Im not gonna do it
What options in the coal ETF would beg a good bet ?
Given the bullish Elliott Wave setup we discussed earlier (potential wave 3 extension targeting $28–$30+ if momentum holds), $COAL (Range Global Coal Index ETF) remains an interesting candidate for upside options plays. As of mid-January 2026, the ETF is trading around $24–$25 (recent closes noted near $24.97 on Jan 9, with fluctuations between ~$23–$25 in early January data).
Options liquidity on $COAL is relatively thin (typical for a smaller/specialized ETF like this, with low volume/open interest on most strikes), so spreads can be wide, and execution might require patience. Available data shows limited chains, primarily near-term expirations like January 16, 2026 (very short-dated, more for gamma scalps than swings). Implied volatility appears elevated (often 60–110% on sampled strikes), which benefits premium sellers but makes long calls more expensive.
Bullish Options Ideas (Aligned with Upside Breakout)Here are some reasonable, higher-conviction plays assuming continued strength in met coal prices and the ETF holding above key support (~$23):
- Buy Slightly Out-of-the-Money (OTM) Calls — For directional conviction with leverage.
- Target strikes like $25–$26 (if spot ~$25) for the nearest available expiration (e.g., Jan 16 or next monthly if listed).
- These offer good risk/reward if wave 3 extends quickly, as the ETF could push 10–20%+ higher on momentum.
- Why good? Low delta initially, but high gamma if it breaks higher; caps downside to premium paid. Avoid deep ITM unless you want more delta exposure (higher cost).
- Bull Call Spread — More conservative, defined-risk way to play the upside.
- Buy a near-the-money call (e.g., $25 strike) and sell a higher strike (e.g., $27–$28) for the same expiration.
- This reduces cost vs. naked long call, limits max loss to net debit, and still captures solid gains if $COAL rallies toward $28+.
- Ideal for the current environment: Balances the breakout thesis with thin liquidity and potential pullbacks.
- Longer-Dated Calls (if available) — Check for February/March 2026 expirations on platforms like Yahoo Finance, Investing.com, or your broker (e.g., Robinhood/Schwab list $COAL options).
- These give more time for the Elliott Wave impulse to develop without theta decay crushing you short-term.
- Premium will be higher, but better for swing/position trades targeting $28+.
Key Considerations & Risks- Liquidity Warning: Volume/open interest is often single digits on many strikes — use limit orders and avoid market orders to prevent bad fills. Consider wider spreads if needed.
- Volatility: High IV means long options are pricey; if the move stalls, time decay hurts fast.
- Invalidation: Drop below $23 could invalidate the bullish count and lead to sharp downside (puts would then be better, but we're focusing on upside here).
- Always size small due to the niche nature of the ETF — this isn't a high-volume name like SPY.
For the most current chain, check your broker or sites like Yahoo Finance/Investing.com (search "COAL options"). If you're seeing fresh data showing better liquidity or new expirations, lean toward ATM/near-ATM calls for the best balance of probability and payoff.
This is not financial advice — options involve significant risk of loss, especially in lower-liquidity names. Do your due diligence, and consider paper trading first! If you share more details (e.g., your risk tolerance, timeline, or specific strikes you're eyeing), I can refine this further. |
