ARCH Forecast + Trading Strategies


Bullish Case: ARCH's strong financials, recent dividend declaration, mean-reverting price action, and high industrial demand for coking coal suggest potential for price appreciation.


Bearish Case: Environmental regulations, insider sales, and declining coal prices present significant headwinds. High implied volatilities also indicate market uncertainty about ARCH's future.


Potential Outcomes: 55% moderate growth due to robust demand, 30% decline from environmental policies, 15% flat performance due to market and regulatory uncertainties.


Trading Oracle: Execute a debit spread on ARCH by buying the August 2024 165C and selling the 175C. With high implied volatility and term structure favoring theta decay, this strategy leverages growth potential while mitigating downside. Time horizon: 1-2 months.


July 07, 2024


Arch Resources Forecast

ARCH      Arch Resources











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Assets that tend to move strongly with ARCH



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XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (-0.19)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.3)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.34)



Uncorrelated Assets

Assets with little price relationship to ARCH



XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (-0.19)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.3)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.34)


ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.39)



Anticorrelated Assets

Assets that tend to move strongly against ARCH



ETRN Forecast + Options Trading Strategies   ETRN  Equitrans Midstream (0.39)


XLE Forecast + Options Trading Strategies   XLE  Energy Select Sector SPDR (-0.19)


VFC Forecast + Options Trading Strategies   VFC  VF (-0.3)


LI Forecast + Options Trading Strategies   LI  Li Auto (-0.34)





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