Australian (ASX) Stock Market Forum

Zinc - The Metal for 2007

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I don't go in for much chart analysis, but just looking at the 60 day poz (from kitcometals) since 2 April 07 it looks like higher highs, and higher lows, which seems to be a good sign for my zincies.
 

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wavepicker said:
The forecast back in late December was for Zinc to undergo its largest correction since it bull began. This was at when Zinc was trading at 4500. Most fundamentalists were calling for a climb to 5500 back then. We said back then that Zinc would “see 3000-3500 before it would see 5500’.
Cheers
Click to expand...
Zinc's "big picture" has not changed in the past few years - it remains bullish, and is getting tighter.
The correctly forecast correction was exacerbated by an arbitrage opportunity in China that ran for a quarter and has now abated.
Zinc inventories are extremely tight and it will be instructive to watch the new Shanghai zinc exchange or possible clues about east-west metal flows.
With the best analysts in the metals sectors continually under-estimating base metals demand in recent years, it will not surprise if they end up getting zinc's "balance" in 2007 wrong.
So far zinc analysis has skewed in favour of oversupply due to Chinese destocking in 2007. It has been supported by various industry sector slumps in the US which led to very little drawdown at New Orleans (which contains about half the available zinc that's warehoused).
New Orleans has recently perked up with cancellations increasing there as well as at Singapore -which has over a third of inventory cancelled.
A near term continuation of present inventory flows will see zinc surpass its 2006 prices, and probably lead to funds re-establishing themselves as key price drivers of this metal.
 
Lucky_Country said:
AAR sounding like a good zinc play but early stages
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Lucky_Country I agree entirely.

AAR has gone completely under the markets radar. With a JORC Indicated reserve now delineated over 7-7.7% Zn the in ground value is over $US1b and now progressing to advanced DFS stage for mining and testwork. Add to that the Cu, Pb and Ag and you have one hell of a base metals company with a low market cap and cash rich producing gold mine to go with it. I am now watching the latest base metals addition being Victoria Downs in the NT.

It is simply a matter of time before the market awakens to AAR value.
 
hangseng said:
Lucky_Country I agree entirely.

AAR has gone completely under the markets radar. With a JORC Indicated reserve now delineated over 7-7.7% Zn the in ground value is over $US1b and now progressing to advanced DFS stage for mining and testwork. Add to that the Cu, Pb and Ag and you have one hell of a base metals company with a low market cap and cash rich producing gold mine to go with it. I am now watching the latest base metals addition being Victoria Downs in the NT.

It is simply a matter of time before the market awakens to AAR value.
Click to expand...

Well the market woke up today.

Over 10,000,000 traded with 6m of it in the last 10 minutes or so. Sp from 5.7 - 6.4 at close at buyers accumulating. Most sales off screen today with very large single trades going through.

With advanced study stage in progress is this the next Zinc producer?
 
Magdoran said:
Latest Zinc Chart
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How does your current chart on Zinc validate in retrospect youre musings on the one posted on the 27/02.

I know nothing of EW so would be keen to see if it all panned out the way you thought it would.

I have however accumalated Zinc related producers over the last few months on the simple assumption that the downtrend was cyclical/ exit of speculation form the mean during this period. For me the dynamics driving Zinc relative to demand....... remained reasonably predictable from a forward view.

Surely those that speculated on such a scenario and due to the cyclical nature of such speculation........................the cycle repeats again.
 
Freeballinginawetsuit said:
How does your current chart on Zinc validate in retrospect youre musings on the one posted on the 27/02.

I know nothing of EW so would be keen to see if it all panned out the way you thought it would.

I have however accumalated Zinc related producers over the last few months on the simple assumption that the downtrend was cyclical/ exit of speculation form the mean during this period. For me the dynamics driving Zinc relative to demand....... remained reasonably predictable from a forward view.

Surely those that speculated on such a scenario and due to the cyclical nature of such speculation........................the cycle repeats again.
Click to expand...
Based on post 110 of this thread, the analysis in conjunction with the cycles work I’d done on ZFX, the day to go long ZFX for a stock trader was the 20/04/07, and the 23/02/07 was the time to go long for May options (if OTM based on volatility and theta decay – there was so far around a 700% gain to be made with $17 May calls – 0.12 to over 0.80). Hence the cycle was spot on.

Firstly for every one else, please understand that this is an ongoing one way mudslinging match initiated and perpetuated by Freeball, who pushed his insulting “each way bet” line (accusing all my analysis of fence sitting without understanding the concept of forecasting with inbuilt failure criteria), and forced the adoption of making long range forecasts without the failure criteria incorporated.

Zinc interestingly enough actually followed the forecast quite faithfully for weeks before the price action rallied. See Post 1473 05 March 2007 in the ZFX thread – Look at the chart posted there and the actual path of Zinc from this point. The pattern for a long time was very close to the forecast but the creeping trend which was correctly drawn on the chart resolved UP not DOWN. This is quite normal for markets to do this, and didn’t invalidate the time cycle at all.

The style of technical analysis I follow is primarily time cycle based, and relies on adjustments based on how the pattern unfolds. Hence some long term forecasts can be spot on the whole way, while others have criteria which trigger adjustments. Zinc in this case invalidated the bearish capitulation possibility late in the forecast, and the pattern demonstrated a bullish scenario as being the highest probability from the pattern as it unfolded. I posted this in post 110 on this thread.

