# The Bull shall Return



## YOUNG_TRADER (20 June 2006)

Well I'm back from my little break, what a month it has been, 

What a shift of perspective, 2 months ago everyone was screaming China, India, Japan re-awakening, Europe Steadying, US steadying etc etc, not enough commodities, Commodity Super Cycle 

Today, its like everyone has an inside scoop to Federal Reserve Bank, inflation, interest rates, slowing economies blah blah blah, 

The bears are out, and the bulls are well, there in the pubs drowning their sorrows away or are they?

After spending nearly all of yesterday on the phones to brokers, the consensus is clear, most if not all brokers were struggling to keep up with commodity price rises, as such in their valuation/profit guidance targets they were using conservative loing term forecasts, 

The commodities whose spots were way ahead of brokers forecasts were Copper, Zinc and to a lesser or should I say shorter lived extent Gold.

Now reporting season is at most a month away, lets see how much upside suprise comes from the earnings of stocks like

BHP, OXR, ZFX, KZL, PEM, CBH, and a whole lot more, 

I also think STO, WPL, TAP, ARQ, ROC will all benefit from higher all prices, but analysts were fairly close with estimates, 

Still there will be many suprises to the upside, which will result in a raft of upgrades, with brokers scrambling over each other to upgrade not wanting to be left out and the bull market for commodities and in Australia Resource Socks will really take off,

On reflection I think that this period here, is what they call 'the wall of worry' and once over its when the real bubble starts!


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## bullmarket (20 June 2006)

Hi young_trader

I'm not convinced that the bulls will come back with the same vengeance.  I think there are too many potential storm clouds on the horizon....ie....high oil prices, rising inflation in the US and here, possibly rising interest rates both here and in the US, the Chinese gov't being reported in The Age a few weeks ago saying they want to slow down their unsustainable economic growth rate etc for the market to be pushed past its recent all time highs within the next 6 months and possibly even 12 months.

I think our market (XJO) will basically trade sideways for a while with more downside than upside risk in at least the short term if there is any more bad news.

cheers

bullmarket


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## wavepicker (20 June 2006)

bullmarket said:
			
		

> Hi young_trader
> 
> I'm not convinced that the bulls will come back with the same vengeance.  I think there are too many potential storm clouds on the horizon....ie....high oil prices, rising inflation in the US and here, possibly rising interest rates both here and in the US, the Chinese gov't being reported in The Age a few weeks ago saying they want to slow down their unsustainable economic growth rate etc for the market to be pushed past its recent all time highs within the next 6 months and possibly even 12 months.
> 
> ...




Totally agree with you bullmarket,

I think it's going to be tough going for the bulls in the next 2-3 years
with more downside before any major rally on the horizon.

This has to be expected after a very strong run in the last 3 years.

cheers


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## specman (20 June 2006)

Quite a few economists in the U.S believes the market is oversold.Based on forecast earnings,stocks are undervalued in relation to previous history.Companies in the U.S continue to upgrade their earnings forecast.

What IS worrying the market is that the Fed will overshoot with their raising of rates and send the economy into recession.The hawkish tone on inflation by Bernanke has not helped in this regard.

There are already signs that the U.S economy is slowing down,thereby putting less pressure on inflation and most economists believe that the ceiling for rates will be 5.5% and that should be enough to control inflation.It is currently 5%,so 2 more hikes instore and I think the market has factored in one already.If the ceiling is going to be 5.5% and inflation in control then the economy should be fine.High oil prices are here to stay and Bernanke believes the U.S economy is very resilient and is not having as big an impact on inflation as was feared.

However,if inflation continues to rise even after 2 more rate hikes,then the dreaded stagflation scenario becomes possible and stock markets will suffer.I doubt this will happen but the next set of core CPI data should be interesting.


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## wayneL (20 June 2006)

specman said:
			
		

> Quite a few economists in the U.S believes the market is oversold.Based on forecast earnings,*stocks are undervalued in relation to previous history*.Companies in the U.S continue to upgrade their earnings forecast.




And therein lies the rub. Which history are those economist looking at... and what is their agenda?

Is the time frame 2 months, a year, 5 years, 10 years, a hundred years? I won't pretend to anything about valuations, but I remember a time when p/e 12 was considered expensive. Now thats a bargain. I believe a time is approaching where that will once again be considered expensive.

There is no risk premium available in stocks (as a long term investment) and any percieved value is all speculative. Something like Ducati pointed out in his BHP thread.

Lets not ever forget "most" economists/analysts have an agenda/vested interest. It's a bit like Real Estate Institutes commenting on the stae of the real estate market... always a positive spin, no matter what.  

Cheers


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## scsl (20 June 2006)

This is part of an article from MoneyWeek (watch out for David Fuller's comments):

*Will China's slowdown really sink the commodities market?*
19 June 2006

_It was all going so well.

After taking a dive at the start of the week, world stock markets recovered some of their poise mid-week. By Thursday's close, the FTSE 100 looked as if it had a good chance of ending the week higher than where it began.

And then another Federal Reserve banker decided to open his mouth and state the obvious yet again…

William Poole, the president of the Federal Reserve Bank of St Louis, ensured stocks ended last week on a low note when he pointed out that “core inflation is modestly above what many of us have expressed as our comfort zone.”

Speaking to reporters in South Korea, he continued: “It’s certainly my view that if the inflation rate continues to be persistent like that, the Federal Reserve will simply have to pursue [anti-inflationary policies]."

Let’s leave aside the fact that the idea of an anti-inflationary central banker is something of an oxymoron. After all, they're the ones who've been printing all this money and driving prices higher in the first place.

Mr Poole’s comments reawakened all the insecurity that had briefly been set aside mid-week. Traders had become resigned to a fresh US interest rate hike at the end of this month, but now they are getting worried that another will follow sharply on its heels.

But the renewed nerviness wasn’t just down to Mr Poole. China did its bit to rattle investors at the end of a long week as well, by announcing its very own bit of financial tightening.

The People’s Bank of China raised its “required reserve ratio” for commercial lenders by 0.5% percentage points, to 8%.

Basically, this means that commercial lenders will be able to advance fewer loans, because they will need to keep more money in their reserves. The hope is that this move will help to slow investment in unnecessary factories and infrastructure projects.

This is far from the only measure designed to slow investment growth, says Julian Jessop at Capital Economics. In April, the Chinese central bank hiked the key interest rate to 5.85% form 5.58%, reacting to strong economic growth in the first quarter. 

“Further…controls [on lending] may well be coming. Individually, none of these measures is likely to make much difference, but as a package they should have more bite,” says Mr Jessop.

This news hit mining stocks in particular – investors are concerned that if China’s economy starts to slow down, then the country’s demand for raw materials will also fall, driving down commodity prices.

So is the market right to be punishing the mining sector?

We don’t think so. As highly respected financial commentator David Fuller points out on Fullermoney.com, the commodities story isn’t just about China – “it now emanates from most of Asia, South America, much of the Middle East, Eastern Europe and even Africa.” 

Unsurprisingly, the populations of these developing economies want the higher standard of living that they see in the West. And that demand will require a lot of raw materials to sustain it.

As Mr Fuller puts it: “You don’t need to be a mining analyst, let alone an economics wonk, to appreciate that when 5.5bn mostly impoverished but naturally intelligent and often highly educated people are encouraged to lift themselves out of shanty towns or rural squalor, and into the gleaming cities and higher paid careers that 1.5bn people in the developed world have mostly taken for granted, the newcomers embrace this opportunity with considerable zeal.”

He believes “we are only a few years into what will surely be the biggest and longest bull market for industrial resources that the world has ever seen.”

But if you want to worry about bubbles, there are certainly plenty of them around just now. In the commercial property sector for example, Jenny Davey in The Times reports that property developers are planning to build the equivalent of 33 shopping centres the size of Bluewater (Europe’s largest shopping centre) in the UK over the next four years.

More than 18 million square feet is already under construction. That’s the most since the period from 1989 to 1991, when 19 million square feet of new shopping space was built - just before the property crash of the early nineties. 

All this new building is going on at a time when consumers have never been more indebted, and the high street is looking increasingly vulnerable. Perhaps more importantly, it’s also occurring just as retail outlets are losing significant levels of market share to the internet. 

We don’t think the UK needs more shops. But we do think the world needs lots more raw materials. So although the mining sector correction may well continue while markets remain confused and scared about a US-led slowdown in China, remember that’s all it is - a correction, not a crash. _ 


"we are only a few years into what will surely be the biggest and longest bull market for industrial resources that the world has ever seen" .....ahhhh, just what we all needed to hear amid all the chaos of inflation worries!


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## specman (20 June 2006)

wayneL said:
			
		

> And therein lies the rub. Which history are those economist looking at... and what is their agenda?
> 
> Is the time frame 2 months, a year, 5 years, 10 years, a hundred years? I won't pretend to anything about valuations, but I remember a time when p/e 12 was considered expensive. Now thats a bargain. I believe a time is approaching where that will once again be considered expensive.
> 
> ...



How do you determine what is good value?One investor may find a company with a p.e of 12 good value,another may not consider it good value unless it is less than 7.Ultimately,the market overall will determine the value and the fact that the stocks on the S&P500 is undervalued historically should be a positive,not negative.It is certainly not in a tech boom type bubble.

Once the wall of worry about recession and stagflation is lifted,there is certainly plenty of upside potential.Of course,a recession is possible and some economists are even predicting a depression due to the massive U.S current account deficit.Nobody can accurately predict the future,just make an educated guess.


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## TheAnalyst (20 June 2006)

specman said:
			
		

> How do you determine what is good value?One investor may find a company with a p.e of 12 good value,another may not consider it good value unless it is less than 7.Ultimately,the market overall will determine the value and the fact that the stocks on the S&P500 is undervalued historically should be a positive,not negative.It is certainly not in a tech boom type bubble.
> 
> Once the wall of worry about recession and stagflation is lifted,there is certainly plenty of upside potential.Of course,a recession is possible and some economists are even predicting a depression due to the massive U.S current account deficit.Nobody can accurately predict the future,just make an educated guess.




Someones selling and it aint mums and dads thats for sure....so it seems at this stage especially after this duration and no end in sight that large funds of every type are factoring in some very bad news..........interest rates is the most obvious at this stage....


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## specman (20 June 2006)

TheAnalyst said:
			
		

> Someones selling and it aint mums and dads thats for sure....so it seems at this stage especially after this duration and no end in sight that large funds of every type are factoring in some very bad news..........interest rates is the most obvious at this stage....




Inflation is the biggest worry.The U.S Fed will fight inflation at the expense of the economy.You can kickstart a sluggish economy quickly by lowering rates but inflation takes years to root out.

If inflation data continues to be above expectation,it is a given that interest rates will be hiked and if they hike it more than needed(it takes 12 months before the effects are felt) then they could send the U.S economy into recession,with repercussions felt globally.This is probably what is worrying the funds,not that stocks are overvalued.


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## RickG (20 June 2006)

Don't mean to hijack this thread, but *one* reason why I think the bull run is far from over (in the medium to long term anyway) is a simple thing called superannuation.  This is the first generation which has been forced to put 9% of their income into a super, and many contribute more.  

