TraderWise

Alpha Natural Resources (ANR) is my favorite coal stock based on 2009 earnings potential; we own 4. However it's stuck in a long drama with it's current merge (fighting a hedge fund to be allowed to merge of all things)

Well apparently I caught the "coal train" much too late this year, unlike 2007 when I was early. The coal stocks and 'related fare' have had a few rough weeks... as of late last week both Alpha Natural Resources (ANR) and mining equipment maker Bucyrus (BUCY) had broken support on their charts, so I am going to close out the last of each position, both are 0.5%-0.6%ish type of exposures. 5% loss on the former and 7% on the latter.

It's been a while since we've looked at the coal space - we own one name as a small position, but this was a theme that was one of our big winners in late 2007 and 1st half 2008. Further, we made a strategic shift from thermal coal to metallurgical coal in the spring of 2008 just before the companies with an emphasis on metallurgical made a huge surge. Alpha Natural Resources (ANR) was our top dog - just imagine the joy we felt as one of our top positions was in the news as a source of a buyout offer by iron ore company Cleveland Cliffs (CLF).

Alpha Natural Resources (NYSE:ANR) has sold its majority interest in lime manufacturing plant in Kentucky and 17.6 million tons of coal that still needs to be mined.

We've been discussing coking coal a lot of late, and when I sold Potash this was one sector (the other being iron ore) I wanted to offset that sale by going into.  However, the stocks involved have simply been on fire, and most days you have to chase just to be involved.  Of the major met coal stocks, Alpha Natural Resources (ANR) is the one that has lagged a bit, and is now the closest to a support area so I will throw in the towel and "kind of" chase it here around $50.50.  I am beginning with only a 1% allocation - I'd rather buy more in the $46 to $49 range but at thi

Is that an ABC pattern in the $USD Dollar index ?
A quick reminder of what is the "ABC pattern"
1) After a long down trend, price suddenly zooms up, breaks the down trend, and finds a resistance level (we call it our "A")

I am going to replace mining giant BHP Billiton (BHP) - one of our longest held holdings - with a much less diversified name, Massey Energy (MEE) now that the stock has finally come in.  This name was my preferred choice in the space after it's recent acquisition [Mar 17, 2010: Massey Energy Seeks to Double Metallurgical Coal sales with Purchase of Cumberland Resources] but instead I began a stake in Alpha Natural Resources (ANR) last week.

In response to pressing demand for energy and the need to better utilize valuable natural resources while reducing environmental harm, China is encouraging all forms of alternative renewable fuels and environment-friendly fossil fuels.   The abundance of coal resources in the Asian continent and a dearth of oil reserves has made coal China’s fuel source of choice. 

After consolidating a large move, Priceline.com (PCLN) was trading under $246 for a few weeks.  That level was breached today, and you can see the power of the "breakout" trade below. 

Which is why you don't want to be shorting anything that breaks out of a consolidation pattern....