chart 01-10-09 , page-2

farlap,

The chart certainly suggests that it is oversold. If you have time on your side, sit it out IMO.

A couple of things to consider:-

1.The ore is there and it isn't going anywhere;
2.They're producing, selling and developing it;
3.FMG is a competitor to BHP & RIO (albeit on a smaller scale at this juncture;
4.The Chinese are interested in FMG (providing finance);
5.The Chinese want to develop the relationship between FMG and themselves;
6.Twiggy is courting the Chinese and is succeeding;
7.The Chinese need and will need iron ore and FMG is well placed to provide it;
8. Finally, the short sellers, by nature, are technical people and they are looking at the same charts we are. Given this, the first one (short sellers) to turn and run the other way, will cause the rest to follow and fall like dominoes and the SP will turn around. IMO, that point is not far.

Cheers