Gofer and The Vet....amazing chart of the London Inventories...
I suspect those in NY and Shanghai aren't fairing any better?
The DMI only says that in the face of falling inventories the price of Copper is a mild downtrend...and that at $1.40 the world will not run out of Copper; there's some coming from somewhere...As mentioned earlier, in the short term I don't much like the looks of Silver, destination at least $6, nor Gold, next port of call $410 or so...Copper??? appears to me down to somewhere...$1.25??... I think the hedge fund bears have the stage until something close to the end of the month...Good dollar rally from here and look out below...
Gofer, metal producing companies will make money at $1.40 copper, owners of the shares in developing properties without revenues might have a more difficult time....and it may be the shares of both types fully reflect current prices. Gold mining shares don't look to come alive until something north of $450 in seen, in my opinion, as increasing costs subtract from revenues and margins fail to improve.. Could the same be true for other base metal miners...?
I find myself with a whole list of shares where there are great expectations but only sideways to downward price action at this time. ..This is a mistake, I believe...given the chance I intend to pair back further...stand a bit further aside from the listless action, watch for a capitulation bottom of some sort or other evidence the trend has changed and there's some upside momentum building...Or until such time as it's official...."the World has run out of Copper....!!" It'll never run out of Silver...or Gold, as long as big NY Bank paper is a substitute. |
