% | $
Quotes you view appear here for quick access.

North American Energy Partners Inc. Message Board

  • chemaes44 chemaes44 Mar 28, 2011 3:33 PM Flag

    Met coal, oil and silver

    When I posted on Friday that i saw unusual activity in met coal plays, I guess it was explained today with goldman sachs upgrade on WLT. They are up 3% today alone.

    I started to see this a few days ago even though I only posted about it friday.

    there is unusual activity in two juniors I watch as well. Cline Mining CMK and Grande Cache coal GCE have experienced some unusual trading patterns. GCE basically has stayed the same but moved unusually to me intraday and cline has seen heavy accumulation by one buyer, while the major teck cominco has languished.

    Over the last two days I've seen one buyer accumulate $7 million dollars worth of cline and I'm still riding it. up about 8% since buy in.

    I'm gun shy of oil right now, i'm scared of the gap at 101.62. Oil could plunge $3 in one shot and I don't won't to get run over, but mid east could shoot it to the guys as well. It looks like a H&S on the hourly chart completed on sunday night.

    Silver has behaved weakly to me. I'm completely in cash waiting for a buy signal because I believe SLW has formed a pretty nicely defined cup and handle for an explosive move upside. The potential move has 20-25% written on it using the formation as guidance to project high.

    Good trading

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • Nice gap up on SLW this morning.


    • chem,

      Thanks for the thorough reply. Some trade on technicals, some trade on fundamentals, so I try to watch both, simply because whatever people are doing, whether I consider it right or wrong, can affect share price. SLW and the price of silver started diverging more than they usually do on Thursday, about the time that word got out about the strike at San Dimas, which supplies something like 15% of the silver SLW streams. Clearly, that could affect quarterly results if it lasted a long time. I suspect it won't, which means the dip in SLW resulting from the news could be a buying opportunity. But it's just one small piece of the picture.

      I appreciate your insight, as I've found your calls to be quite accurate.

    • Hey Lance,

      You are absolutely right it could be, but it might not be. I gave up a long time ago trying to figure the non technical why's. I'm aware mind you, but it isn't my decision maker. Oil is something discussed on this board all the time, why o why is it going up when cushings is exploding with supply. I don't know but the technicals say don't worry about it, just make money as it rises.

      I watch the price of slw and the price of silver. SLW sent a clear sell signal thursday while silver rolled over at the end of the day confirming sell.

      On Friday, silver rolled over on the jobs report and when slw rolled over too, these both indicated to keep out. But then, silver rose negating its break down and so did slw. Into the close silver remained strong but slw encountered selling pressure that took it down marginally.

      Summarizing SLW's action, thursday it was just straight down. Friday it was down, then fought back up, then suffered marginal selling through to the close. That 2 day movement is usually indicative of bulls gaining strength. However, when coupled with silver breaking higher and remaining higher my bet has to be if silver goes up significantly slw has to go up or stay flat. The longer slw resists moving up the more inclined I am to rid myself of slw.

      So yes, silver strike in mexico, probably...but it doesn't matter based on how I trade. Fundamentals cause you to make a lot of emotional mistakes and empty your pocket faster.


    • Hey Tiger,

      >>what if it is actually the holders of physical silver that is doing the shorting<<

      I've held silver since about 2004 and if there's one thing I've learned, silver or gold bugs consider it sacrilegious shorting the metals. It is their ultimate store of wealth. Now larger money entities I agree will put on hedge strategies using silver futures, SLV etc.. The key is I try not to spend too much time trying to figure the reason behind the movement as i spend analyzing is the movement going to cause the item to move up or down. Over the years I've found it a fruitless effort figuring out why, like oil going up as an example even though inventories are high. Don't stand in front of the train is what I say, just get on.

      >>discount you suffer when selling PM's<<

      After seeing this too several years ago I decided to figure out a strategy for selling when I was ready. Generally premium is 7 to 15 percent. I decided when I'm ready to sell, either ebay or craigs list will be my route. On ebay you charge the same premimum you paid and sometimes the over bidding can get you a nice penny. doing it on ebay seems cumbersome setting up accounts, pay pal, shipping etc but I keep it in mind. I imagine when I'm ready to sell most of my position it will be at a time (maybe dreaming here) when silver is closer to $100 per ounce. I imagine I'll get a pretty good premium. What I'll likely do is post it on craigs list, name a price, the buyers has to bring a certified check, on the day before transaction open up a safety deposit box at the bank and put your metal in there then, the next day have the buyer meet you at the bank with the cheque in hand, take the certified check deposit it and hand the person their robbery concerns, this is explained in the craigs list post to make them feel comfortable, all are happy..

      >So a strategy of always holding your physical and periodically selling short to neutralize your position if one feels prices are temporarily <

      Absolutely! thought this at first, but the thing that I've found is I never think about hedging my silver because I bought it for that rainy, no category 5 (x 2) Hurricane, day where the financial system may break down, like it came days away from doing in 2008. If I see a really good opportunity and I mean really good opportunity I have a 2 x etf silver bear lined up to take advantage of silver decline but I don't think of it as hedging because I'm never thinking about my bars, its just another way for me to make money.

      I know you aren't faint hearted tiger, I remember looking through a thread where i think you posted pictures of your green bikini. Now anyone who psots pictures like that is one tough hombre. Post was for the board in generally.

      I have a lot of silver & gold and a box full of ammo. A canadian with ammo, go


    • I know we're brushing away fundamentals and news like pesky but inconsequential flies, but couldn't the action in SLW compared to the price of silver in the last couple of days be due to the miners' strike in Mexico that has the potential to delay some silver sales?

