Arch Coal Is Just The Best Of A Bad Group

This past weekend I made a note that there is finally a coal chart that I could start to like, Arch Coal (ACI). What seems to have been missed is the caveats that came with my future approval. Let me explain in more detail.

The daily chart below shows a bottoming formation, nothing more. The price has stopped falling and is moving sideways. It has a Relative Strength Index (RSI) that has continued to stall at 60 and a Moving Average Convergence Divergence indicator (MACD) that has been running flat and is now starting to fade. Consolidation at best on this time frame, with the possibility of a minor double top at the falling 100-day Simple Moving Average (SMA).

Arch Coal (ACI) Daily

It will take a move over 7.70, a higher high to start a bullish watch. The weekly picture puts it into perspective. The channel between 5.80 and 7.70 shows a MACD that is trying to move higher and a RSI that is slowly trending up, but the MACD is still very near zero and the RSI is not yet over 40 and starting to roll lower.

Arch Coal (ACI) Weekly

Nothing bullish here, move along. Finally, the monthly view is showing nothing more than a bear flag with a RSI that is running along the oversold line but not extreme and a MACD that is negative and slowly going nowhere.

Go ahead and put your money in this name if you have some fundamental reason. Frankly with a slowing world economy I am not sure what that could be. But from a technical perspective, this stock is treading water and has not shown that it will even survive. With the broad market looking much better, I will pass.

Arch Coal (ACI) Monthly

Disclaimer: The information in this blog post represents my own opinions and does not contain a recommendation for any particular security or investment. I or my affiliates may hold positions or other interests in securities mentioned in the Blog, please see my Disclaimer page for my full disclaimer.

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