Maybe I am being too simplistic, but the money has got to go somewhere, and most policies I would assume have a large portion going into shares.  If you keep fueling the fire its got to get bigger.

I think it will be many years yet until retirement starts impacting on super funds.

Anyway would like to hear some ideas on the impact of Super funds on the share market over the last 10 years, and their impact for the future.

I could be way off base, but the injection of funds must have made some impact.


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## carmo (20 June 2006)

Totally agree with RickG, that 9% every week is being forced into a jar that is already full, it has to spill out somewhere!


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## specman (20 June 2006)

RickG said:
			
		

> Don't mean to hijack this thread, but *one* reason why I think the bull run is far from over (in the medium to long term anyway) is a simple thing called superannuation.  This is the first generation which has been forced to put 9% of their income into a super, and many contribute more.
> 
> Maybe I am being too simplistic, but the money has got to go somewhere, and most policies I would assume have a large portion going into shares.  If you keep fueling the fire its got to get bigger.
> 
> ...




Yes,recently released figures showed the Australian managed fund market,everything from super to life insurance,has reached one trillion in funds under management.That is 1000 billion.

All that liquidity has to be parked somewhere and fixed term bank deposits won't please policy holders.


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## Smurf1976 (20 June 2006)

To my understanding, history backs the notion of the Fed going too far with the rate rises. They'll stop when something breaks IMO. Question is whether it's the stock market, houses, general economy etc.


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## Sean K (20 June 2006)

Chindiapanaiwanporeland is REAL. Even a little US recession won't stop it.


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## TheAnalyst (20 June 2006)

It is a historical fact that when interest rates are increased to counter inflation share prices move downwards to ensure the return on shares is greater than the return on fixed interest to reward the investor for the risk and volitility in the share market......then the only way companies can increase there price is for their profits to increase.....

Superannuation can also be put in to cash or fixed interest and various domestic and global bonds and does not all have to be placed into shares.....with the new super rules and contributions it seems that our retirement plans by governments is resembling the U.S. and that may mean that per's can become higher and the market will except this......

I am starting to think that when purchasing shares now factor in a central bank interest rate here in Australia at 7-8% and if the share returns 2-3% above this gross then it is a buy and less riskier.....would like to hear more from others


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## wayneL (20 June 2006)

kennas said:
			
		

> Chindiapanaiwanporeland is REAL. Even a little US recession won't stop it.




The next recession won't be little


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## specman (20 June 2006)

Smurf1976 said:
			
		

> To my understanding, history backs the notion of the Fed going too far with the rate rises. They'll stop when something breaks IMO. Question is whether it's the stock market, houses, general economy etc.




That all depends on your definition of "break".I am assuming that you mean a strong growing economy going into recession or a stock market crash.I don't think the Fed would do that on purpose.It's just easy to get wrong as altering rates does not have an immediate effect on the economy and very easy to overshoot.By the time they stop hikes,it's too late and a recession results 12 months later.They are aiming for a soft landing but of course that is not guaranteed.


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## Sean K (20 June 2006)

Time for a crash eh Wayne? When is it, Sep 07?

What is going to bring it on? Just going on the Waves/Cycles? Or is that when the real WWIII starts? Or, mutation of birdflu/SARS into something serious? Perhaps the Labor Party get into power then. That'd bring on a crash! Especially if Julia is running the show...

You been speaking to Yogi about this?


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## wayneL (21 June 2006)

kennas said:
			
		

> Perhaps the Labor Party get into power then.




That'd probbably do it


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## YOUNG_TRADER (21 June 2006)

carmo said:
			
		

> Totally agree with RickG, that 9% every week is being forced into a jar that is already full, it has to spill out somewhere!





Also what Kennas said, *"Chindiapanaiwanporeland is REAL. Even a little US recession won't stop it."*

Lets look at these 2 points,

*The first is money needs to go somewhere*, isn't it interesting to note that during the last phases of our phenonmenal property boom (2003) money started to pour into the stock market, could this be a coincidence? Alot of property developers I know where cashing up 2003 and we're putting their huge profits into other areas such as ASX stocks, listed managed funds, both locally and overseas etc etc, 
Without a doubt property in most parts of Aus are not cheap, with affordaility at all time lows they are said to be overvalued, I think I read an OECD report that said we have some of the most overvalued property in the World, whether you agree or disagree is irrelevant one thing for sure is that for the last few years the sentiment towards property has died off, 
So property is not as an attractive option to park your money in, so the question comes where do you park your moeny, Bonds, Term Deposits and other fixed interest securities? Or the roaring stock market? ? ?  

The second point is quite simple and I think really underestimated, Chindiapanaiwanporeland is REAL, a quick question to ask some people out there who have these strong views on interest rates slowing global growth etc, have you in the last 2 yrs been to China or India?
For those who have please think about what you saw, those two nations construction development is nothing short of freaky/crazy/scary!!!!!!!

I was in China last year on business for 12 days, on my way from the airport to hotel I past a row of buildings under construction, at least 50, on either side of the road, at the end of my trip on my trip back to the airport to depart the buildings that were say 50% completed were nearly 80% completed I couldn't believe it I was so shocked and amazed I asked the Cab driver how it was possible, he said the work in 3 crews doing 8hr shifts, thats 24hrs a day, 7 days a week construction, with no red tape council crap to restrict and no work cover or unions to slow things down, my point is China and India's construction is like the German build up to WW2 they are going nuts and what are their deadlines? For China the 2008 Olympic Games, for India the 2010, why? Because its the first time the whole world gets to see the nations properly, they are on display and these are two very very proud nations who want to show to the world that they are now a force to be reckoned with, they wish to shake off the shackels of the past that they are 3rd world nations and launch themselves into the new millenium as the future of the world!


To conclude in a clear concise manner, 2 things are certain, we have money and we don't like putting it under our mattreses, we either spend it (we're notorious for this) = More Consumption = Higher GDP
Or we Invest it = Improved sentiment towards investments = Bullish Outlook
The second is any slack left by the US or Western Worlds in terms of Commodity Demnad will be snapped up by China and India and even Japan,
These 3 nations in particular have been in the making for 10 yrs + (Japans Deflation situation) so its taken 10yrs to get the locomotive going, while the track is by no means smooth and there will be a few sharp bends and curves it will take a hell of alot to de-rail these economies.

Thoughts?????


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## bullmarket (21 June 2006)

Hi young_trader

regarding the money has to somewhere argument - yes that's true, but it could easily go where it has gone in the last few weeks during the 10% or so retrace in our market.

Some other alternative options to pouring funds into our market are cash, bonds, hybrids, property (local and overseas), more favourable overseas share markets.......imo you'll find that the institutions that drive the big/pointy end of the market diversify in various asset classes and are by no means generally bound to investing in our market.

I think that money pouring into super funds will only help provide support in our market in at least the short term but definitely won't drive it to new all time highs imo because there are too many investment alternatives to our market given the uncertain global economic conditions and geo-poltical tensions.

All we need now is for the Koreans to start test firing their missiles as they have hinted at and all hell could break loose in the next few months.   

You might recall there were some who predicted a few weeks back the roaring bull market would continue indefinitely because of the reasons you suggested but that was never going to happen, and it obviosly hasn't as evidenced by the last few weeks, as suggested by I and a few other cautious 'bears' around here 

cheers

bullmarket


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## specman (21 June 2006)

"even a little U.S recession won't stop it"....

Where is the logic behind that?It sounds very gung ho which is a dangerous attitude.

China's main source of income is their cheap export products.America is their biggest customer.China simply cannot absorb their own products and rely on foreign consumption.When the day arrives that enough Chinese are rich enough to consume their own products,then maybe the U.S will be less of a factor.Most of the country still lives in poverty.


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## Sean K (21 June 2006)

Yeah, it was a rash comment specman, thanks for pointing it out!   

I think by a 'little' recession I mean something fairly tame on the scale of things. And recessions can be long or short, so perhaps I was thinking of a relatively short one. 

I should have been more careful with the R word. 

Perhaps a US 'slowdown' was what I was intending. 

I must say though, the current figures coming out of China are quite astounding. I can't quote them right now, but they've been mentioned thoughout the forum. One I can pluck is that 310 million Chinese are now walking around with mobile phones this very second and this is growing at an astronomical pace. It now has the third most cars on the planet and will have the most by 2010ish. The list goes on. And on. 

But you are right. Aparantly this growth is reliant on the US buying their trinkets. 

How long it will be before this development is self sustaining is an interesting question. Surely, once there is a large enough middle class, they will be buying the trinkets themselves and it will be an internal merry-go-round for consuming and producing. India, Brazil and Russia need to be buying trinkets too don't forget!


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## bullmarket (21 June 2006)

and the Chinese gov't was reported in The Age a few weeks back that they were looking to slow down their unsustainable high economic growth rate.


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## Rafa (21 June 2006)

kennas said:
			
		

> Surely, once there is a large enough middle class, they will be buying the trinkets themselves and it will be an internal merry-go-round for consuming and producing. India, Brazil and Russia need to be buying trinkets too don't forget!




I think that is purely based on whether advertisers and marketting people can generate irrational and absurd spending habits in Asia, of the scale and magnitude that we are witnessing in the west...

If Japan is anything to go by... Asians do spend, but they save a hell of a lot more...


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## wayneL (21 June 2006)

Goodbye planet Earth if the Asians become like the west.:fan


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## hissho (21 June 2006)

Generally speaking, Asians tend to be very good savers, and to some extent more disciplined. there are credit card "slaves", but way not as many as in US or here...

btw Japanese and Koreas people are more disciplined than Chinese...

cheers


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## Sean K (21 June 2006)

I've only spent a few days in Tokyo, but if the city is anything to go by in regards to the spending habits of the Japanese, they look to be bigger spenders than Melbournians. More mobiles than you can poke a stick at. And they are fashion slaves!

I've only read about how insatiable the Chinese middle class are becomming for new gadgets and symbols of their new found affluence. I do know that they will be buying gold jewllery to display how well off they are. 

Some of you guys have been to China. Don't they buy plasmas and cars and big apartments, etc etc?


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## YOUNG_TRADER (21 June 2006)

I've posted my views, I'll let the economies do my talking for me, lets see where we are 6 months from now,

And Bullmarket regarding _the money has to somewhere argument - yes that's true, but it could easily go where it has gone in the last few weeks during the 10% or so retrace in our market._
From what I've been hearing the funds are on the sidelines ie in CALLABLE CASH ACCOUNTS waiting, so the money hasn't gone too far away

_
You might recall there were some who predicted a few weeks back the roaring bull market would continue indefinitely because of the reasons you suggested but that was never going to happen, and it obviosly hasn't as evidenced by the last few weeks, as suggested by I and a few other cautious 'bears' around here _ 

A bull market doesn't power ahead in a straight verticl ascend it has peaks and troughs, this was merely a correction, doesn't it worry you that when companies like BHP and OXR release their profit figures, they're profits will be based on copper prices recieved of between $7000 - $8800 US/t, where as most analysts were forecasting copper prices of say $3000- $4000 / t 

Also what about Zinc most analysts have been forecasting $2000 as the LT price and for the last 6 months the price has for the most part been between $3000 - $4000 t, lets see what happens when ZFX releases its 4th qtr report,


I think reporting season is the kick thats required, but lets see


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## bullmarket (21 June 2006)

no problem young_trader 

yes, let's see where the markets are in 6 months time.