    • Chemaes,

      After some studying on owning physical silver & gold. I was just pondering a thought here, but what if it is actually the holders of physical silver that is doing the shorting?

      If you want to protect your silver value and are concerned about silver being too high, simply sell short a similar dollar value using SLV or SLW. That way you will have a market neutral position. Something silver traders might consider?

      Getting hold of (buying) the physical metal can sometimes be burdensome , not to mention come with added cost in terms of (sometimes hefty)bid-ask premiums over spot price of silver depending on who people are dealing with. So that's the premium you pay when you buy.

      But even worse (sometimes) is the discount you suffer when selling.

      And that's especially the case when selling older circulated 'junk'silver coins.

      See a quote as to what you might get when selling as opposed to buying(the spread).

      See the "buy price" which is what they will pay you as compared to the sell price if you should be buying.

      Anyway, the point being that if you sell your physical coins and ever want to buy back in again, you incurr huge costs every time you do that.

      So instead of selling ones physical metal, a synthetic sale using SLV/SLW i.e.(I would SLV would be the best bet) selling short a similar $$ amount is much cheaper and can easily be reversed by covering the short with a buy without leaving your house.

      One other thing...

      When you have the physical, YOU HAVE IT and need not worry about the door closing and possibly(?) being unable to get physical again.

      Probably not as likely with silver coins as gold but who knows?

      So a strategy of always holding your physical and periodically selling short to neutralize your position if one feels prices are temporarily overdone is not only one that saves on transaction costs but might also provide insurance against the possibility that you might never be able to buy the physical metal again.

      Besides, holding physical helps keep the system honest since there are many who speculate that it's just a matter of time before the SHTF & the silver shorts in the futures mkt will have a huge problem settling their outstanding short positions with physical metal.

      If that day comes, you will be glad you have real physical metal in your hands and don't have to worry about fighting the crowds.

      I hate crowds...especially that type.

      TA is much faster. Great Post!!

      >>> These four things are the most volatile commodities to trade so be forewarned this ain't for the faint hearted.<<<

      Chemaes-- I've been called a lot of things, but feint hearted isn't one of them. Just ask Jeff. :)

      Have a great weekend All!


    • I know, very, very weird.

      Silver broke down but managed to come back to exactly where it broke down from and - exceed it. That is a very rare event for any price action.

      Even though the close wasn't higher than the open, I bought in one account less than 1/3 of what I'd normally buy all-in. Why? For silver to recover from a 68 cent fall intraday with a 76 cent advance on a friday no less is compelling to me. Also, SSRI the leader of the pack was up 1.8%.

      I think shorts have dug in and are driving SLW price lower in the face of rising silver. I've seen this only a few times over the years of trading silver. This type of action marks an impending top or a very, very rapid advance. I know, sounds like I'm sitting on the fence, of course I'll be write saying something like this but let me explain.

      The mechanics work like this: the shorts believe we are at or only a few percent away from the top. silver advances upward but slw does not move or moves lower. what happens next depends on how strong the silver advance is. If silver only advances another 2 or 3% the shorts might remain in and the shorts will become entrenched resulting in a nasty fall. If Ag can advance strongly past 2 or 3 % and quickly the shorts will give up and there'll be a bit of an explosive pop. Please, please, let no one bring up JPM shorts I'm speaking about more practical shorting here. We wait until monday.

      On rare earths, i broke my own rules for friday afternoon trades. The advance of AVL was also very compelling for me, again on a friday, so much so that I i calculated a correction low and picked up shares in two accounts. I calculated it within 1 penny.

      On oil, I predicted 108.06 early yesterday morning i think. At yesterday's closing 4:00 pm tick guess what the price was, you guessed it 108.06. It spike to 108.15 before closing there. Since my modelling is starting to work again, I think the libya factor or other fundamentals have removed them selves from the equation and we are now back to a strickly technical move being called on by $117 oil.

      Unfortunately, this one worked backward. I expressed that it would hit 108.06 then back off to 106.50. It did it in reverse going to 105.46 (closing print 10 min) first before going to 108.06. I tried to make money on this one but essentially only covered my fees when I exited. Oil has 117.31 written on it.

      On coking coal tiger, I think CLF is a good bet. Why I like CLF is because it's an all-in-one shop. That is iron for making steel, coking coking coal for strengthening steel, energy for the plant fuel etc...I bought something less all-in-one but providing the exposure to met coal I need in CMK. Why i find them compelling is there is a lot of talk of consolidation in the industry. The most likely takeover target that I read about is CMK so although I'm not getting the all-in-one exposure you are, I'm getting the coking coal and take over premium.

      Having said that I've only caught one takeover in my life, a sinopec china oil takeover several years ago. But additionally, I've never read much about takeover until the last couple of months because I've remained a tech guy.

      So, I'm in silver, met coal, rare earth and out of oil. These four things are the most volatile commodities to trade so be forewarned this ain't for the faint hearted.

      have a good weekend

    • So much for that support, lol...


    • I see that, there was a rumor started this morning that a Mackie research analyst had placed a $26 price target on it. After the analyst was contacted, he said he hasn't changed his estimate on AVL & still had a price target of $10.50

      Still, a nice gain. :)

      Looks to be nice support right here at 43.20 on SLW, see if it holds.



    • Avalon is up 11% today

    • View More Messages
2.19+0.02(+0.92%)Apr 29 4:00 PMEDT