I wrote an article recently about coal stocks. Based on their current levels, technically they were close to a bounce. I touched on stocks like Arch Coal Inc (NYSE:ACI), Patriot Coal Corporation (NYSE:PCX) and James River Coal Company (NASDAQ:JRCC). Even Alpha Natural Resources, Inc. (NYSE:ANR) should be mentioned as a possible squeeze play.
The reason why I am noting the coal stocks again is because of the monster spike in natural gas. Natural gas inventories came in much smaller than expected. The commodity spiked sharply higher. The United States Natural Gas Fund, LP (NYSEARCA:UNG) is trading at $16.54, +1.31 (8.60%). Many people may not understand this, but there is a major connection between the two forms of energy. They are the cheapest type of energy and trade together. Therefore, when I saw the massive spike on the natural gas inventories, the obvious sympathy play was coal stocks. If natural gas continues to stay strong, coal stocks will continue to inch higher. The amount of shorts in them is huge. This means a possible squeeze is always in play.
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High Alert: Coal Stocks Start To Rumble Off Natural Gas
Published 06/16/2012, 03:26 AM
Updated 07/09/2023, 06:31 AM
High Alert: Coal Stocks Start To Rumble Off Natural Gas
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