re: lme stockpile down 2650 tons monday night jhamann,
I think that's a fair plan.
I've never shorted ZFX overnight. I take profits when I see them during market hours when it's within my control.
There're about 3 things that procure a bear market.
(1) Overevaluation
(2) Interest rates
(3) Recession
We are not in #1. We are in #2, and if #2 brings on #3 we're in a downtrend for the rest of the year. A recession is defined as 2 consecutive quarters of GDP retraction, and we're halfway there.
It's not a matter of whether the US raises rates, it's whether they'll continue applying pressure to breaking point, which seems to be the case. The implication is no commodity driven market will hold up.
Consider this. When inflation becomes a problem, markets are close to the top. When rates are subsequently relaxed, they start trending down long term because of a lag effect that's difficult to measure. The Fed/RBA act in response to the market not the other way around, so by the time they do anything it's usually too late. This is then compounded by slowing growth. So the tail end of hiking cycles are inversely related to economic expansions. You can use yield curves as an indicator. The best time to invest is at the start of a new rate hike cycle.
All this suggests to me that the so called super cycle can drag out another 1 or 2 years max.
You can feel the US is in dire straits this time because their market never reacted this poorly to previous hikes. They're sending a big statement that a hike beyond 5.50pc becomes globally alarming.
I need to see ZFx's financial statements to measure what the sp should be. Nevermind what brokers say at this stage can't be sure. It could be 9.00, 10.00, 8.50 ...
For now 8.00 is support.
Be prepared for 7.00.
I think ZFX is worth about 9.00 but have been too lazy to analyze it. Been busy with futures baby.
Heh.
ZFX
zinifex limited
