Looks like we found resistance at 4.50. Several questions:
1) Before pushing through 4.50, will it correct or move sideways?
2) How long before it pushes through 4.50?
3) If it corrects, how big a correction will it be?
At 4.50, the stock was up over 50% from the 4.70 low of less than a month ago. Such a significant run seems to warrant a substantial pullback so I think we will see a correction. If we assume that correction gives back half the gains, that would take us to 3.60 which coincides with the 10 DMA. If the 10 DMA holds, which I expect, we should see a rebound to 4.50 with a gradual fight upwards to 5 over the next month. If the 10 DMA doesn't hold, we are likely to test the 50 and 200 DMAs at just a little above 3.30. For anyone shorting at current levels, covering at that test of the 50 DMA would be wise because if it more likely we will see 5 than 3 before the next earnings.
I lightened up today to lock in some of my profits and believing I will have the opportunity to reestablish my position between 3.60 and 3.70 ... perhaps lower. Of course, I kept most of the position just in case it doesn't correct and goes sideways before resuming its run to 6.
This has been quite a week with the stock going almost straight up. So how high will it go before correcting? After taking out an interim high at 3.65, it didn't even pause at the next interim high of 3.95. The next interim high is 6.20. Will it pause there or will it run to the 52 week high of 6.44? There is a flat stretch as it fell between 4.75 and 5.10. Perhaps it will take a breather there.
Another factor is the short positions which stood at almost 8 Million shares at the end of July. They must be covering rapidly. When will they have covered? At what price will the shorts who covered during the 1st week of August start shorting again? Wildman was talking about selling more shorts in the high 4s and low 5s. Will that break this rally?
I certainly don't know but am enjoying the ride. Will be watching to sell my long trading positions but we aren't there yet.
The bigger the spread between oil and natural gas, the faster transportation companies will switch to NG. The decision to switch from diesel to NG, however, is strategic and so transportation companies focus on long term trends rather than the spot market prices of diesel and NG when making the decision. And right now that long term trend is flat.
So, CLNE price action is best explained by looking at their performance for the last two quarters; performance on volume and profit that exceeded expectations. This has changed the speculation from will CLNE survive to how much money can they make and dramatically increased the value of this stock. I.e., CLNE is a capital intensive company that has just "turned the corne" from spending money to making money.
It has been a wonderful run since earnings and based on today, that run isn't over. This makes your $4 is possible this week, i.e., before 8/20/2016. Hopefully the shorts on this board took my advice of 7/20 and closed their positions because it looks unlikely we will see prices below $3 again this quarter while we are certain to see prices above 4 and may see prices above 6.
Obviously, your earnings expectations were off. The crucial question is why were they off.
Here is my analysis...CLNE faced an incredible chicken and egg problem; transportation companies could not switch to Natural Gas until there were refueling stations. It was impossible to justify building fueling stations until transportation companies switched. So CLNE took a flyer and bet transportation companies would switch when there were enough refueling stations. The only question was would it run out of cash before it built enough refueling stations. It was a close call but about a year ago, the number of fueling stations reached critical mass and transportation companies began switching. The difference between the price of NG and diesel drives the rate of switching. This impacts CLNE's growth rate. The trucks purchased last year, however, will continue to refuel for another 10+ years, so volumes will remain strong. And volumes are what drives CLNE profit.
Bottom line...assuming CLNE can remain profitable and cash flow positive fro a couple of more quarters, it will behave like a utility in a high growth market with a relatively stable cash flow for years on end. Electric vehicles are the biggest threat and they are at least 10 years in the future.