Signs Of ... Alarm BellsPersonally I locked in some profits...

Signs Of ... Alarm Bells

Personally I locked in some profits earlier in the week, and was clearing the decks to move to the new strategy of just following the money in the hot sectors, but I was still holding three iron ore stocks in GWR, AKO and FEL. Thursday night the first GWR shipment was meant to be leaving the port, we'd have the cash in the bank, and were about to announce our expansion plans, which were expected to include two shipments in February. The price of Iron Ore had dropped from $170 to $165 with China threatening to close their steel mills as they were making a loss. This would of course mean that China could not possibly achieve their growth targets, so I always take their bullying and lies with a grain of salt. Memo to New Xi-Land ... ye who can have mature conversations with the Chinese ... did you have the conversation with them that went "you were a bit uncomfortable with how China was trying to bully Australia, and it made you uncomfortable that one day China might do the same thing to you"? GWR and AKO hit 15% on Friday afternoon. Ouch.

Anyways, off my high horse, and grateful to be holding 80% cash in my portfolio when Friday afternoon struck.

There were two alarm bells that I did not heed. Firstly, the All Ords had a shocker on Thursday, but the bargain basement did not quite get hit as hard as you might expect. Secondly, stocks in the "5 cents to $1.25 range" were having a poor week, which I didn't notice until this morning.



Stocks under 5 cents that did OK this week ... 40 (compared with 46 last week)
Stocks between 5 cents and $1.25 that did OK this week ... 45 (compared with 107 last week)

I can't see a hot sector.
I can't see a flight to gold.
The price of silver had two good days, but silver stocks were luke warm due to a few recent false starts.
Lithium and Rare Earths stocks had a pull back.

I've been looking at taking a position in Rare Earths (IXR?), but prices in that sector had been going up vertically. Maybe this is my chance, or maybe I should wait a bit longer? ARU chart an example of what happened ... sitting on a 38% retrace ... will that extend to 50%?




As for iron ore, GWR has also had a 38% retrace, and will have some positive announcements coming up, but the price of Iron Ore will have the final say.






The Dow Jones is having a bad night, which won't help us on Monday morning. Is this the start of the "correction we had to have"?



Sorry, but all I'm getting from the end of this week are alarm bells