As I posted earlier either in this or another thread, my   says our market (XJO) will trade sideways for at least the next 6 months with more downside than upside risk and will not break through the previous all time high for at least 6 and possibly 12 months.

cheers

bullmarket


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## Ants (21 June 2006)

O O O (puts my hand up) I>>I>>I been to China . Thats my only real claim to fame lately, I spent 4 weeks touring around China. Even down the Yangtzee and MANY cities in between . Let me start by saying there is as much land as there is/are people (So much space filled with crop it seems,gotta feed that many people somehow). There are ROOLY ROOLY RICH people driving shiny BLACK Audis/Mercs/Mits' cars around (its weird). But they are driving by hoardes of deplorably poor people. So what Im trying to say even though there is wealth there. Most of them are BROKE or working for a pittance! So no they cant afford PLASMAS and the like.(Though they are bloody cheap there) And I know it will/is changing..... BUT and its abig BUT... From seeing the sheer numbers of people. It will be a while before the masses could afford even the rudiments of the middle class 1st worlder. Damn most of em seem to be country folk with radios and ****. Though Even their "small "cities have 3x more people than Perth. But in the cities there is still dirty hole in the ground toilets with no sewerage or toilet paper 5 stories up.Getto lookin stuff. _But they are building_, and there is heaps of 1st world product around it just seems to me like they can see it but cant touch it so close but so far.


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## wavepicker (21 June 2006)

bullmarket said:
			
		

> no problem young_trader
> 
> yes, let's see where the markets are in 6 months time.
> 
> ...




 I agree with you bullmarket, although I expect market to rise in the very short term to 5000+ as mentioned on an earlier thread, I am bearish for the remainder of the year with a final target of 4000+ before a major rally. Sure I expect many countertrend rallies on the way down though.
However the way I am approaching it, this bear trend after it ends will produce another substantial rally but not to new highs. Overall I would expect a choppy, net sideways market for the next 2-3 yrs. Typical of a cycle 4th wave, and something that comes as a surprising dissapointment to the bulls after a strong third wave of the last 3 years. 
Thereafter to have a final blowoff 5th wave to all time highs over 6000.


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## YOUNG_TRADER (25 June 2006)

Anyone else see the report this morning on China's crazy hunger for cars? ? ? 
Its funny 2-3 years ago the program would have talked about the amazing demand for cars and highlighted the negative environmental impacts via the extra pollution created, 

Today they talk about the amazing growth in car ownership in China and the HUGE strain this will put on global OIL supplies and even commodities required to produce the cars, going into some depth as to the energy implications for the globe, then they briefly mention the pollution, 'oh and by the way the environment may suffer'.

Funny isn't it how the shift in focus has occurred? It used to be save the environment, now its save the remaining oil! Whats next Oil Peace? 

Also saw a report that the Chinese and Indian governments, Indian particularly are looking at ways of curbing gas guzzlers by subsidising hybrids, report then went on to show how these new hybrid cars use about 4x as much copper as normal cars, and use a **** load less in petrol, again another funny shift in perspective it used to be they are so clean and environmentally friendly,


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## YOUNG_TRADER (26 June 2006)

Everyday my bullish outlook is re-affirmed, I was looking back over some notes I had from last year and read an interesting article this morning which reminded me,

http://www.fnarena.com/index2.cfm?type=dsp_newsitem&n=0EBFA60A-17A4-1130-F5F1D897DA5F0B0F


Does anyone remember how last year the huge risk to Resources was China's slowdown, it was inevitable it was going to happen for so many reasons yet it didn't did it? ? ? 

Now here we are mid 06 and its all about US rates and the US slowdown, I have no doubt that rising interest rates will curb some consumption and will also slow the US property market but I don't think it will be enough for at least 6-12 months (ie given that Monetary policy lags in its effect) Also didn't a recent report out of US show increased consumption in the May Durable Goods or something?


Its funny how quickly everyone moves from 'Doomsday' event to 'doomsday' event, last year it was the big bad BIRD FLU!!!!!!!!!, what happened? 
Then it was the Iran Uranium Crisis!!!!!!!!!!!!!!!!!!!!!!!!! Sure this is keeping a bit of premium in the oil price, but lets face itthe situation isn't that bad!
Now its the Big Bad North Koreans and there Missiles, again lets see how prominent this issue is in 6 months,

We are definately climbing the wall of worry stage IMO, depending on what Mr B over in the US does will dictate possibly how much longer this 'wall of worry' stage will last, who knows he and the rest of his board may decide to hike rates by 50 basis points, causing another sevre 1-2 week correction, one thing is for sure once all this dust settles and people see the Profit reports that come out in July with record profit this and new record revenue that combined with consistant demand for these commodities, historically low stockpils and a swag of possible supply hic-cups the market will go bezerk, I think it will become a little dot-com bezerk, we still haven't seen that in the resources yet, ie people just going nuts buying for the sake of buying, we saw that in the Recent Uranium hyps (and how profitable was that little period) but I think it will be across the board,


Time will tell,


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## bullmarket (26 June 2006)

Hi young_trader



			
				YOUNG_TRADER said:
			
		

> ...............one thing is for sure once all this dust settles and people see the Profit reports that come out in July with record profit this and new record revenue that combined with consistant demand for these commodities, historically low stockpils and a swag of possible supply hic-cups the market will go bezerk, I think it will become a little dot-com bezerk, we still haven't seen that in the resources yet, ie people just going nuts buying for the sake of buying, we saw that in the Recent Uranium hyps (and how profitable was that little period) but I think it will be across the board,
> 
> 
> Time will tell,




Re the July profit reports.....I think most people will be more interested in what companies say about their outlook and whether the market believes them or not 

I'm not convinced yet that company outlooks, generally, will be all that good for the next 12 months.

I still expect XJO to trade within the ~4700 - 5100 range (ref: weekly XJO charts I posted a few weeks back) for the next few months.  Though there could be a short lived July (new financial year) rally 

cheers

bullmarket


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## YOUNG_TRADER (27 June 2006)

Anyone else see US Housing Report?

Sales were meant to drop in May but wait they actually rose, so China has kept growing at an amazing rate, Japan is re-awakening, India is still following China's growth and the US Consumer spending and housing sector has been strong, so much for the big bad inflationary boogie man.

New home sales rose 4.6 percent in May, the government said on Monday. *The data defied Wall Street's forecast for a decline*. The stronger-than-expected home sales bolstered shares of home builders.


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## noirua (27 June 2006)

YOUNG_TRADER said:
			
		

> Anyone else see US Housing Report?
> 
> Sales were meant to drop in May but wait they actually rose, so China has kept growing at an amazing rate, Japan is re-awakening, India is still following China's growth and the US Consumer spending and housing sector has been strong, so much for the big bad inflationary boogie man,
> 
> ...




Hi Y_T, I saw the report on Bloomberg TV and wondered what is going on. It looks too much like a report to justify the Fed raising rates this week.


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## Gspot (27 June 2006)

Things will jump in July, as the new financial year begins.... this is a fair reason why things have dived and remained flat the last couple of months, (as well as 'the wall of worry'). After making a killing for most of the year, most traders are happy to sell cheaper in order to keep their tax down. And down they want it to stay for another couple of days, then things will start reving up again as bargains will be had. Plus what Y_T had to say.
Like to add that i enjoy this site, and am a total amateur. So be kind.


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## Magdoran (27 June 2006)

Beware, those US housing figures are quoted as having a potential +/- 14% error factor...  Also, the reported aggregate house prices in the US fell too... as bond yields are rising.

Also, there is a lot of conflicting data in the commodities area (NYMEX/COMEX movement’s vs LME for example).  Just look at the various futures charts and try and make sense of the market, especially in different time frames.  Add into that the crude oil factor...

A lot of the data on China is also not what you'd call transparent either... so I’d be a bit careful about singing the bull song, or beating the doom and gloom drum either...

Be careful about the Japan story too.  Don’t forget they hold a significant amount of US currency in one form or another.  If they start selling it strongly, do the math...

Look at US bonds, US Dollar, Gold, Forex in general... a lot of conflicting information about what’s really going on.  It’d be great to have a clear picture, wouldn’t it?


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## wayneL (27 June 2006)

Magdoran said:
			
		

> Beware, those US housing figures are quoted as having a potential +/- 14% error factor...  Also, the reported aggregate house prices in the US fell too... as bond yields are rising.
> 
> Also, there is a lot of conflicting data in the commodities area (NYMEX/COMEX movement’s vs LME for example).  Just look at the various futures charts and try and make sense of the market, especially in different time frames.  Add into that the crude oil factor...
> 
> ...




Great comments Mag,

Gotta look past the financial industry spin, if possible.


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## Kipp (27 June 2006)

wayneL said:
			
		

> Goodbye planet Earth if the Asians become like the west.:fan



Wayne, I think it's a little bit unfair that we **** ourselves and cry "enivironmental disaster" when the India/China middle class takes to cars and consumption.  God forbid that the are as bad as the U.S.!

Australia and the U.S. have squillions of dollars and had access to enviro friendly means of electricity generation and cars for decades--- but have invested in any of them?


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## wayneL (27 June 2006)

Kipp said:
			
		

> Wayne, I think it's a little bit unfair that we **** ourselves and cry "enivironmental disaster" when the India/China middle class takes to cars and consumption.  God forbid that the are as bad as the U.S.!
> 
> Australia and the U.S. have squillions of dollars and had access to enviro friendly means of electricity generation and cars for decades--- but have invested in any of them?




Yes it is unfair. Unfair to the next generations who must cope with a degraded and poisoned planet.

Ah ^%$# it! The Earth is screwed anyway. Lets "eat, drink and be merry, for tommorrow we die"

Cheers


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## bullmarket (28 June 2006)

*I don't think the bulls are back with any real conviction yet  *  

On the weekly XJO chart below the 5 week MA hasn't crossed above the 20 week MA yet. The Stochastic indicator (top indicator) gave an unconvincing buy signal 2 weeks ago but the MACD (bottom indicator) is no where near saying buy yet.

As per the last few weeks, I still think XJO will trade in the ~4800 - 5000 range for the forseeable future.

cheers

bullmarket


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## YOUNG_TRADER (28 June 2006)

wayneL said:
			
		

> Yes it is unfair. Unfair to the next generations who must cope with a degraded and poisoned planet.
> 
> Ah ^%$# it! The Earth is screwed anyway. Lets "eat, drink and be merry, for tommorrow we die"
> 
> Cheers




Here here, lets all just have fun, the world was meant to come to a halt in 2000 courtesy of the big bad millenium bug so we're probably on borrowed time, everyone should sell their portfolios and buy sports cars


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## YOUNG_TRADER (29 June 2006)

The 'hot money' that has chased AUM and UXA are clear evidence to me that there are plenty of bulls in the starting line waiting, I think we are in for a really big upswing very shortly when all the hot money gets tired of waiting on the sidelines and jumps back in, Mid July onwards in my opinion!


