Friday, 30 May 2014

ANR, BTU - coal miners still digging deeper

Despite the main equity market building gains into months end, the coal miners remain an especially battered sector. Alpha Natural Resources (ANR) and Peabody Energy (BTU) ended the week badly, -5.1% and -3.2% respectively.

ANR, daily

BTU, daily


The daily charts look bad, but...the monthly cycles really put things in perspective...

*please note, the upside targets are 'on HOLD', but I thought I'd leave them on the charts...

ANR, monthly

BTU, monthly

I remain cautious about ANR (in terms of possibly imploding), although I have much greater concern about Arch Coal (ACI) and Walter Energy (WLT).

I am still bullish in the long term for coal, after all it remains a relatively cheap and plentiful resource, and at some point, even the US Govt' will cease trying to curtail its use.

I have no interest in picking up any mining stocks in the immediate term, not least since I still believe Gold will eventually break into the low $1000s..perhaps the 900s. Until the precious metal prices floor..the mining stocks are not going to be able to begin a new multi-year ramp.