where is bhp at, page-7

Shares in mining companies react differently to the current commodity prices because the share market is forward looking wheras the current commodity price needs to rise or fall to meet those forward targets. The BHP price drop to $20 would have occurred due to the fact that people saw the future price of commodities deteriorating further which they did and the subsequent rise was on the basis that people's outlook is for commodity prices to rise over the short/medium term. I think you will find that the average price projection for oil for 2009 is around US$60 barrel as the $60/70 level is the true cost of production! The fall in AUD has lessoned the impact of the drop in commodities for BHP and others and thus we are seeing prices rally. $32 resistance is a logical area to short BHP but noting that I and a great many others expect the market to correct for a week or two before we get our final Obama optomism surge over a 4-6 week period to a wave B top I would not be betting the house that BHP $32 resistance will hold on its next assault in the coming weeks. Play the charts and not the fundamentals if you are shorting! Blind freddy can see that there are a significant number of ASX200 shares that are all sitting at resistance levels ready to break out. Some like BHP, PDN,WPL,STO did breakout but have fallen back below the breakout levels indicating a false breakout. The next assault when it comes in a week or so may be the real thing. The oilies are mostly looking bullish and if the case BHP may get some momentum from oil. IO stocks also looking bullish and are correcting their latest move! Weekly stochastics are all rising above 20% on most stocks with a bullish outlook indicating that a multi week rally is in progress wheras the daily's have triggered sells indicating the current short term rally's have peaked and a healthy retracement is in progress. Fundamentally all these stocks may revisit or post lower lows in 2009 but trading is alll about timing. I shorted WPL at $55 only to be stopped out when it rallied to $65 before it fell continuously to $26. Play the charts not the perceived or expected fundamentals is my advice! Brokers make recommendations on fundamentals and as you are all aware they have been wrong for the best part of 12 months and will probably be wrong for another 12 months!