CLD (Cloud Peak Energy Inc.) will trigger a long entry on any break above 3.57 (preferably on above avg. volume). Suggested stops using a 3:1 or better R/R to one’s preferred price target (T1 or T2). 60 minute chart below:
CLD 60 minute Aug 26th
Zooming out to the daily time frame, a breakout above this Descending Broadening Wedge pattern would coincide with a breakout of the dual intersecting resistance levels on the 60-minute chart & would likely have intermediate to longer-term bullish implications for CLD. As such, additional price targets (see 60 minute chart) may be added.
CLD daily Aug 26th
This should be considered an aggressive, counter-trend trade as the coal stocks have been in a relentless bear market for years. With that being said, I’m only viewing ACI as a relatively short-term swing trade at this time although I may extend the trade, adding additional price targets should the charts convince me to do so. It appears to me that the market may be in the final stages of sorting out the winners & losers (i.e.- those companies likely to file for bankruptcy protection, thereby wiping out shareholder equity) in the coal sector. For example, I see some of the coal stocks still entrenched firmly in a death spiral while others have started to rally sharply over the last few weeks with stocks like BTU, which recently rallied 104% in just 8 trading sessions, and ACI, rising an impressive 330% in just the last 7 trading sessions.
Even if these just prove to be fleeting oversold rallies in an ongoing bear market, money can be made on either side of the trade in coal stocks. For example, the last trade on CLD on the site was a counter-trend long trade in late 2014 that hit the final target for a quick 14.7% gain (that trade can be viewed by clicking here).