#STOCKS – “Trump loves coal…”

The President claims he loves coal and coal miners.

Outside of Florida, he runs most often to West Virginia to rally his supporters.

Evidently, the West Virginia voters have been so poor and uneducated for so long, they will believe anything his says. I’m probably being too harsh on these unfortunate folks but it’s way past time they wised up. To have Trump on your side is to have worse than having no one.

Except for his Russian money-laundering real-estate businesses, this self-described master deal maker and businessman has managed to run through everything he inherited from his dad and a few billion more, bankrupting almost everything he’s touched along the way – casinos, steaks, champagne, a university, and so and so on (to say nothing of his marriages and his money spent to shut up porn stars and playmates).

Without the Russians, he could be going broke right now hawking hot dogs from a cart on a street corner in New York.

But enough of my admiration for greatest con man of all time, let’s get down to the stock market and the coal stocks.

While Trump says he loves coal, as anyone who has bumped into my posts on Trader-Talk over the years knows, there may be no one who loves shorting coal stocks more than me.

I’ve shorted Walter Energy (WLT) off the board. That was a lot of fun as nearly every coal sector analyst kept reiterating “buys” at every price level from $85 a share to $1.50. At $1.50, the analysts finally said sell. Believe it! Hopefully all those fools (or are they liars and thieves?) are out of the securities industry but probably not (Trump is President, after all, no matter what).

Over the years, so many coal companies have gone belly-up, killed by natural gas, environmental activists, and finally the worldwide recognition of climate change, it was almost as if one could throw darts at the sector and whatever the dart hit would die.

Two of the most prominent were Peabody Energy (BTU), “the biggest coal company in the world,” and Arch Coal (ARCH).

Both companies, BTU and ARCH (and also the not-great Cloud Peak Energy), came to the port town where I live in a desperate attempt to ship coal to China where my neighbors, along with everyone on the West Coast, shut them down, a failure that led to both companies filing for bankruptcy and its consequent loss of all shareholder equity. They both reorganized, returned to the big board, and long came Trump to sit down beside them and give them hope…for about a year. Even subsidy plums can’t save a dying fruit tree.

Both companies are now well on their way to burning through all shareholder equity again. I can’t imagine who squanders investments on this dead-end stuff anymore.

See the pitiful charts below. Both stocks, like the market, are so oversold they will probably a bounce here. If so, they are shorts…again.

Once BTU drops below $5 (it closed today at $5.50, down from $30 or so in just the last year), the nails in its coffin will soon follow. ARCH has a lot more price downside (see the second chart below) and it will take some time but it will get to cliff BTU is standing on too.

(click on the charts for a larger view)

#CoalStocks – thinking about shorting BTU, CLD…again.

Just thinking about it. This is a heads up. Don’t quite have the triggers I’d be comfortable with yet.

But unless the stocks surprise further to the upside, the prospects for shorting them again are getting closer day by day.

These stocks have been rallying in recent months on the desperate hope President Trump will do something to revive the industry. There is no chance of that happening. He is paying lip service, but is hardly interested or able to do anything else. Remember these stocks, long term, have fallen faster than dead canaries. This is an industry slammed by cheaper cleaner natural gas and it is facing an inevitable death at the hands of renewable energy.

CLD, once the stock dropped below $5 a share, could easily fade to dead money around $1, and maybe even go off the board like so many others in this sector – Patriot Coal, Walter Energy… BTU has already been through a bankruptcy, taking out decades of shareholder equity, and now has restructured and emerged to try to do it again.

I’m not one for fundamentals but this industry blow happened just yesterday:

LAST COAL PORT PROPOSAL ON THE WEST COAST DIES

Businessmen, especially coal executives, always complain that environmentalists never let them do anything. That is not true. Environmentalists don’t let them do stupid things. All of coal, once an evil necessity, is now a stupid thing.

So, trading-wise, I’m looking for more signs of weakness, negative candles, breaking supports, indicator divergences before sealing the shafts (see the charts below). Call it waiting for the bloom to come off the black Trump rose.

(click on each chart for a larger view)

All information, presentations and discussions on this site are no more than a journal of my personal stock market thinking and trading. This site is for entertainment purposes alone, and nothing here is to be construed in any way as direct investment advice.

#Stocks – if one wants to bottom fish…

The sector to bottom fish for the long term isn’t coal, isn’t oil, isn’t fossil fuel in general, it is solar and other renewables.

No matter how much the Trump administration is going to want to pay off his blow-hard coal supporters this is still an industry with one foot in the grave and the other slipping in its own dust.

I can hear some coal boys braying but, but, but BTU (Peabody Energy, the “biggest coal company in the world”) was up 22% today to $13. Yeah.  And it may go higher short term but there is a 15-to-1 reverse split in there so it’s not out of penny stock territory and Mr. Peabody biggest-coal-company-in-the-world is also in bankruptcy.  And a lot of these last of the coal stocks are up a lot hoping for Trump but the future is the future and they don’t have much of one with coal plants still shutting down domestically and internationally the rest of the world going on with the Paris climate-change accord no matter what the U.S. does.

Coal, once a necessary evil, remains an evil investment in the death of the planet.

So here we are once again on the cusp of tomorrow and beyond.

There will be volatility but if one can stand it, there will be rewards in renewable energy in the fullness of time. And today’s pop in the sector might be the start of something big given that’s it come on bad news for the sector in general.

(right click on the charts for a larger view)

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Coal Stocks – the great short of the milennium

The media headlines Monday said the Supreme Court ruled against the EPA on mercury emissions in coal-fired electric generation, “giving the coal industry a victory.” According to the stocks, now pretty much in free fall again, the media got it wrong.

May be waving good-bye to (BTU), Peabody Energy’s share-holder equity soon.

Nine month ago I argued with somebody on Reddit who was saying BTU had plenty of liquidity and I was wrong about the company’s prospects being dire going forward.  I told him to watch the headlines. BTU, down overall from an all time high of 79 to under 2 dollars today, has more dire headlines to come.

P.S. By the way, this is all good news for the efforts to stop and reverse climate change.

(Click on image for a larger view)

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