For those people who understand McLaren’s concept of the “type of trend” will recognise the significance of the pattern here. The 15 of April was a key date in the cycle, which was my main focus. Time not price. The fact that Zinc rallied up and pulled back into this date told us a lot about what is going on. Hence as the pattern unfolds, adjustments need to be made.

The 15th of April was a key date as was forecast, and was the termination of the bearish cycle. The fact it was a higher low is very common in commodities, and is often a signal of the commencement of a very sharp bullish drive for a limited period. The price action so far has borne this out. I think the cycle is still working, and major cycle lows can actually end up being higher lows in price and pattern. Hence I have forecast in time where I think Zinc may move to in a blow off style move. The key April 15th cycle completion date was at an important juncture (the key higher low), so the cycle is still valid, which is the main thrust of my style.

I have never claimed to have a crystal ball, and never claimed 100% accuracy, hence the use of failure criteria are required to reappraise forecasts as events unfold. How many people can trace out the exact pattern of a stock or commodity or index, complete with exact prices and times, and get it 100% right 100% of the time? If I am to be criticized for making many forecasts on the ASF and not being able to do this perfectly 100% of the time in all respects, please, someone show me how this is done (how about you Freeball?).

In fact, I don’t remember Freeball accurately projecting when the bearish move in Zinc would end, or how long this rally will last on this thread, does anyone else? Where is his projection with exact dates and price levels? Where? It’s really easy to sit on the sidelines and take no risks and say nothing, then pop out when a complex forecast is made and doesn’t work precisely. Most of the time Zinc followed the projection like clockwork. It’s still hitting the dates which is the primary element in my style. Where is Freeball’s projections?



Freeball:
Now, Freeball, in answer to your comment, have a look at post 110 on this thread; it says it all - If you’d bothered to read it.

You only have one objective here Freeball, to beat your chest about how good you are and the need to put others down to feel good about yourself. You don’t have much of a generosity of spirit, do you?

You also have no interest in the work I am doing, and haven’t bothered to even look at any of my detailed posts on the subject of technical analysis. If you actually had any genuine interest you would understand what I’m doing and why. All you have is insults and one upmanship with no substance behind it.

You repeatedly fail to grasp simple concepts like probabilities, and the need to incorporate failure criteria into technical analysis. You haven’t understood that this style is based on TIME, NOT PRICE. It is designed to locate high probability swing trades. That is exactly what post 110 does, doesn’t it?

I’d love to see you post exact time and price points and the expected path as I did in my posts with an accuracy to match the majority of my calls on ASF. Let’s see you step up to the challenge now and make your forecast well ahead of time, with time points and price points, and the exact path that Zinc will take just like I did. Don’t just attack and criticise, step up to the plate and show me how good you are.

If you don’t have the courage of your convictions to take up the challenge you’ve created, you aren’t worth any further trouble Freeball, and you’ll have shown yourself to be a hollow man with no substance.

I look forward to seeing your precise forecast in due course.

Magdoran
 
Why don't just buy zinc futures to get exposure to zinc rally?
Zinc goes up, zinc producer may not go up.;)
 
BREND said:
Why don't just buy zinc futures to get exposure to zinc rally?
Zinc goes up, zinc producer may not go up.;)
Click to expand...
I agree fully... better to trade the underlying, but the comment was directed to our little friend who trades stocks not commodities...
 
Magdoran said:
TIME, NOT PRICE. It is designed to locate high probability swing trades.
Magdoran
Click to expand...


Hi Mag,

I do have an interest in EW (especially the time component) and follow Kauri's posts. Although a noob on EW specifics it seems to correlate to my entries/exits on trades.

Agreed that I don't trade the commodity and rather just the equities and have for some time.

Like anyone, I get my calls wrong on occasions :) and in the case of Zinc started accumalting the equities this time around 10 odd percent off the bottom. They overshot value IMO but speculation past the mean on upward/downward momentum is common.

No need for me to post my last lot of Zinc trades, theyve been and gone and I took profits short (still have some longs though), dividends and all :D .

I did however take final large positions only days before Zinc equities trended in recent weeks. Even suggested at the time to a fellow poster on ASF over some beers that IMO Zincers would push in a matter of days.

I admire youre time and effort you put into youre postings Mag, youre obviously knowledgable/dedicated to EW.

Personally I find the constant chest beating to your EW chums/March's effort and condecending banter silly.

IMO its all about getting returns out of the market and protecting youre capital.............simple. How its done is up to the individual and thier are many methods, some times the simple ones are often the most effective.

Cheers

And by the way I clearly posted my views on the top of the last Zinc cycle in the stocks I trade and the reasons for my exit (and entries), whilst most were spouting blue sky. As with my initial entry at the subsequent downtrend, albiet a bit early.
Like the liquidity/speculation near term that has traded Zinc equities, its all about the underlying mean fundamentals. The charts indicate this after the fact and once positions are taken.
 
michael_selway said:
Hi Red you were right about Nickel

do you think $10000 for Zinc might be achievable?

thx

MS
Click to expand...
Not in the medium term!
We will need a few major zinc projects to run off course.
The prognosis now is for market tightening to continue.
The next 12 months suggests balance to slight supply surplus.
Now I'm not suggesting the people that know more will get it right - they just know more!
Let's see if zinc can parallel copper for the time being: Noting that copper has yet to fathom $10k.
I reckon a 3 year $10k target is possible for zinc on an overly optimistic basis: Not one I am yet willing to put my name on tho!
 
Can Zinc supply keep up with demand ?
AAR and Zinc could do us all very nicely thats my tip
 

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