falling, page-2

THE SP will rise with the POS in AUD.

I have to say it looks grim. I am reminded of MOL and when I sat on a 90% loss on my original investment there.

At the absolute bottom, I bought some more, and with the rise of the market, I got out when my money returned and a modest profit. Have a look at the graph of MOL over the last few years. I think Cobar is in this league. That means, it can be brutal on the way down, but you must be ready for a dramatic leg up. That's when you need to act.

This company is getting ready to mine its resource. As we have seen, that means that any prior fanciful announcement on the ASX is dashed.

I think it is far more rational for a company to be very conservative about their resource estimates.

This attracts investors. Let's hope Cobar management refrains from spruiking. It is very disconcerting to investors for management to state guesswork as fact. Far better to be prudent and stick to cast-iron knowledge.

I won't buy any more CCU until there is a clear bottom in the downtrend. That may be painful, but less painful than catching a falling knife.

The forces of darkness are amassed.

The ASX XAO has resistance at 5000 or so, it seems. A fall is in the wings, unless earnings pick up.

I don't see silver rising dramatically on industrial use fundamentals, in the near future. Long term, Asia is poised to absorb it as soon as it comes out of the ground.

For now, we have to look at the POG for some upside. My sense is the US market is teetering on the next stair of the dead cat bounce. There are lots of factors in place which support strengthening of the USD in the near term.

That is bad for gold. Therefore, bad for silver.

But it is good for America.

I see no reason to buy more in this company until we see a convincing bottom and a game plan from CCU, with the cards on the table.

So, short term, in the absence of any unexpected positive news, I won't be buying.

About 12 cents, all being equal, I will.

You may be interested to look at how well silver can do, to prepare for the upside, which will come. At the end of the rainbow, is a pot of silver :)

I'm posting a link to Infomine, which is a nice site to compare commodity prices in various currencies over time. You can plot the POG and POS on the same graph.

This one is the POS for 10 years in AUD.

http://www.infomine.com/investment/charts.aspx?mv=1&f=f&r=10y&c=csilver.xaud.uoz#chart

Looks like a sold uptrend to me, consolidating. You can see how devastating the effects of late 2008 were.

Then you see the very dramatic upsurge into mid 2009.

What you can't see is the correlation with gold on that dramatic upsurge.

In this graph you can.

http://www.infomine.com/investment/charts.aspx?mv=1&f=f&r=2y&c=csilver.xaud.uoz,cgold.xaud.uoz#chart

Note that gold bottomed and picked up before silver.