ANNOUNCEMENT: The paid newsletter now has a monthly subscription option at $150/month. If you've profited from my analysis, I encourage you to sign up and support my work so I can keep this going. The Members Area contains write ups on 11 new stocks, a futures portfolio, as well as my thoughts on crypto. Further updates on open trades will be reserved exclusively for paid subscribers.
Alliance Resource Partners (ARLP), another coal miner, reported Q2 results today and the stock fell over 5%. The company reported lower revenues and higher inventories due to the Baltimore bridge incident.
"Coal sales volumes during the 2024 Quarter were impacted by flooding on the Ohio River delaying barge deliveries. Rail and port logistics were disrupted by the Baltimore bridge incident, which as time progressed impacted shipments from our Appalachia rail operations. These delays, combined with lower export sales, lifted our inventories higher by 0.8 million tons compared to the Sequential Quarter," commented Mr. Craft, Chairman, President and CEO of ARLP.
The price action is significant since it marks the end of the smooth uptrend.
Consol Energy reports pre-open on August 8. I'm in no hurry to exit but I intend to be out of the stock by then. This has been a great trade mainly because I could make it my no.1 position on the Baltimore bridge panic and ride the mean reversion. I'm not overstaying my welcome.
On the daily chart, today looks to be an inverted hammer candle and the stock is stuck around the 50 DMA. The overall coal sector, with the exception of Warrior Met Coal (HCC) and Thungela Resources (TGA.L) has lost momentum. These are bearish signs. Sell.
Good Trading!
Kashyap