Patriot Coal (PCX) – Major break at $25

This is a major coal mining company in the US.  Coal stocks are moving up due to the projected demand in China for metallurgical coal.

Take a look at the 3 year chart.  This is the start of a classic chart pattern with a break at $25 which is major resistance. Now the stock must hold above $25.  An important concept in technical analysis is support and resistance.  Once a stock breaks resistance; the price point becomes support.  In the case of Patriot Coal, $25 is now major support; and I will sell the stock if it does not hold this price point.

You can see the momentum in the 1 year chart.

Disclosure: I have a long position in this company at a purchase price of $20.60

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