Peabody Energy (BTU) [As of June-15th, 2015]
Current SI: 80.45 M Shares
Prior SI: 73.22 M Shares
Increase (# Shares): 7.3 M
Increase (% Shares): 9.9%
SI as % of Float: 29.2%
7M shares shorted between 2.21 and 3.49 (Recipe for impending squeeze) Will do a separate post for squeeze analysis.
Elliot Wave Technical Analysis and Price Targets
As per Elliot Wave Theory:
PT-1: $3.3-$3.6 Range (Minute Wave) (1-2 weeks)
PT2: $4.5-$5.9 Range (Minor Wave-3 termination) (4-6 Weeks)
PT-3: $7-$8 Range (End of Wave-A) (Minor Wave-4 termination) (6-10 Weeks)
Note: All time frames are from the presumed bottom on June-16th @ $2.21
The minimum price target is the Wave-4 of prior degree, in this case would be $8 level. Look at he moves in VALE and PBR from their bottoms... BTU will be similar
Check out my charts on StockTwits under handle "Options_Only_Trader"
Risk/Reward = 10%-15% downside, 50%-150% upside...
I'm talking about intermediate term IV (Dec-Jan options), it is back to Mid-may levels. of course, the near term is still elevated...
Looks like the next move up should test the 2.85 level and once broken should see some short covering that will push it to 3.3-3.5 level rapidly
The reason that option prices got slammed is cuz the implied volatility got slammed today (Has been dropping since last Tuesday's reversal) It is back to Mid-May levels when BTU was trading between 4.4.& 4.7
Option markets liquidity is provider by bigger market makers... But, all of those ASKS/BIDS are run by algos. If you have level-II access (Which i do...) you see the market dept, I can easily manipulate the the price (if the spread is wide)... If i want to BUY lower ( A bigger chunk)
I did this today...
BTU, Dec-5.50 call (ASK was 0.09, BID was 0.02) I lowered the ASK to 0.06 by putting out a SELL of 10 contracts for 0.06 and put in bigger buys of 200 contracts at 0.05 that got filled.
The reason I'm saying the options were a SELL is cuz they was sold at the BID (Almost the lows of the day). I've access to look at the price of each contract chunk and what was paid for it.
But, a few days ago 56K Dec-5 calls were purchased at the ASK and the same with Sep $4 calls (47K).
You mean "Guess"... the option trade was a SELL (No guessing there...) My guess was about the rationale behind the trade? Covered call could have been the trade, personally this trade doesn't make a lot of sense.
same here... Bought some in May (20%) of my position and bought the rest 75% of the position today. As per EWT, if my count is correct then there should be a move to $6-$8 at the minimum in the coming weeks.
Never buy stocks based on anybody's recommendation...Esp. the clowns on TV. Buy when the sentiment is extremely negative combined with change in trend and technicals.
The analysts are even bigger scam artist that work the average Joe to profit their clients. They hated NFLX at 60's and upgrade it at $600+. GS make it a point to come and downgrade BTU from $3-$2. I guess they wanted their clients to cover lower...This pattern goes on and on...
Most of the options were sold... The price point was at the lowest values of the day. It happened a the same time when the stock took a dive. My guess it is programmatic trade and would have to be covered at some point unless BTU is heading to zero.
A 20% move from the bottom is a good start... A inverted head and shoulders is in the making. We can potentially see a rally to $3.3-$3.5 ish' level then a pull back to 3'sh level, on $2.85 is surpassed. If the I H&S plays out then the potential target is $4.5-$4.8. I'll post a separate analysis based on EWT (Elliot Wave Theory) on a separate post.
I've been studying EWT for technical analysis in the recent years and must say it is the best possible tool to foresee the moves before it happens. If my wave count is correct, BTU is the verge of a major trend change. If the EWT pattern is complete then the minimum inital PT is $6-$8, if not it will be $3.8-$4.8 and another leg down before it turns. Either way, we should see at least see 50%-80% move up from today's lows (if it holds)
You guys think that stocks trade only based on sound or weak fundamentals and future potential. The most important factor is the the investor psychology and sentiment. Currently is at an extreme that is the exact opposite of Apr-2008 or Apr-2011. The stocks follow a wave pattern and when extremities are reached in price and sentiment, it will reverse and so will the fundamentals the articles that follow. These same WS clowns will spring upgrades once it reverses and then doubles or triples.... One the global depression takes hold, nobody would care about the green initiative let alone coal.