what a day today for JRCC and the coal sector. I had to take a lost on the strangle and got out with a 2K lost so far. This seems to look like the blow off everyone is looking for, for a month or two now. Tomorrow will probably be low volume and not much of an indication of what's to come next week.
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magic journal of doom
- Thread starter magicz
- Start date
Close my put vertical at the open today. The sector is nose diving still. I'll cut my loses here and moved on. -6K here plus yesterday -2K put me back to even money. I'll take my 15K out and start over. I'll going to analyze where this trade went wrong. The big big down day yesterday was out of the blue and I want to see if option volume indicated the move or any other factor that could have pointed me to getting out earlier with a smaller loss. I am going to take the weekend off going to a BBQ on Friday and Golfing on Sunday. I feel like I didn't do enough research but that's not true. I didn't expect a 13 point move at all, a 5-6 point move yes not 13. This is one of those trade where you can say yes I did my research but black swan happens and move on. And so I will.
just to make me feel better my biotech play on my other account is doing much better then this account.
just to make me feel better my biotech play on my other account is doing much better then this account.
Well I am back from vacation and refreshed. The market is dumping some more since I left, I see. other then financial stocks going down the tubes, oil is still high, commodity is high, my biotech sector is quiet. I am ready to get back in the flow here. I re analyzed my JRCC position last month and I saw that I was too aggressive on the trade. I was blinded by the near expiration jump of over 20% and of my previous profit on the trade. After the huge dump off it revert back to the original trend line that started in March. well after 3 month its back to square one.
This is only my opinion on JRCC,
After doing a little research, I saw that weekly spot coal prices have plateau and begining to come down abit. The stock at this point is pricing in the new contracts for 2009. I'll probably won't put too much money in before the earning and conference call.
Case 1:
If the earning next month is a surprise on the positive side or even flat then we will probably see a steady, though volatile increase in the stock price following the same trend line. Also assuming that they sold new contracts to deliver coal at market prices within the past few months. In this scenerio, I can see it can go pass the 60's.
Case 2:
negative suprise on earning, few new contracts, negative production capicity due to envir,labor,fuel. I can see shares in the 20's or below.
After doing a little research, I saw that weekly spot coal prices have plateau and begining to come down abit. The stock at this point is pricing in the new contracts for 2009. I'll probably won't put too much money in before the earning and conference call.
Case 1:
If the earning next month is a surprise on the positive side or even flat then we will probably see a steady, though volatile increase in the stock price following the same trend line. Also assuming that they sold new contracts to deliver coal at market prices within the past few months. In this scenerio, I can see it can go pass the 60's.
Case 2:
negative suprise on earning, few new contracts, negative production capicity due to envir,labor,fuel. I can see shares in the 20's or below.
Quote from magicz:
This is only my opinion on JRCC,
After doing a little research, I saw that weekly spot coal prices have plateau and begining to come down abit. The stock at this point is pricing in the new contracts for 2009. I'll probably won't put too much money in before the earning and conference call.
Case 1:
If the earning next month is a surprise on the positive side or even flat then we will probably see a steady, though volatile increase in the stock price following the same trend line. Also assuming that they sold new contracts to deliver coal at market prices within the past few months. In this scenerio, I can see it can go pass the 60's.
Case 2:
negative suprise on earning, few new contracts, negative production capicity due to envir,labor,fuel. I can see shares in the 20's or below.
Case 2 could be a very accurate statement if the coal sector can't post expected earnings. I could see this sector even having a larger pullback, losing most of its ridiculous gains. the 20s for JRCC is not an unrealistic target.
I have been looking at ICO as a positive opportunity as well.
<a href="http://www.intlcoal.com/pages/quarter/2008_1st_QTR.pdf">Latest Quarterly</a>
However, even with all the production delays that inhibited them the first quarter, and with new complexes being opened and being put into operation, I still see them having a hard time posting positive earnings. Leaving me a bit leery to get involved before the report.
ICO, as far as I have seen, has the earliest earnings date of many of the larger coal companies. So, it should be somewhat of an indication for the rest of the industry. Any thoughts?
I actually did alot of research on ICO before picking JRCC as my coal horse.
ICO stock price is low for a reason and it has been the laggard of the industry. Here are the reasons why, in no particular order
1. huge float with 100+ Mil shares. with a dilution just this pass month of covertable bonds.
2. debt is huge for that size of a company.
3. negative cash flow, with below market contract still on the books.
4. produces low quality coal.
5. labor problems.
I am sure I can dig up a few more reason why I don't like this company. I wouldn't not touch it unless it can show me some positive signs which it hasn't. In fact ,they might have to borrow more money if they don't have positive cash flow by the end of this year.
ICO stock price is low for a reason and it has been the laggard of the industry. Here are the reasons why, in no particular order
1. huge float with 100+ Mil shares. with a dilution just this pass month of covertable bonds.
2. debt is huge for that size of a company.
3. negative cash flow, with below market contract still on the books.
4. produces low quality coal.
5. labor problems.
I am sure I can dig up a few more reason why I don't like this company. I wouldn't not touch it unless it can show me some positive signs which it hasn't. In fact ,they might have to borrow more money if they don't have positive cash flow by the end of this year.
the inverse relationship between the broad market and oil is something amazing in the pass couple of weeks. nothing move the market except oil, even though we are in the earning season.
VNDA is expect an FDA decision on its schizo drug around July 25.
I have a net long position in this in another account.
POZN looking for some positive earning result since the drug was approve for sale ealier this year.
VNDA is expect an FDA decision on its schizo drug around July 25.
I have a net long position in this in another account.
POZN looking for some positive earning result since the drug was approve for sale ealier this year.
sold 10 strangle 29,45 aug of ELN@2.1 this morning.
MYGN: I am not calling a top on this but the 15 point run up from 6/27 till now is not because of money saved from the development of the fail drug. At this point I am not sure exactly what is driving the price up this high, so I'll stay on the sideline on this guy. The options for the current month to me seems to say this will be around the low 50's by august expiration.
JRCC: I am looking forward to its peer earning report this week, ICO, FCL, and the big gun PCX next week. This will give me a good indication how JRCC will react.
ELN: This guy will be in a trading range until the news from their full data release at a bio conference later this week. I am looking for mix result with some positive aspect to keep the trading range intact. if not I am out.
MYGN: I am not calling a top on this but the 15 point run up from 6/27 till now is not because of money saved from the development of the fail drug. At this point I am not sure exactly what is driving the price up this high, so I'll stay on the sideline on this guy. The options for the current month to me seems to say this will be around the low 50's by august expiration.
JRCC: I am looking forward to its peer earning report this week, ICO, FCL, and the big gun PCX next week. This will give me a good indication how JRCC will react.
ELN: This guy will be in a trading range until the news from their full data release at a bio conference later this week. I am looking for mix result with some positive aspect to keep the trading range intact. if not I am out.