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Cliffs Natural Resources Inc. Message Board

  • dow50000 dow50000 Jan 9, 2014 5:30 PM Flag

    Truly baffled

    I will be the first to admit I expected a short term move up at the beginning of the year. If you read any of my posts however, you also know my enthusiasm was rather contained.

    But this is simply crazy.

    This is the biggest down day since June and a definitive break of the shorter term uptrend. This is a move of 7% (almost 20% in 2 trading weeks on benign market) that comes on no news whatsoever.

    WLT and ANR downgrade you say? Well, WLT is down 3.64% and ANR 3.83%, half the decline of CLF. This is clearly company specific.

    I also believe this move was not anticipated by anyone as I've been tracking options statistics and call volume is consistently twice as high as puts. That does not mean that people are buying calls of course, however I have a hard time believing that risk oriented fund managers sell calls on a stock with 35% short interest. Also, there was no noteworthy put buying or large put positions either.

    As for the technical aspect, I am just as confused. We put in 2 dojis (long legged one being the last one) right at the trendline signifying a very likely reversal of the downtrend. And then we crack 7% on double the volume.

    I realize this is a momentum stock and it gets whipped around by algos all day long, but damn.

    This has been a very painful new year. Last year we did not see the prices of January ever again. So far the story is eerily similar.

    Good luck all.

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    • imaginejml@sbcglobal.net imaginejml Jan 10, 2014 7:10 AM Flag

      Very baffeling indeed. Your post was well written and factual. Too many on this board post emotions.

      AKS was also down by 6.4% yesterday. While the last two weeks have been hard for most in the materials space, CLF still is up about 50% from when WS started accumilating these stocks back in June.

      Seperate of China, fundamentals seem to favor this space for 2014. So I do not worry about this drop that much. WS usually gets crazy on the upside, including to the downside.

    • it amazes me these pumpers continue to justify the drop and make excuses for every wrong turn this pos makes.
      one day doesn't make a stock. how about 15% in a week?
      jan and feb are strong months. rest of the year looks great:)
      $30 by earnings. how does $20 look?

    • This stock has been going up. It was $16 only 6 months ago. It will continue to go up. It just got ahead of itself. Nothing is wrong here.

    • This time when it hit the bolinger band at 27 back before the new year, I shorted my position. Problem is I never expected to go this low. Hmmm.

    • Dow, this one caught me as well. that break of $24.50 was the tell.
      i think they take this down into earnings.
      The P&F chart had CLF going to $44 Monday, swung to $18 today.
      trend break.

    • hey dow, at least CLF 200DMA is holding! as far is down,ANR BTU WLT have been going down 3-4% over the last 5 days,CLF got it all in 2 days,if they all went down exactly,it would look too controlled,i still feel we ran up into the EOY 2013 and selling into earnings,just how feel, even USS is down from 31ish last few days,jmo

    • It is crazy this amount of decline---after over a week of steady declines already. Short interest definitely has a great deal of numerical sway, IMO. The other, seems like WS abandoned their stakes in materials in general, or at least the % that was invested and not short already.

      This trade action becomes self perpetuating and self repeating. This kind of decline and repeated history of in the trenches , leads the thought of--who want to invest long with horrible year over year results when there are so many many equities on fire.

      About the only positive---from a contrarian point of view---when all is negative, the numbers, analysts, Forbes and short interest---usually there becomes more to gain from a upside point of view. Still could drop plenty though if any even questionable results or news.

      • 1 Reply to rpschom
      • And again we come back to the 1/3+ float short. That's not retail and they have the means and stamina to make their short position a winning one. CLF really has only 3 scenarios for earnings (1) misses = shorts win, (2) meets = shorts probably still win short term, or (3) beats = ?. If the market is heading downward at that time, it still won't matter and shorts win, If Wall St claims data is old and forecast for 2014 is for I/O pricing down = shorts still win. Only positive scenario is for EVERYTHING to align with a good beat. Heck, even if everything goes right, a $5-6 jump from $21-23 is still less than last year's pps at the secondary. Wall St will have effectively controlled the run once again. Who wouldn't short on those odds? There, now that I've convinced myself it's hopeless I will be adding more tomorrow at open :).

    • Any ideas into why? Me either but if it doesn't rebound some next week we could be in for even further downside. When I was in LVS I saw this same action when China was supposedly slowing and didn't come out of it till China PMI improved but China PMI isn't bad.

      Sentiment: Buy

 
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