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## bullmarket (29 June 2006)

Hi young_trader



			
				YOUNG_TRADER said:
			
		

> The 'hot money' that has chased AUM and UXA are clear evidence to me that there are plenty of bulls in the starting line waiting, I think we are in for a really big upswing very shortly when all the hot money gets tired of waiting on the sidelines and jumps back in, Mid July onwards in my opinion!




I'm still not convinced as evidenced by the weekly XJO chart I posted earlier.

Yes, there might be a tradional new financial year rally in July but imo it will be short lived especially if interest rates continue to rise in the US and locally 

cheers

bullmarket


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## chennyleeeee (29 June 2006)

The market drives itself. All this interest rate, economy, dow jones and blah blah blah blah are just an excuse to explain the movement. These things are only so important because we put so much importance on it.

UBS conducted an experiment some time ago and it found that the country that loses a world cup game, their stock market tends to go down the following trading day. Explain that to me. hahaha .....And we get all the analysts who would probably blame lack of consumer demand, failed marketing, blah blah blah and the price goes down 10% just because of some incident which fundamentally does nothing to a company in the long run.

We drive the market, if i wanted the stock price of say BHP to go up and if i had the money to do so, I'll buy every single one listed and watch it blossom. The market aint perfect and a bull shall only return when everyone as a group starts believing that all this hype about who noes what next wont mean anything and start bidding the prices up. There's just too much uncertainty atm so no one wants to be in the market atm. When things cool down and there isnt all this hype stirring up the market, ppl will come back and alls well.

Say for instance the monday effect we had years ago. If we all believe on monday the shares go up. We'll all go buy shares on monday, excessive demand drives the prices up. The market is self fulfilling.


Anyways, enough of my prophecies. Feel free to debate my opinions.

CHEN


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## wayneL (29 June 2006)

chennyleeeee said:
			
		

> The market drives itself. All this interest rate, economy, dow jones and blah blah blah blah are just an excuse to explain the movement. These things are only so important because we put so much importance on it.
> 
> UBS conducted an experiment some time ago and it found that the country that loses a world cup game, their stock market tends to go down the following trading day. Explain that to me. hahaha .....And we get all the analysts who would probably blame lack of consumer demand, failed marketing, blah blah blah and the price goes down 10% just because of some incident which fundamentally does nothing to a company in the long run.
> 
> ...





Valid comment. Sentiment rules in the short-medium term.

But it ignores the REAL driver of the market over the LONG TERM.

Fundamental value! When fundamental value is exceeded, eventually people sell.... sometimes _en mass._

Cheers


----------



## cuttlefish (29 June 2006)

YOUNG_TRADER said:
			
		

> The 'hot money' that has chased AUM and UXA are clear evidence to me that there are plenty of bulls in the starting line waiting!




They're just speculative plays and an indication that there are still people around and still volatility. Not sure I'd call $5million turnover in a day 'hot money' its relatively small from a market perpsective.

I think Wayne's got it right - ultimately fundamentals do drive markets. When they're overvalued and the fundamentals aren't improving they will get driven down over the medium to long term, and the reverse applies if they are undervalued and the fundamentals are improving.  

The level of excitement that occurs in speculative plays is high at the top of a bull market where people buy companies with no earnings and little in the way of tangible assets*, while at the bottom of a bear market a small cap can hold more cash than its market cap and still people find excuses not to buy it.

(* I'm not saying UXA or AUM are in this category I know very little about them)


----------



## shasta (30 June 2006)

It's fear and greed (emotion, sentiment - call it what you will) that mainly drive the market up and down and fear and greed is determined, subliminally at least, on fundamentals to various degrees depending on each individual....eg...rumours (although rumours are not technically a fundamental   ), local/global economic outlook, announcements, company valuations, company forecasts/outlook, balance sheet/financial performance etc etc and hence whether you think a share price is expensive or cheap.




			
				chennyleeeee said:
			
		

> The market drives itself. All this interest rate, economy, dow jones and blah blah blah blah are just an excuse to explain the movement. These things are only so important because we put so much importance on it.
> 
> UBS conducted an experiment some time ago and it found that the country that loses a world cup game, their stock market tends to go down the following trading day. Explain that to me. hahaha .....And we get all the analysts who would probably blame lack of consumer demand, failed marketing, blah blah blah and the price goes down 10% just because of some incident which fundamentally does nothing to a company in the long run.
> 
> ...


----------



## YOUNG_TRADER (5 July 2006)

YOUNG_TRADER said:
			
		

> The 'hot money' that has chased AUM and UXA are clear evidence to me that there are plenty of bulls in the starting line waiting, I think we are in for a really big upswing very shortly when all the hot money gets tired of waiting on the sidelines and jumps back in, Mid July onwards in my opinion!





My oh my did the Bull Ever get up and charge on AUM      

But also look at the flow on effect it had on URL and EXS,

Without Analysing its fundamentals take a look at the chart of PYM almost 400% in 2 weeks

I think we're starting to see that Super Speculative Period emerging that I was talking about, a period where alot of resource companies will simply skyrocket on weak to poor fundamanetal ann, ie drilling results/intersections, resource estimates, in-situ value of ore etc etc


----------



## YOUNG_TRADER (6 July 2006)

bullmarket said:
			
		

> Hi young_trader
> 
> 
> 
> ...





Aus rates on hold, XJO holding around 5100, what does our chart say Bull?

Is it failing to break resistance or it consolidating around 5100? 

I would have thought consolidation, but then I'm no tech


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## YOUNG_TRADER (7 July 2006)

Copper up 5% 
Zinc up 5% 
Gold up to recent high of $630+

If these gains hold throughout the night, tommorrow shall be a ripper!


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## ctp6360 (7 July 2006)

I never doubted you for a second YT 
(btw I'm back from my holiday on the 11th of July, Hawaii is beautiful! I just found out Bill Gates stayed here 3 weeks ago...I need to start digging on the beach in case he left any treasure!)


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## wayneL (7 July 2006)

ctp6360 said:
			
		

> I never doubted you for a second YT
> (btw I'm back from my holiday on the 11th of July, Hawaii is beautiful! I just found out Bill Gates stayed here 3 weeks ago...I need to start digging on the beach in case he left any treasure!)




We expect a comprehensive report on your travels C...and a round of drinks at the pub if you find that treasure


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## wayneL (7 July 2006)

YOUNG_TRADER said:
			
		

> Copper up 5%
> Zinc up 5%
> Gold up to recent high of $630+
> 
> If these gains hold throughout the night, tommorrow shall be a ripper!




Interesting!

The US mining stocks didn't do much. Base metal miners did nothing. BHP & RTP (RIO) ADR's didn't do much. Some goldies even down a tad. Not even any currency moves to be able to explain it away  

Perhaps some skepticism about the recent moves in the metals?

ASX will be telling, but no leads from the SYCOM at this stage.


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## moses (7 July 2006)

Copper Surges, Leads Metals Rally, on Renewed Demand by Investment Funds - Bloomberg, Jul 06, 2006 15:04


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## moses (7 July 2006)

European Stocks Gain on Growth Outlook; HSBC, BHP Billiton Pace Advance  European stocks resumed their advance on speculation the region's economy can withstand higher borrowing costs.

U.K. FTSE 100 Index Climbs to Two-Month High; Oil, Mining Stocks Pace Gain The U.K.'s benchmark FTSE 100 Index rose to a two-month high, lifted by energy producers including BP Plc and Cairn Energy Plc after oil yesterday reached a record.


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## mit (7 July 2006)

The XJO seems to have hit a resistance. We'll see what happens with a strong lead from the DOW overnight does, whether this is going to be a double top or not.

MIT


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## YOUNG_TRADER (7 July 2006)

We're through as far as I can see, XJO gapped up above 5100 this morning


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## mit (7 July 2006)

YOUNG_TRADER said:
			
		

> We're through as far as I can see, XJO gapped up above 5100 this morning




I wasn't surprised about this morning given the DOW overnight but it has retreated back around 5120. See what this afternoon brings.

MIT


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## jet-r (7 July 2006)

YOUNG_TRADER said:
			
		

> We're through as far as I can see, XJO gapped up above 5100 this morning





I dont think we are through unless we close above 5082 today and advance for another 2 days in a row next week. It would be great if it close at around 5200 by Tuesday


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## swingstar (7 July 2006)

There is strong resistance around 11300 for the Dow dating back to 99.


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## swingstar (8 July 2006)

... and down it goes.


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## swingstar (8 July 2006)

Since I can't edit. Looks to be mostly 3M that's pulled it down.


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## YOUNG_TRADER (19 July 2006)

It seems like theres no stopping China!

Looks like the stronger for longer Resources Theory is holding up!

China says feed me I'm hungry!!!!!!
Austalia should keep all this inflation mumo jumbo quiet and feed the great Red Dragon all the Iron Ore, Oil, Uranium, Zinc, Copper, Nickel heck whatever it needs!


China’s Exports Just Keep Booming: So Too Car Sales
July 11 2006 - Australasian Investment Review – (AIR) 

China has just recorded its biggest ever trade surplus: a record $US14.5 billion ($A18.7 billion) in June as exports surged.
That was up from May's figure of $US13 billion and came on the back of a 23 per cent jump in exports, compared to June 2005.

Exports totalled $US81.3 billion in the month, while imports rose 18.9 per cent to $US66.8 billion. 

China's surplus with the rest of the world has jumped a massive 55 per cent to total just over $US61 billion for the six months to June, which puts it on track to easily top last year's record of $US102 billion.

This surplus has risen despite paying more for products like coal, iron ore, oil, copper, aluminium, zinc and a host of other commodities.

The 3.5 per cent revaluation of the Renminbi, China’s currency, a year ago has had no impact

The Chinese government however is trying to curtail the economy: reserve requirements have been lifted on property deals, interest rates have been increased and banks told to lend less.

Another sign of this hot economy was also given yesterday with the latest figures for car sales.

They rose almost 50 per cent in the six months to June: the China Association of Automobile Manufacturers reported total sales in the June half of 1.8 million units, up 46.9 per cent from the first half of last year.

The increase was equal to around 11 months of car sales in Australia, from all sources. 

Recent figures have shown a continued revival in sales following a slump in early 2004. Vehicle sales rose 21 per cent last year and 15 per cent in 2004 after that early slow down.
The surging car sales is a symptom of the boom across China (just wait until the pollution from all those cars is added to the existing levels of pollution in the country.) which is causing problems for the government.

And all that Australian iron ore, aluminium, copper and zinc being used in all those cars: its one very good example of what our exports to China will continue to boom.

The foreign exchange earned from booming exports has seen China's reserves to $US 875 billion (more than a trillion $A), the world's largest: an updated figure is due for release within the next week.

In turn the immense liquidity has financed and continues to finance this investment boom, car sales and the soaring level of consumer purchases.

Chinese demand has driven the boom in commodity prices over the past 18 months, which in turn has lead to an outbreak of inflation in countries like the US, in Europe and here in Australia.

