Posted by darnelds on 11th of Sep 2012 at 10:27 am
It appears that coal stocks have moved in the same pattern as
China ($SSEC). With $SSEC breaking up out of a wedge, this
may be a good set up in Chinese stocks and confirmation of the buy
signal in coal stocks.
Yes there is a correlation, the recent China stimulus
announcement has helped pop Coal stocks in the hope that the
stimulus might increase the need & production of steel in China
and it is Metallurgical or "Coking" coal that is used in the
process.
How much there is there? Not sure. I think it is
more a bounce for an oversold group of stocks using the news as a
catalyst. I think for the move to have legs there just has to
be demand and demand for coal is predominantly US based. The
recent slide in demand was attributed to lower NatGas prices which
can be used as a substitute for coal and slowing growth here and
abroad.
Interesting stats I have in my notes which I believe are correct
but you may want to verify. Half of the US' electricity
consumption is fueled by coal and of the coal mined 93% goes to
that effort leaving about 5% for export (Yes that totals 98% so I
imagine the remainder is for stockings).
The biggest market for coal is Asia, which currently accounts
for over 65% of global coal consumption; although China is
responsible for a significant proportion of this. Many countries do
not have natural energy resources sufficient to cover their energy
needs, and therefore need to import energy to help meet their
requirements. Japan, Chinese Taipei and Korea, for example, import
significant quantities of steam coal for electricity generation and
coking coal for steel production.
Since 2000, global coal consumption has grown faster than any
other fuel. The five largest coal users - China, USA, India, Russia
and Japan - account for 77% of total global coal use.
I imagine that is all true. In my first post when I stated
demand for coal is based in the US I was referring then to the then
posted stats regarding US mined coal as the majority is used to
provide electricity (stays in the US).
Emerging markets are the great growth sector for coal especially
coking coal which is used to make steel or by aluminum plants
etc.
What my point was is that if your trading a chart on technicals
than no understanding is needed. If your trying to trade a
more broad correlation then you want to make sure the stock you
pick fits that thesis. IMHO
Coal Question
Posted by darnelds on 11th of Sep 2012 at 10:27 am
It appears that coal stocks have moved in the same pattern as China ($SSEC). With $SSEC breaking up out of a wedge, this may be a good set up in Chinese stocks and confirmation of the buy signal in coal stocks.
Yes there is a correlation,
Posted by tom on 11th of Sep 2012 at 10:47 am
Yes there is a correlation, the recent China stimulus announcement has helped pop Coal stocks in the hope that the stimulus might increase the need & production of steel in China and it is Metallurgical or "Coking" coal that is used in the process.
How much there is there? Not sure. I think it is more a bounce for an oversold group of stocks using the news as a catalyst. I think for the move to have legs there just has to be demand and demand for coal is predominantly US based. The recent slide in demand was attributed to lower NatGas prices which can be used as a substitute for coal and slowing growth here and abroad.
Interesting stats I have in my notes which I believe are correct but you may want to verify. Half of the US' electricity consumption is fueled by coal and of the coal mined 93% goes to that effort leaving about 5% for export (Yes that totals 98% so I imagine the remainder is for stockings).
Coal- largest market is Asia per world coal association-
Posted by parkridge77 on 11th of Sep 2012 at 11:09 am
this from www.worldcoal.orgsite ( world coal association)
The biggest market for coal is Asia, which currently accounts for over 65% of global coal consumption; although China is responsible for a significant proportion of this. Many countries do not have natural energy resources sufficient to cover their energy needs, and therefore need to import energy to help meet their requirements. Japan, Chinese Taipei and Korea, for example, import significant quantities of steam coal for electricity generation and coking coal for steel production.
Since 2000, global coal consumption has grown faster than any other fuel. The five largest coal users - China, USA, India, Russia and Japan - account for 77% of total global coal use.
I imagine that is all
Posted by tom on 11th of Sep 2012 at 11:44 am
I imagine that is all true. In my first post when I stated demand for coal is based in the US I was referring then to the then posted stats regarding US mined coal as the majority is used to provide electricity (stays in the US).
Emerging markets are the great growth sector for coal especially coking coal which is used to make steel or by aluminum plants etc.
What my point was is that if your trading a chart on technicals than no understanding is needed. If your trying to trade a more broad correlation then you want to make sure the stock you pick fits that thesis. IMHO
Coal/China
Posted by evne01 on 11th of Sep 2012 at 10:33 am
That makes good sense. I live in an area where coal is mined and a large portion of it, for years, has been shipped to China.