Market-Technicals

Financial Market Analysis

By Shawn R. Carpenter

Thursday, November 30, 2006
  Everyone is getting coal for Xmas


Everyone has been put on the naughty list....

And if so, you might make some $$$$

The energy sector has been putting up some good numbers as the price of oil rises of it's pullback from this summer's highs. Looking deeper into the sector, coal has been outperforming the last couple of trading sessions. Take a look at the Coal Group. Recent declines in line with the price of oil has left this group in oversold territory. With the downward trend already panned out, we are starting to see a rally off of the lows. Fibonacci retracements suggests prices could rally up to 399.012 (38.2% retracement from the high), followed by 428.846 (50%), and 458.679 (61.8%).
The best play in the space would be Peabody Energy (BTU). Looking at the BTU above, it almost mimics the groups. Look for Fibonacci retracements to be at 49.26 (38.2%), followed by 53.95 (50%), and 58.65 (68.1%). While I have given the 68.1% retracement levels on both, the main focus of this play should be taken to the 50% retracement levels. Selling at these levels would be highly suggested.

Names also to consider in this group would be:
ACI - Arch Coal Inc.
YCZ - Yanzhou Coal Mining Company
MEE - Massey Energy Co.
ANR - Alpha Natural Resources Inc.
 
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Market-Technicals is a Financial Market Trend and Research blog. Mainly utilizing technical analysis, the research composed is designed to capture market timing techniques, understanding how economic and political forces shape the market, and give speculation as to where the financial market is headed. Encompasing equities, index, sector, ETFs, commodities, and bonds; the expectations are to shed some light as to what "smart money" is thinking.
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