It's not the only reason: Iran, the Middle East generally and North Korea are helping unsettle oil markets and drive prices higher but that strong Chinese demand (and rising demand from India and indeed the US and Japan) have helped underpin commodity prices.

Some analysts expect the trade surplus to reach $US130 billion by December (that would be around $A180 billion at current values for the Australian dollar).

The trade surplus will accelerate in the next six months as retailers in the US, Europe, Australia and elsewhere take delivery of goods for the big end of year holiday period when retail sales peak.

But while Americans are benefiting from the low-priced Chinese products, American manufacturers are not happy. They are continuing to lobby for controls or extra duties on Chinese imports because of China's controls on its currency.

But like so many muddle heads, these US businesses are missing the point: labour cost, plus the rising use of new technology, is why Chinese products are still cheap, not a relatively fixed currency.

China is running a huge trade surplus with the US (it was $US200 billion last year); it’s a mid-term election year with the campaign for the November poll about to swing into top gear: watch out for more China bashing.


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## YOUNG_TRADER (19 July 2006)

China has done it again!


Its growth has beaten all economists estimtes!

Are we all most over the wall of worry stage? 



Copper prices rise as China's economy grew more than forecast
--------------------------------------------------------------------------------

Copper prices rose in London and New York as the economy of China, the world's largest consumer of the metal, grew at the fastest pace in more than a decade.

*China's economy expanded 11,3% in the second quarter, the nation's statistics agency said today. That beat the 10,4% median forecast of 30 economists surveyed by Bloomberg News. The growth rate may signal increased appetite for copper, according to Kevin Norrish at Barclays Capital.*

“All the data signal usage of copper in China is pretty strong,'' said Norrish, a metals analyst at Barclays in London. “We've seen inventory drawdowns of copper both in metal and concentrate.”


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## noirua (19 July 2006)

YOUNG_TRADER said:
			
		

> China has done it again!
> 
> 
> Its growth has beaten all economists estimtes!
> ...





I would buy all this if I could not remember the previous mining slide after the boom in the 1970's. When I read what was written then it still makes me want to buy, however, I know the next boom was decades away. 

Inflation is rising in the UK, report out today, and interest rates are set to rise and mining stocks fell on the LSE. 
Increasing interest rates may take the UK and US up to 6%; This may well see a decline in demand from Europe and USA, and the boom in China is set to slow.

Mining stocks on the ASX will open lower in a few minutes.


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## YOUNG_TRADER (19 July 2006)

noirua said:
			
		

> I would buy all this if I could not remember the previous mining slide after the boom in the 1970's. When I read what was written then it still makes me want to buy, however, I know the next boom was decades away.
> 
> Inflation is rising in the UK, report out today, and interest rates are set to rise and mining stocks fell on the LSE.
> Increasing interest rates may take the UK and US up to 6%; This may well see a decline in demand from Europe and USA, and the boom in China is set to slow.
> ...





See I'm curious, do most people acknowledge that the World is an ever changing place?

If so then surely they must realise that scenarios are not going to play themselves out in similar ways if they are driven by different factors,

For example what was the Worlds Population in the 1970's?

What is it now?

What % of the worlds population are trying to purchase basic goods?

How long did the last mining boom last?

How long has this one been going? 

The boom in China has been set to slow for the last 2 yrs, the US dollar has been set to collapse for years, the US and AUS housing market has been set to collapse for years, 

While I acknowledge and give merit to the fact that some commodities (Copper and Nickel and even Gold) may be too high, they are not that far off an avg price for the next 5yrs, ie Copper avg of $2.50lb, Nickel avg of $10lb etc

The construction of roads/highways and Infrastructure in China and India (which will soon be on the headlines of news as the west is simply un-aware of the level of expansion over there) will take many years to finish

For now it seems we are still climbing the wall of worry phase!


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## Nicks (19 July 2006)

YOUNG_TRADER said:
			
		

> See I'm curious, do most people acknowledge that the World is an ever changing place?
> 
> If so then surely they must realise that scenarios are not going to play themselves out in similar ways if they are driven by different factors,
> 
> ...




Good post YT. Some sensible talk and I agree.
... and BTW most of my mining stocks have all opened higher.


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## blinkybill (19 July 2006)

I still reckon we are a long way off the ASX200 going back to its previouis all time highs and so the bull market that started back in march 2003 is over imo assuming that an uptrend is a series of higher highs and higher lows.

We'll go sideways with a fair bit of volatilty from here the way I see it, but if XJO falls below approx 4800 then the downtrend that started back in May will be confirmed.


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## YOUNG_TRADER (20 July 2006)

Some positive comments from Bennie Bo over in the US combined with suprise earnings upside seems to be kick starting US Equities,

Lets hope Middle East can stay out of the headlines for a bit so we can finally resume the Bull!


Most Basemetals up 4-6% (Zinc doing really well)

Oil down to $72 a bl (get down there!)

Gold held $620 support and now around $640 ish


Should be a good day tomorrow if gains hold overnight!


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## noirua (20 July 2006)

The 1970's boom was categorized by the rise in the oil price that moved to oil shale ( Central Pacific and Southern Pacific were two particular stocks that rose 30 to 40 fold before collapsing ). Oil rose from US$2 per barrel to around US$30 per barrel. The smallest sniff of oil and a minnow bounded ahead. 
Every mining stock rose dramatically and the smallest glimmer of hope and stocks raced ahead. Every tip sheet was covered with mining stocks and little else. ( One stock, Meekatharra Minerals ( Felix Resources ) rose to $12.00 ( equivalent to $120 ), Endeavor Resources ( St Barbara ) rose from 2 cents to $2.00 ).

Every one thought this could never end and future forecasts were made far above the 1980 price. It indeed came to an end as oil slipped down to US$12 per barrel and every commodity plunged.
An oil strike was treated as a liability and a copper or silver find as being hardly worth a light. Most of the mining minnows were picked up by the mining giants at a fraction of their former values or just evaporated. 

The crash in 1987 finished off many of the survivors and hardly a name - amongst the smaller resource and mining companies - survives to this day.

This is an answer to Y_T's post, number 69 - the bull is here already, hopefully it will stay.


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## blueroo (20 July 2006)

Y_T:

Looking at the time on your post 72, do you ever sleep or is your "Wall of Worry" keeping you awake  

Hopefully you are up drafting your informative posts for the following day.


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## YOUNG_TRADER (20 July 2006)

blueroo said:
			
		

> Y_T:
> 
> Looking at the time on your post 72, do you ever sleep or is your "Wall of Worry" keeping you awake
> 
> Hopefully you are up drafting your informative posts for the following day.




Had a late one last night, went out LOTUS bar, was good, they had a Miss Indy competition on last night, my girlfriend didn't seem too impressed with the scantly clad lases on stage but my friends and I were   

p.s. I think the Miss Indy finals are on next Wednesday (again at Lotus Bar, Toorak Rd Melb)


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## YOUNG_TRADER (20 July 2006)

blueroo said:
			
		

> Y_T:
> 
> Looking at the time on your post 72, do you ever sleep or is your "Wall of Worry" keeping you awake
> 
> Hopefully you are up drafting your informative posts for the following day.





Oh and 'money never sleeps' GG


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## YOUNG_TRADER (2 August 2006)

The fundamentals of the Commidity Super Cycle have not changed, if anything they have gotten stronger, why?

Well the one clear msg I am drawing from the Resource Sector in relation to new projects/supply is Cost Blow Outs, Delays, Lack of skilled people, lack of infrastructure, lack of this, more delays that etc,

So the fact that the underlying demand from 'Chindia' is still there combined with the even tighter supply conditions makes me assert, while the Bull has been held in the pen for much longer than I thought, when he finally gets released he is going to charge!




*Rest assured, the commodities boom is alive and well.

History shows us bull market cycles last an average 17 years.
It is therefore statistically unlikely that the end is near.
Keep in mind, this bull market in commodities started in 2001.
In other words, it's still only 5 years young.

More importantly, the fundamentals are as bullish as ever.

India has 1.1 billion people, and there's 1.4 billion in China.
In other words, 2.5 billion people are on the economic move !!!

Let's put that into context.

In 1804 the world's population reached 1 billion.
It was 123 years later, in 1927, that the total reached 2 billion.
It was circa 1948 when we hit 2.4 billion.

In other words, this particular tidal wave of people is equal in 
number to the entire population of the world just 58 years ago.

Forget the historical dynamics of commodity cycles.
Never before has there been a situation quite like this.

2.5 billion people are determined to urbanise and industrialise.

It's not a question of suppliers catching up with demand.
It's really a question of whether there's enough in the ground !!!*


Stronger for longer!


----------



## Sean K (2 August 2006)

This mornng it was reported in the Fin that China had taken over from Japan as the second largest user of cars. 14 million new users this year by memory. They are due to take over from the US somewhere around 2020. India will be closing in around then as well. 

I'm with you YT.


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## YOUNG_TRADER (6 August 2006)

EXPECT TO SEE MORE OF THESE IN THE HEADLINES!


Rio lines up a $10b year
4th August 2006, 20:15 WST


Mining giant Rio Tinto is on track to crack the $10 billion profit barrier for the first time this year, after the unstoppable China-fuelled resources boom powered the Anglo-Australian mining giant to a record $4.98 billion profit in the June half. 



Rio’s monster first-half net earnings of $US3.79 billion ($4.98 billion) *smashed analysts’ expectations * by about $US300 million, further proving that the mining boom is showing few signs of slowing despite sharemarket volatility and increased global tension. 

The result comes two weeks before Pilbara rival *BHP Billiton is due to hand down what is expected to be a record Australian full year pr*ofit of more than $13.8 billion, and coincided with a record $259.9 million interim profit by Australian bauxite and alumina producer Alumina. 

Speaking from London, Rio chairman Paul Skinner drily described the period as “an excellent six months” in which net earnings jumped 75 per cent, and total revenue rose almost 30 per cent to $US12.11 billion. 

And all the signs pointed to the good times continuing on the back of rampant economic expansion in China, which accounted for 14 per cent of Rio’s total sales, as well as continuing growth in other Asian countries ”” especially Japan ”” and in the US and Europe. 

*“Although we have seen increased volatility in financial markets, underlying demand for our products remains strong, and we remain positive about the outlook for the global economy and our markets,” Mr Skinner said. * 

*“China remains very important. The economy there continues to grow rapidly ”” above 11 per cent in the second quarter ”” and our view is that the demand outlook for China remains very positive.” * 

Mr Skinner said Rio was continuing to invest heavily to meet that demand. Its $US3 billion commitment to expand its Pilbara iron ore operations was “fully reflective of that intention”. 

Rio’s juggernaut iron ore division was a standout performer in the half, as higher prices dwarfed the impact of five cyclones to push profits 40 per cent higher to $US955 million. 

Chief executive Leigh Clifford said iron ore’s footprint was growing daily as work continued on a rolling expansion to lift export capacity in the Pilbara to 200 million tonnes a year by 2008, when the $US1 billion Hope Downs venture is expected to start production. 

