Wednesday, June 5, 2013
KOL Coal Sector Weekly and Daily Charts Oversold Falling Wedges Positive Divergence
You have to love the witty ETF acronyms such as KOL for coal. With natty gas prices at super lows one year ago, coal was shunned in favor of cleaner gas. Also, the Obama Administration dislikes coal further beating down this very honorable and important energy-and steel-producing fuel. When weekly and daily charts agree in positive divergence across all indicators an important bottom is being placed. Natty gas prices have been on the rise so the tables will turn back into coal's favor. Electricity needs, however, will likely remain challenged moving forward. There is a touch of near-term downside momo (short red liens) but overall the coal sector should be explored for long plays moving forward. Keystone is in the risky and speculative WLT right now and may jump into KOL today. Projection is for KOL to experience a launch at anytime. Keystone's 80/20 rule says 22 may lead to 18 so that must be considered but from a risk-reward perspective, KOL likely has zero to two bucks of downside and perhaps 7 or 8 bucks of upside over the coming weeks or a few months. So there are long opportunities out there in areas such as coal, miners, shipping and ag. This information is for educational and entertainment purposes only. Do not invest based on anything you read or view here. Consult your financial advisor before making any investment decision.