Ann: Export Coal Sales - December Quarter Update, page-47

re: Ann: Export Coal Sales - December Quarte... Trossell - I have been thinking about this quite a bit...

To be honest I don't think that any one theory to explain what moves the markets will be conclusive as there are so many different players with conflicting agendas in the markets.

The VSA (Volume Spread Analysis) that Toll and Funky are using has alot of merit and probably is adequate to explain most events but a flaw in it that I can is that it appears to assume that everybody active in the markets are short term trading. To be blunt it is very simplistic.

So it goes that the smart money are buying low and then when large volume pops up with selling that is the smart money offloading.

What about the large volume of long term investors in the market including many of the large funds with billions under management? Many of them are very smart and if they have a long term agenda they may need to purchase when there is large volume and you can end up with smart money selling to smart money.

What would happen if come the start of January three major funds want a long term 5% stake in Conti? Well you will get a price rise, but what will the smart money be doing?

Just one example of why it can be difficult to define exactly what is happening.

To do that you would need to ring every single person who traded and ask them why they did...