Nice to see a stock discussed from an international perspective and with top down analysis. Could not agree more about Greece and the potential that this may explain the buying however would argue that they may not look to sell when Greece gets its package.
The IMF is already in (committed) the rest is political posturing IMO as the ECB and French / German banks are threatened to their core, based on contagion in the EMU, if there is a default now. This is why there is a repo window open at the ECB to purchase toxic PIIGS bonds at this time even if the time is ticking - it was set for three years.
This time was bought to enable the tangle of counter party risk to get sorted as much as possible. The Euro banks are headed home, not rolling over PIIGS debt, letting it mature and even being selective about local issues such that they are decreasing risk all the time. The real threat comes from Ireland IMO as they will fight. it is their nature and this is where a really nasty fire may start but even then you watch the frantic hosing down and special solution evolve as required.
The buying on this Aussie gold sector began last week and the Lihir Island power outage distorted the technical view this week on the XGD and NCM. But KCN, RRL, OGC and even RSG have recovered from lows already. SBM is still mired in possible CAH take over / merger or it would have joined them as well. BDR, RMS and FML joined the ranks late this week because this is buying season, the technicals say so and so does the market behavior as I have been reporting to my clients in detail. They were selected carefully and there may be more to come if I am right.
What you mention about a JPM could be true as agreed however this may be indicative of more of this type of buying to come in the sector over the near term. Smart buyers indeed sophisticated so it will be very bumpy as these guys will NOT drive any one stock far off the bottom range ahead of time. They will interfere as you put it in a big way increasing volatility across the sector if we are headed for a major gold stock rally which is long overdue.
The ASIC speeding tickets are an automatic mechanical response as you say - very astute.
Only time will tell if I am right but the writing is emerging so thank you for sharing your view with us K it is all entertaining.
Very best regards, CW
FML Price at posting:
7.7¢ Sentiment: LT Buy Disclosure: Held