Studies were also under way into a further expansion of port capacity at Cape Lambert from 60 million tonnes to 80 million tonnes a year. 

Remarkably, given the immense cost pressure being felt across the industry, Mr Clifford said all of Rio’s expansions were “on time and on budget”. 

“That doesn’t mean there are not cost pressures . . . it’s just that our construction teams ”” particularly those in WA ”” are alert to those,” Mr Clifford said. “It’s a reflection of a very capable team who properly estimate and take account of the efficiencies that are available.” 

Record prices also more than doubled profits at Rio’s copper operations to a staggering $US2.01 billion as gross margins topped 55 per cent. 

Rio’s other divisions did not miss out. Energy (coal and uranium) profits jumped 22 per cent to $US377 million, aluminium profits leapt 81 per cent to $US369 million, titanium minerals earnings rose 10 per cent to $US137 million and diamond profits rose 14 per cent to $US113 million. 

After promising in February to return $US4 billion to shareholders by late next year, Rio said it had already returned two-thirds of that amount and was considering new initiatives. 

Denying that position indicated Rio had run out of investment ideas for its mountain of cash, Mr Clifford said $US5 billion was already committed to project development while “conceptual projects” worth $US10 billion were being evaluated. 

“So we have tremendous organic growth opportunities . . . I can assure you the cupbard is far from bare,” he said. 

Rio shares jumped $1.49 to $76.15 ahead of the result.


----------



## swingstar (7 August 2006)

> Rio shares jumped $1.49 to $76.15 ahead of the result.




They dropped $1.65 on Friday.


----------



## YOUNG_TRADER (9 August 2006)

So the Fed has finally paused, after 17 straight raises they have paused, the mkts rallied at first, before players chose to focus on the qu of why did the fed pause?

A slowing US  economy? Obviously so, but is this such a bad thing for commodities? As I have asserted before, a slowing US economy won't effect commodities as much as most think, I firmly believe any demand shortfalls left open by the US will be met by the 'Chindiapan' trio and even Brazil and Russia and other parts of Europe to, just think, has any noticed how Brazil and Russia are begining to industriliase themselves, sure they are both commodity ich (Brazil in Metals & Russia in Energy particularly Gas) but the more they consume locally the less there is for export.

Wayne I would appreciate your view on this, I know your not the most bullish on commodities, but do you acknowledge that 20 years worth of underinvestment in the Resource Sector cannot be rectified by 2-3years of a boom mkt, Supply is still lagging with many so called new production mines being significantly delayed and running way over budget, there's no doubt that there's still plenty of Resources out there, its just the prices have to stabalise high enough to justify the investment


A note of concern, the Dow has failed to break and close above 11263, 3x (maybe 4x) now, I really thought Fed Pause would be just what the doctor ordered

So Mr Roach, I mean Wayne ( : ) your thoughts?


----------



## scsl (9 August 2006)

should we be worried about this?? i had to read some of it twice to make sure!   



> *Fed Probably Will Skip Rate Increase Next Month: John M. Berry*
> 
> Aug. 9 (Bloomberg) -- Now it's wait and see.
> 
> ...


----------



## YOUNG_TRADER (24 August 2006)

Just as the XAO edges up towards the 5100 level, whack and down we go, the fundamentals are there, the super profits are there, but so are the bears and the selling, this is taking way too long to recover to be called a correction   


Will have to seriously re-think my views and outlook to make sure I'm not holding on to blind faith


----------



## Sean K (24 August 2006)

I'm only buying gold, uranium and oil atm YT. And short term trading. Concerned for other growth stocks.


----------



## Freeballinginawetsuit (24 August 2006)

YOUNG_TRADER said:
			
		

> Just as the XAO edges up towards the 5100 level, whack and down we go, the fundamentals are there, the super profits are there, but so are the bears and the selling, this is taking way too long to recover to be called a correction
> 
> 
> Will have to seriously re-think my views and outlook to make sure I'm not holding on to blind faith




I think the Bulls are just being a bit more selective and not holding as long as they used to, unless the stocks fundamentally sound.

As for Kennas's comment, the two oil stocks I'm holding are behaving like pigs the last few days.


----------



## MichaelD (24 August 2006)

I just can't convince myself of this being a bear market despite the whole world declaring the sky as fallen.

Taking a step back and looking at the XAO and the first thing that still hits me in the face for the last 2 months is a series of higher lows with a few surges and pullbacks when the market gets a bit ahead of itself, not a series of lower lows.

Seems to me as if there's not all that much money being thrown around, and what little money there is heads for the exit all at the same time at the first hint of trouble, hence the slow climb up and then the dizzy descent to...not quite as low.

But what do I know?


----------



## nizar (24 August 2006)

We have not broken the underlying support since this bullmarket started in mid-2003


----------



## Sean K (25 August 2006)

Freeballinginawetsuit said:
			
		

> I think the Bulls are just being a bit more selective and not holding as long as they used to, unless the stocks fundamentally sound.
> 
> As for Kennas's comment, the two oil stocks I'm holding are behaving like pigs the last few days.




I've 4 oil stocks atm: OSH, HDR, BPT and BHP (I class that as oil too)

I've held these for over 2 years so they're still going OK except for that flee carrier, HDR. Think I'll be writing that off soon.

In regard to being Bullish or Bearish, I'm being cautious atm. Waiting for some positive direction and a clearer outlook for the US. If that's possible. I think I'm on the fence, leaning just over into the bear cage.


----------



## YOUNG_TRADER (25 August 2006)

Well at least DJIA is above and has held above its previous 11270 resistance level, this is now acting as support/consolidation, problem the same level for Aus XAO would be 5100 (I made a mistake in the past, I was concentrating on the XJO breaking 5100, not the XAO) I agree with others comments, the XAO must break above and hold 5100 for us to see a resumption,

One bit of good news is that a few coporate advisors I have been speaking to are saying that the US funds and such are finally starting to trickle back into to ASX after their May exit, a few are also hinting that due to the uncertanties in the North American region combined with the fact that all Aus miners trade on much lower P/E's has shown alot of new interest from US funds etc, 

So will be interesting to watch,

Still can't get over BHP's fall of last 2 days, record profit = a 7%+ drop, profit taking maybe but I think thats a little extreme,


----------



## YOUNG_TRADER (6 September 2006)

DJIA is well above previous resistance of 11,270 (Currently @ 11470)

XAO appears to have finally opened above 5100

and XJO is appears to be heading towards 5200 level,

So is the Bull back? Probably not yet,

When will he be back? Soon I hope!

How long will he stay for? Not long as October is around the corner a few weeks at best

Thoughts?


----------



## nizar (6 September 2006)

YOUNG_TRADER said:
			
		

> DJIA is well above previous resistance of 11,270 (Currently @ 11470)
> 
> XAO appears to have finally opened above 5100
> 
> ...




U know i was thinking about "red" october and maybe it wont happen at all; at least not to our markets; and if it happens it wont be as harsh as last time unless we run very hard the next few weeks.

DOW and FTSE are near their May highs but XJO and XAO quite far

Alot of money is already on the sidelines (since may-june) so any selling would be limited IMO

And so many people expect it; so it may just be self-fulfilling; but something this eagerly anticipated just may not happen because so many people are expecting it; last year it wasnt expected and it happened. The masses are hardly ever right in terms of predicting market direction

I will open an account with CMC so if the market does fall; i can short XJO and DOW and others if i see an opportunity


----------



## billhill (6 September 2006)

Seems a lot of volatility has gone out of the market in the last two weeks. Hopefully thats a sign of things to come.

billhill


----------



## YOUNG_TRADER (21 September 2006)

nizar said:
			
		

> DOW and FTSE are near their May highs but XJO and XAO quite far





Someone want to tell the aussie market the following info?

 $INDU   *Last: 11,613.19  * Change: +72.28  +0.63%  Volume: 226,387,852  

That means the Dow is 1 or at most 2 good days off its May Highs!!!!!!!!!


----------



## dj_420 (21 September 2006)

i agree yt

we follow the dow jones when its a red day, just yesterday dow down by around 14 so aust market took it down 50 something points.

now us stocks rocketing aust still thinks the world is crashing, aust market sentiment is ridiculous.

its all that negative attitude from lateline business, they are calling the resources boom a bubble now and stating that the run is over. to much negativity from media, im a fa of the stronger for longer theory BUT with this attitude we wil force ourselves into a bear market when the DOW will be at alltime highs


----------



## dj_420 (21 September 2006)

now our market is down. 

at these prices many stocks should be excellent buying but it seems the bears are in control.

uranium supply is running out
zinc supply is running out
nickel supply is running out
copper supply has only just met demand

world metal demand will remain robust during industrialisation of china and india


i dont understand the market sometimes, what will the rap be on lateline business tonight - 

following very strong leads from overseas markets with metals prices rebounding from a fall from world growth concerns, the aust all ords plunges amongst fear and confusion that the sky is falling. despite the fact that the dow is near highs made in may the aust all ords is still floundering around the 5000 point mark. 

sorry to sound sarcastic guys but can someone give me a reason why our market hasnt seemed to recover from the may correction but the us market has.


----------



## professor_frink (21 September 2006)

dj_420 said:
			
		

> i agree yt
> 
> we follow the dow jones when its a red day, just yesterday dow down by around 14 so aust market took it down 50 something points.
> 
> ...




dj_420, YT,

By that logic, we shouldn't have had much of a bull run over the past few years.

It looks like the very same thing that drove our market higher over the last few years is the thing holding us back presently. And it aint the Dow!

During the last big bear for the U.S(66-82) it actually managed to make all time highs in 73(although very briefly) before the bear really kicked in. Not saying that's going to happen this time, but it's something to think about.

In regards to the "stronger for longer" theory,

Look at the last commodities bull in the 70's- it wasn't a 10 year run straight up, there was an almighty big correction in the middle of it, before we began the run up that ended in 1980. Just another thing to think about.


----------



## Sean K (21 September 2006)

dj_420 said:
			
		

> now our market is down.
> 
> at these prices many stocks should be excellent buying but it seems the bears are in control.
> 
> ...




DJ, It's still off it's lows and just tracking sideways for a bit. Be patient. I've noticed money switching from commodities to healthcare and staples over the past few weeks which is interesting. I think they'll switch back once the Chindia story is confirmed to have more legs and 'supercycle' still apparant.


----------



## dj_420 (21 September 2006)

ill try kennas

its just very frustrating to watch dow performing very well and our market doesnt take notice.

some good points prof frink, hopefully we arent in the position for a huge correction, seems to me that we have already corrected a few times and cant seem to break 5000 and keep support above that level

oh well, im still not going to switch into defensive stocks, i think we have a while to run yet, especially for u and zinc


----------



## noirua (21 September 2006)

The bull may return, or a bull may return,  but may well be a different type of bull, that looks at different sectors to visit than those before. 

Oil stocks may well see oil trading in the US$50 to US$60 range from here and may well be suffering from higher production costs or lowered estimates on development of the newer oil finds. Many stocks are probably worth selling as the shake-out may not yet be complete.

Coal and iron ore is a more dodgy territory than before, note Macarthur Coals surprise withdrawal of its powerstation development, they may well see tighter times ahead for iron ore and pig iron prices with costs rising. The sector has been heavily dumped of late and some stocks may be good buys, beware however.

