wa1 Chart, page-2588

I have been keeping one eye on the BHP charts both in Aus and the US over the last few months. Partly because the fortunes of niobium are somewhat tied to IO demand and partly because one might consider BHP as a proxy for the commodity cycle.

Have a look at the BHP chart in the US as of this morning and note 3 things:

1. BHP peaked out in late May as did WA1. Back then I was thinking WA1 might have gotten a little overheated at 23 bucks in the post budget excitement over critical minerals and the renewable energy movement but maybe it was just a cyclical top.

2. Note the recent double bottom on the BHP chart. Im
thinking now that was a cyclical bottom and that the market has anticipated this which is why WA1 moved up strongly this week.

3. look at last night’s candle. A decent gap up from
the double bottom and a strong night overall for BHP up over 3%.

if my theory is correct then this recent weakness has nothing to do with shadowy shorters or the Lassonde curve. This may have just been a sector wide bit of softness for commodities generally which may now be behind us if BHPs candle from last night is really telling us this. That being the case we can now expect a rapid return to over 20 bucks.