ascending triangle, breakout above 55 would give it new all time highs. Need increase in volume!

ANR

Broke out above the 40 level, I would wait for a test of the 20 DMA before getting in.

BUCY

Testing strong resistance at 105. Breakout with high volume will lead to new highs.

PCL

This one just broke into new highs. The great thing about this stock is that it has been going sideways for a few days now and is very close to its 20 DMA. Either a pullback to 55 would make an attractive buy or blast to new highs on higher volume.

JRCC

Moving sideways right at the new highs. Previous patterns suggest that there will be a pullback before we proceed to new highs. A pullback to 20 DMA or even lower would provide ideal entry.

PCX

This has run up straight for a month and is very extended. There is no support and no resistance so I have no clue what to do without a pullback to the 20 DMA.