There are fears in the US that the bond market ( junk or trailer trash bonds ) is badly over stretched and a correction is due. Previous dumping in this market has seen much pain in the past. Worth reading recent articles on likely outcomes. 

The uranium sector may still have more running to do, though views are that most small stocks will come to nothing and will have eventual funding problems should markets slide in the sector.

If inflation turns downward it may be best to ignore the main ASX indexes, ASX 200 for instance, and look more at individual stocks, not involved in oil, coal and other mining activities or supplying the property sector.


----------



## The Mint Man (21 September 2006)

dj_420 said:
			
		

> i dont understand the market sometimes, what will the rap be on lateline business tonight -
> 
> following very strong leads from overseas markets with metals prices rebounding from a fall from world growth concerns, the aust all ords plunges amongst fear and confusion that the sky is falling. despite the fact that the dow is near highs made in may the aust all ords is still floundering around the 5000 point mark.
> 
> sorry to sound sarcastic guys but can someone give me a reason why our market hasnt seemed to recover from the may correction but the us market has.




Is it just me or were you watching a different lateline last night?
There was a whole segment dedicated to an interview with Bruce Teele, who stated quite clearly that comoditiy stocks such as BHP had been oversold.
So to suggest that lateline business was being bias is plain wrong IMO, otherwise thay wouldnt have ran the interview full stop...
Here is a link to that interview if anyone is interested:
http://www.abc.net.au/reslib/200609/r107760_333673.asx (windows media)
here is the link to the plain text Transcript http://www.abc.net.au/lateline/business/items/200609/s1745802.htm 

Also, I consider myself new to the market compared to some on here but, correct me if Im wrong, the US markets are much more diverse then the ASX. In other words we rely on the commodities more so then the US. Looking at the commodities list today (a sea of red) its not hard to see why were reacting.

cheers


----------



## nizar (21 September 2006)

XJO has been leading the way in global equity markets in the 3 years or so.
Lets not forget that while we increased by 22% last year, the DOW closed just as where it began ie. 0% return. So those that think we follow the DOW lead need to review the data.
And because of a poor calendar 2005, it makes sense for the DOW to outperform now ie. mean reversion.
Remember that while the DOW likes lower oil, XJO is more resource-heavy and lower oil and gold means stocks will be dumped.
RIO and BHP to XJO is just like BP and Shell to the FTSE-100.

While we have been rallying for years, the DOW hasnt, so the market is predicting that it is likely that the years of double digit returns on the XJO may be over. And history suggests the same.

LOng term view still looks good but im sticking to pure plays in zinc and pure plays in uranium. But be prepared to hold through volatility.


----------



## dj_420 (21 September 2006)

The Mint Man said:
			
		

> Is it just me or were you watching a different lateline last night?
> There was a whole segment dedicated to an interview with Bruce Teele, who stated quite clearly that comoditiy stocks such as BHP had been oversold.
> So to suggest that lateline business was being bias is plain wrong IMO, otherwise thay wouldnt have ran the interview full stop...
> Here is a link to that interview if anyone is interested:
> ...





i was been sarcastic

although on lateline they have been refering to resources as a bubble that will pop, any wonder sentiment turns negative. to compare the resources boom to the internet bubble is rididulous. i was watching couple nights ago and they were broadcasting a very negative mood


anyways we will see what happens


----------



## scsl (21 September 2006)

The Federal Reserve left the interest rate unchanged again last night. Will it be up from here for our market or will commodity prices fall and drag down our resource/energy stocks?



> Experts think the Fed could be finished raising U.S. interest rates
> The Associated Press
> 
> Published: September 21, 2006
> ...



http://www.iht.com/articles/ap/2006/09/21/business/NA_FIN_US_Fed_Interest_Rates.php


----------



## YOUNG_TRADER (25 September 2006)

An excellent report out by Abra on Aus and Commities and China and the world and well you get the picture, highly recommended reading!

http://www.abareconomics.com/publications_html/ac/ac_06/ac_sept06_2.pdf


Zinc forecast is higher next year than current spot


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## YOUNG_TRADER (4 October 2006)

Well Oil's down under $60 a bl, Gold fell again to $570 level, Aus RBA left cash rate unchanged, most commodities are still enjoying solid demand and prices have really been strong in terms of a 12 month view my favourites Zinc and Uranium are doing especially well, this combined with how the US mkts are performing leads me to ask the following question......


_NEW YORK (MarketWatch) -- U.S. stocks ended higher Tuesday, with the Dow Jones Industrial Average logging a new record close, after the price of oil slumped to a 14-month low, raising hopes falling energy costs will boost consumer spending and moderate any slowdown in the economy._


......Will the bull finally return to the Aus mkt? I think the first step would be an overall acceptance of the stronger for longer thesis followed by a return to stability,


----------



## Sean K (4 October 2006)

Morning YT.

Yep, we need steady oil prices for the long term bull to continue. I've read in places that between $50 and $70 will keep US cars on the road and consumers, um, consuming trinkets from Chindiapaniawan for some time to come. Let's just hope the US interest rates stay lowish, US housing market settles, yada yada yada... China keeps growing at around 10%.....The Bull Continues....

kennas


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## YOUNG_TRADER (5 October 2006)

Gold down to $560ish Oil still under $60 a bl and the dow all I can say is WOW


$INDU   Last: 11,850.61  Change: +123.27  +1.05%  Volume: 281,862,582   

*
Dow's triple-digit gain blows away record * 
_S&P 500 at multi-year high; Optimism on the economy spurs rally


NEW YORK (MarketWatch) -- The Dow Jones Industrial Average ended at its second record high in two days Wednesday, and the S&P 500 rallied to its best level in more than 5 1/2 years on increasing optimism that economic growth will continue at a pace that will sustain job creation and corporate profits. _ 

Base metals are weaker so look for more silly selling today in our miners and oilers, BHP OXR LHG BDG WPL STO will suffer today


----------



## MichaelD (5 October 2006)

If you ask me, the bull is definitely back. My in depth study of my patented, super-secret bull market indicator reveals...

An outstanding breakout has occurred in the number of posts on Aussie Stock Forums.

The bull must be back.


----------



## Sean K (11 October 2006)

I've noticed there are a lot more people logged on to ASF at any one time.

Surley this is a sign more punters are back in the market. When was the last peak? Around 14 May? No coinsidence. 

The bull is back.


----------



## rocket_science (11 October 2006)

but some of those aliases are mine  

not as many as you think are logged on  

btw, I think the market is a little more bullish. lets see for how long though.


----------



## Sean K (11 October 2006)

rocket_science said:
			
		

> but some of those aliases are mine
> 
> not as many as you think are logged on
> 
> btw, I think the market is a little more bullish. lets see for how long though.




Great avatar Rocket. You MUST be bullish!


----------



## bowser (11 October 2006)

Does that also mean another correction just around the corner? 

October 25th's fed reserve meeting might be critical for the bulls....


----------



## rocket_science (11 October 2006)

who knows bowser 

what with Nth Korea and OPEC possibly cutting oil production to keep oil above $60


----------



## YOUNG_TRADER (11 October 2006)

NYMEX shows Oil at a yearly low around $58.40 bl

Also re Noth Korea and Nuke, Mkts seem to be ignoring the issue, Dow had held strong and even moved higher a bit, while FTSE has rallied strongly towards previous highs as has our All Ords and S&P 200, no to mention the fact that Gold, the so called 'safe haven' asset has failed to rally, its sitting around the $575 oz level, so looks like the financial markets are not to convinced there is a real threat,


Have the Bulls finally returned in force? If BHP and RIO start to reach their MAY highs then the XAO and XJO will most certainly hit new highs,


http://www.fnarena.com/index2.cfm?type=dsp_newsitem&n=34A2ECDD-17A4-1130-F5DFD3458E4D6133


----------



## YOUNG_TRADER (12 October 2006)

Oil dropped again overnight to $57.50 bl,

Gold did nothing, even with the so called threat of North Korea and the possible Terrorist plane attack which turned out to be an accident (Gold is a dud now)

DOW closed down slightly in the face of hawkish Rerve Bank minutes, North Korea threat and plane attack confusion, but given strong rally over past couple of days its amazing that it didn't close lower on profit taking etc

So isn't it funny how little the mkts seem to care about this N Korea situation, sentiment really is everything and I think the heard of sheep are really starting to bunch together behind the Bulls,

Interesting read
http://www.fnarena.com/index2.cfm?type=dsp_newsitem&n=37AB0BFF-17A4-1130-F58E3D477B208B70

*Items of significance over Oct,*
- Zinc spot prices heading towards $1.8 high watch for breakout
- US Fed meeting 24th Oct
- Aus CPI figures 25th Oct (according to our new RBA Gov they hold the key for future rate decisions)
- Lots of 1st Qtr reports coming out


----------



## Sean K (12 October 2006)

YOUNG_TRADER said:
			
		

> Gold did nothing, even with the so called threat of North Korea and the possible Terrorist plane attack which turned out to be an accident (Gold is a dud now)




No YT, Nooooo!!!!!!!!!!!!!!!!!!!!!

Gold to $1000 by end next year. Why? Because I own a ton of gold! It's shiny, it's bright, $US to become worthless (maybe), war against the Axis of Evil, oil to $100 when the wells run dry (and war against Iran), BRICs stop investing in $US and turn to the Yuan   , Euro, and gold. blah blah blah....


----------



## YOUNG_TRADER (12 October 2006)

I can maybe see Gold turning after US elections when the powers that be no longer need to prop up the US $ and keep the Gold price low so as to help win an election, I reckon Gold will hit $1000 sometime during the next 12 months, but will wait for the trend to form before I move back in, good luck


----------



## Sean K (12 October 2006)

YOUNG_TRADER said:
			
		

> I can maybe see Gold turning after US elections when the powers that be no longer need to prop up the US $ and keep the Gold price low so as to help win an election, I reckon Gold will hit $1000 sometime during the next 12 months, but will wait for the trend to form before I move back in, good luck




He, he, cheers YT. 

I still agree with you that it's a bizaar commodity, and maybe it is just all sentiment driving it, but it is still there. I mean inherantly, what value does gold have? What does it power? What does it hold up? What other function does it have other than to just BE. Gold fillings? Give purpose to Fort Knox? Represent 1st place at the Olympics? Give relevance to the term 'that's gold dust'? So Ian Flemming can use it in every second book title? So Indians can represent their wealth in some way? Bizaar. 

"Go for gold!" Laurie Lawrence, circa last Olympics.


----------



## YOUNG_TRADER (12 October 2006)

kennas said:
			
		

> So Ian Flemming can use it in every second book title?




 

I know of a chap named Scaramonger who has a gun made out of gold  :


----------



## YOUNG_TRADER (13 October 2006)

Oil still under $60 and the records continue to tumble

FTSE is less than 15 points (0.1%) away from its may highs thats a whisker!

