Monday, July 8, 2013

WLT Walter Energy Weekly and Daily Charts Oversold Falling Wedges Positive Divergence

WLT is beaten day after day. Even the cab driver parked at the curb the other day to walk over and kick Walter laying in the alley way. Buyers came in a couple weeks ago as shown by the volume but as price drifted lower again they were quick to run back out. WLT charts are in sync with the KOL coal sector ETF charts with oversold conditions, falling wedges, and positive divergence, all pointing to upside. WLT is a met coal play so it is hugely reliant on the steel industry and in a slowing China and global environment, Walter is slapped some more. The charts show that a base is in so it is an attractive knife-catch for the long side.

The insiders have been buying stock but that does not necessarily guarantee upside. Other traders are worried about debt and a collapse in WLT moving forward. Cash flow appears adequate for a few quarters ahead and they will continue to steam line operations so the news is likely not as bad as portrayed. To add to the drama of this trade, WLT has been a takeover target for the last couple years, in the 20's price range, but all this talk is silent as price leaks lower.  WLT is a very speculative trade. Keystone is currently long WLT and a recovery and sideways to sideways up move is expected for the weeks and months ahead. Note how natty gas prices are rising on the demand for air conditioning and higher natty prices is good for the coal sector. 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.

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