When to invest in commodity cycles: it’s all about timing

“buy when there’s blood in the streets”
I think this holds true for major commodity cycles. Case study example is the coal industry. I’ve been watching for the bottoming of coal for damn near three years, but it’s kept going down and down and I’ve lost my ass trying to time the bottom. 

Now, the bottom may or may not be in, but after a 700% rally in ACI and a 250% rally in BTU, ACI with the most volume in two weeks ever, it’s looking more likely than ever before.

What set this event apart from the last ones is the bankruptcy of two major companies ANR and WLT. Both companies defaulted a couple months ago in June and July–blood on the streets. It important to remember that patriot coal and james River coal both defaulted about two years ago. These were weaker companies. 

We also got a major investment last week from George soros who disclosed a million shares in ACI and BTU respectively. 

So remember, when buying commodity bottoms, wait till some of the major major players in the game have given up and gone bankrupt. 

Then! Pounce on the near dead rat mutant rat that will give your portfolio superhuman strength.

From here I will be buying any pullbacks to near previous bottoms or possibly 10 week moving averages.


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