BTU update

On the 1st of this month we observed that BTU was a buy, not maybe but definitely. Here is the main argument once again in picture format (that is a chart), see previous blog.

BTU july 1 2013

First hint was the absolutely beautiful B-wave. Second hint was the vector equality of waves C and A, not a must but nevertheless a frequent occurrence. What is helping us out- we were already well on our way- is the help that we are getting from the Chinese government. Just like the Americans, they believe in a central command and control economic system. The only major difference is that they used to practice this approach for everything whereas the Americans only apply it wholeheartedly to central banking ( and a few dozen other areas!). The word is out, from now on the economy will grow at a pace no lower than 7%.  There must be something magic about the 6 to 7% range. This is roughly the same level that the Fed. is targeting for unemployment and, for those that can still remember the good old times, where interest should be, give or take, when allowed to find their proper equilibrium. Anyway, here is where we are today on rekindled demand for BTUs from China;

btu jul 22 2013 bbtu jul 22 2013 s

Basically we are up $3 on $15 in a month or 20%. The chart is very similar to that of ABX but the initial targets are a little higher. $21.84 for the immediate future and about $29 for the longer term. Keep your eye on the RSI. See also