There are four months until the next dividend, we are a third of...

There are four months until the next dividend, we are a third of the way through this cycle so I would expect plenty of investor speculation over the next two months seeking to first sell out for a profit and then buy back in hard prior to the next dividend.

That's why I say this next third of the cycle will be the volatile one, Chinese competition for market share and price movement aside. This is the period where people want to lock in gains and buy a bargain. That's what I will be doing.

The trick will be to buy in at a point where the sellers have over sold but prior to those same investors, and more like me, will pile back in.

I am a big believer in the market moving by numbers, but momentum of emotion. So there is a mental emotional point at $20. I suspect that will be difficult to buy back in above because the representation of value at 19.99 emotionally seems so much better than 20.01. I also think that the buyers will be surging hard on the perception of value under 20.

Very few will look at the output potential of Chinese mines to replace Australian iron ore mines, budgeting for a reduction in price to around $105/t and then estimating the corresponding share price for that dividend payment based on historical dividend to share price ratios.

$23 high with a 20% discount is $18.4, rebounding to $20.24 is +10% - $1 dividend = 5.43% return on buy in price 2 months post purchase plus 10% in value.