DOW up nearly another 1% to another record high

Even the Latin American mkts are closing at record highs,


Once the FTSE passes May high, the Aussie mkt will well and truly be lagging the global trend


----------



## YOUNG_TRADER (13 October 2006)

Article, enjoy

http://www.fnarena.com/index2.cfm?type=dsp_newsitem&n=3BC115AA-17A4-1130-F5179E53BB80D147


Also anyone have that report pubished by GSJB Were calling the '2nd wave' of the BUll Mkt in commodities now?


----------



## swingstar (13 October 2006)

YOUNG_TRADER said:
			
		

> Oil still under $60 and the records continue to tumble
> 
> FTSE is less than 15 points (0.1%) away from its may highs thats a whisker!
> 
> ...




Also, the DAX and French CAC 40 passed May highs yesterday.


----------



## YOUNG_TRADER (17 October 2006)

Wow just look at those Base metal price gains, tomorrow should be a good day   

change since 19:00 London Time 
Price: US$/lb   


Copper October 16,10:16 
Bid/Ask 3.5048 - 3.5111 
Change +0.1034  +3.04% 
Low/High 3.3673 - 3.5224 
Charts 

Nickel October 16,10:15 
Bid/Ask 15.4524 - 15.5431 
Change +0.3629  +2.40% 
Low/High 14.8174 - 15.5431 
Charts 

Aluminum October 16,10:18 
Bid/Ask 1.2209 - 1.2232 
Change +0.0213  +1.78% 
Low/High 1.1946 - 1.2232 
Charts 

Zinc October 16,10:06 
Bid/Ask 1.7934 - 1.7956 
Change +0.0829  +4.84% 
Low/High 1.7105 - 1.7979 
Charts 

Lead October 16,10:04 
Bid/Ask 0.7187 - 0.7219 
Change +0.0141  +2.00% 
Low/High 0.6992 - 0.7264


----------



## nizar (17 October 2006)

Zinc is the metal to be holding right now.
Last time the price was at us$1.80/lb - LME stocks was at 250ktonnes, now the is 125ktonnes yet the price is still us$1.80/lb.... 

Well IMO there will be a serious catch up so the price can better reflect the underlying supply-demand fundamentals of zinc metal.


----------



## YOUNG_TRADER (27 October 2006)

Looks like Mr B is back, no not Mr Bear, the other Mr B, Mr Bull!

I think he's brought a few friends to the party as well,

Only 2 trading days of 'dreaded October' to go, before its on to amazing November and December,

Its funny people are now talking about possibility of correction again but we've just now regained May grounds and guess what Resources aren't responsible for reclaiming XAO and XJO highs, XMJ and XEJ are well off their highs which tells me that mkt has a way to go yet, when XMJ and XEJ get close to their previous highs thats when its time to become cautious IMO


----------



## nizar (27 October 2006)

YOUNG_TRADER said:
			
		

> Looks like Mr B is back, no not Mr Bear, the other Mr B, Mr Bull!
> 
> I think he's brought a few friends to the party as well,
> 
> ...




agree yt
we've been waiting for the bull to return for ages, but it has been worth the wait 

this push upwards by XOA/XJO mainly due to industrials. Oil and gold are significantly lower than they were around the May highs.

id be careful about the november 7 elections, alot of people seem to think thats where this fairytale, at least for the DOW, will end... though their performance has been coming off the back of some very impressive quarterlies eg. wallmart, exxon, so hmmm... hard to say... but be cautious...


----------



## YOUNG_TRADER (27 October 2006)

nizar said:
			
		

> id be careful about the november 7 elections, alot of people seem to think thats where this fairytale, at least for the DOW, will end... though their performance has been coming off the back of some very impressive quarterlies eg. wallmart, exxon, so hmmm... hard to say... but be cautious...




I am, its been a conspiracy theory which I agree with that the powers that B, are manipulating Oil lower, Gold lower, the USD up and the Dow up,

Will watch cautiously


----------



## YOUNG_TRADER (30 October 2006)

CHARGE!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!


----------



## Sean K (30 October 2006)

YOUNG_TRADER said:
			
		

> CHARGE!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!




Ditto!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

Sorry Joe.


----------



## x2rider (30 October 2006)

Absolutely stellar day today with  dyl, eve ,nwr, kzl.
 Good you good things 

Cheers  Martin


----------



## krisbarry (8 November 2006)

With the Dow Jones rocketing to record highs this bull market will contine


----------



## Sean K (8 November 2006)

XJO up but commods down slightly across the board. Zinc might actually have a break for a day!

U phoria will probably continue, until the pro traders have a reason to dump. Will probably be a crappy reason, or just a little downward momentum that will snowball.


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## pacer (8 November 2006)

I thought you were a pro-trader kennas.....I follow your posts with enthusiasm ...good stuff, but it's copper falling me thinks.
Yup it needs a break on the zinc....but it appears to be a bull that is killing the bear ATM....still holding and buying....zinc up again and hitting the 100.000 mark
enjoy!....


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## Sean K (8 November 2006)

pacer said:
			
		

> I thought you were a pro-trader kennas.....I follow your posts ...good stuff
> Yup it needs a break on the zinc....but it appears to be a bull that is killing the bear ATM....still holding and buying....enjoy!....




he he. This is all I do but I couldn't possibly call myself a 'pro'. Maybe in another 20 years!   

Will be interesting to see the interest in the interest rate decision today, and how the market takes it. A rise is factored in, but the comments on status of the economy and future rises will be key. Any more rises in the foreseable future will hammer Vic and NSW, but might be needed to curb growth elsewhere. This two paced economy could be our undoing.


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## scsl (11 November 2006)

I think the latest run in shares will come to an end on Monday, with a pullback in the market overdue. I'm guessing that it might last about 2-4 weeks max, before the majors such as BHP and RIO take the main two indexes to newer highs.

Copper, aluminium and zinc are all currently more than 3% down and I think this will see the recent gains (some ridiculous even) in shares taken away. This might not happen on Monday, but I look forward to when it does, so I can load up on stocks like BHP, KZL, ZFX, OXR just to name a few.


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## Sean K (11 November 2006)

scsl said:
			
		

> I think the latest run in shares will come to an end on Monday, with a pullback in the market overdue. I'm guessing that it might last about 2-4 weeks max, before the majors such as BHP and RIO take the main two indexes to newer highs.
> 
> Copper, aluminium and zinc are all currently more than 3% down and I think this will see the recent gains (some ridiculous even) in shares taken away. This might not happen on Monday, but I look forward to when it does, so I can load up on stocks like BHP, KZL, ZFX, OXR just to name a few.




Monday looks like a killer especially for the minnows. How quickly things change. It was just a couple of days ago that we were almost out of zinc. That hasn't changed has it? Then why the price decline?


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## billhill (11 November 2006)

scsl said:
			
		

> I think the latest run in shares will come to an end on Monday, with a pullback in the market overdue. I'm guessing that it might last about 2-4 weeks max, before the majors such as BHP and RIO take the main two indexes to newer highs.




Have to agree we are due for a decline. Don't know if will happen monday though, but to my mind the market is looking fully priced. I've really struggled to find companies in the top 300 with good value in the last month. Mind you i don't follow commodities so can't really say how their current status will affect the market.


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## YOUNG_TRADER (11 November 2006)

kennas said:
			
		

> Monday looks like a killer especially for the minnows. How quickly things change. It was just a couple of days ago that we were almost out of zinc. That hasn't changed has it? Then why the price decline?





As $1.80 was previous resistance for Zinc, it will now form support, I was expecting a pull back in Zinc price to test $1.80 support before marching higher, as you say fundamentals are still there, as are the technicals



As for the whole mkt, I've been expecting a pullback as well, though I doubt it'll come monday, next week probably but not sure if it'll be monday, I expect XAO and XJO to pull back to May highs as support


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## CanOz (11 November 2006)

billhill said:
			
		

> Have to agree we are due for a decline. Don't know if will happen monday though, but to my mind the market is looking fully priced. I've really struggled to find companies in the top 300 with good value in the last month. Mind you i don't follow commodities so can't really say how their current status will affect the market.




I'm 43% cash atm and sitting with tight stops on my other trades. Roll on decline i say. 

Futher to a suspected pullback, it could be led by a decline in Uranium stocks too if there is any substance to the article in the AFR today on page 43.

Cheers,


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## chops_a_must (11 November 2006)

I'll be looking at offloading most of my resource stocks apart from MCR on Monday morning, while I can still get a decent price.

And then buy back in when I think it's bottoming out.


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## billhill (11 November 2006)

CanOz said:
			
		

> Futher to a suspected pullback, it could be led by a decline in Uranium stocks too if there is any substance to the article in the AFR today on page 43.




CanOz, What is the jist of the article if you don't mind.


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## nizar (11 November 2006)

CanOz said:
			
		

> I'm 43% cash atm and sitting with tight stops on my other trades. Roll on decline i say.
> 
> Futher to a suspected pullback, it could be led by a decline in Uranium stocks too if there is any substance to the article in the AFR today on page 43.
> 
> Cheers,




75% cash myself.
If we have a correction, im buying - but only on the way up.


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## CanOz (11 November 2006)

nizar said:
			
		

> 75% cash myself.
> If we have a correction, im buying - but only on the way up.




Maybe it would be interesting to start a poll on what level of cash everyone is in atm?

What do you think Nizar?


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## nizar (11 November 2006)

CanOz said:
			
		

> Maybe it would be interesting to start a poll on what level of cash everyone is in atm?
> 
> What do you think Nizar?




OK but i dont know how to set it up.
Also - im curious as to how u get access to the financial review from china?

I read that article on pg43 just now - and im really keen to know about paladin; how much of its uranium is being sold at contracted prices instead of spot. Because last week i read an article saying that 25% of its forward production was locked in, and this article says less than 50%.

From paladins announcements, my thinking was that their was NO hedging at all, and that all of their uranium would be sold at the spot price.

Can any1 else share some light on this?

Also - does any1 know how much of Olympic Dams production is sold at contract prices, at what price and until when?


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## nizar (11 November 2006)

CanOz said:
			
		

> I'm 43% cash atm and sitting with tight stops on my other trades. Roll on decline i say.
> 
> Futher to a suspected pullback, it could be led by a decline in Uranium stocks too if there is any substance to the article in the AFR today on page 43.
> 
> Cheers,




There is really nothing new in this article.
Except maybe some people didnt know that ERA sold its uranium at us$16.50/lb - but thats their own fault for not doing due diligence, but who cares anyway, its share price still goes up with the uranium hype!

The article is just about hedging and how the uranium price was low, and nuclear reactor prices require certainty so todays producers, namely WMC (now BHP-owned) and ERA sell their uranium at well below the spot price.

Does any1 know how it works with Cameco? I still havent got over how some of those mines in canada have grades of 20% and we hear get excited over 1% - thats pretty sad...   

I have contacted ERA, and they have informed me that they are about 2 years away. With that and the fact that Jabiluka is still being disputed by the traditional owners, i have banished this from my watchlist!


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## CanOz (11 November 2006)

nizar said:
			
		

> Also - im curious as to how u get access to the financial review from china?




Its a digital version for expats. I download it every morning and read it my lappy. Same price, or close to the newsstand version.

Cheers,


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