It would be naive to think that most of the action on CCU is long-term investment, IMHO. It is being worked as a pure trading stock at the moment, with an unsustainable rise on the chart, and the inevitable pullback due to profit taking just starting to get underway (Friday, after all).
Don't forget that the rising price of silver is in USD, and as long as the AUSD is also rising, then the silver price in Aussie dollars is actually going sideways or down.
Same reason why current gold producers like BCD, DOM, and others are not following the price of gold upwards - they are in fact going down bigtime.
Don't get me wrong - I'm a silver bull through and through, and CCU stands out by virtue of the fact that it is almost, if not THE, only silver play on the ASX apart from CXC. Oh yes - and the lead, of course.... ;)
I suspect that CCU will settle back into the mid-20 cent range over the next few days, and perhaps then a slow uptrend as resources become more defined and production starts to look feasible.
Of course, if our dollar goes to parity or beyond, as some are suggesting, then this will still work against CCU and all the other gold and commoditiy producers who hvae to repatriate the money back into Aussie dollars.
I'm now out of CCU, and very happy with the trade I did :)
CCU Price at posting:
38.7¢ Sentiment: None Disclosure: Not Held
