Stretching the boundaries
11.53 am More provocation from North Korea has been enough to break the first line of support at 5700 and take us down to the bottom of the range around 5650 on the ASX 200. I'm pretty happy to see us at least stretch what has been a stifling trading environment even if the market is still in the narrowest range for 25 years.
My two longs in FMG and S32 are actually up while short position BSL has fallen about 2.4%. I've added to the FMG long at 594 as it's clearly well bid and goes ex dividend 25 cents on Friday.
S32 has pushed through yesterday's high .
A few of the gold stocks looked like potential shorts on the close last night and obviously leapt higher on the open. They've nearly all drifted lower though as the market is wary that the gap higher would evaporate on soothing talk from authorities.
In the meantime the banks are still under pressure and that's always a big driver of our market.
1.11 pm I've closed the short in BSL at 1072 as it forms a minor base while the index is doing much the same. FMG is now up 11 at 601 and S32 up at 292, a 4 cent rise on the day.
I bought some IGO early at 353 and the stock is back at 349. It's a way of getting some exposure to gold while not being in a stock that's likely to reverse course on a calming of tensions since most of the focus is on the growing nickel business. It wasn't a great entry but the daily chart has potential. The stock has been in a tight range for 6 trading days just below the top of the range. If it was going to reject the range high, it probably would have happened already especially given the weakness of the market in the last two days.
1.52 pm The Japanese and Hong Kong markets are only down half a percent while Shanghai is flat so I think we have room to rally this afternoon.
2.03 pm Interesting....I thought the golds looked toppy last night but certainly wasn't game to short them today given the missile tests. However, EVN is only up 2 to 241 having opened at 247. It's not evenly spread but about half of the golds I follow have fallen from early highs.
2.33 pm A change of heart in BSL and I reinstated the short at 1067. It just looks terrible on the daily.
4.22 pm There was a late rally though it was pretty insignificant, the ASX 200 finishing down 41 points at 5669.
The golds steadied up and with a certain amount of trepidation, I bought some Resolute on the close for my small dollar book at 113.5. The trepidation is because the stock is by far the cheapest of the mid cap golds and although there are valid reasons for a mild discount because they have some political risk, the discount is severe and the stock can't seem to rally. Today was different. It opened strong and instead of selling off, it managed to keep pushing. Here's the daily.
The stock has 250 million of net cash and a market cap of 836 million so the enterprise value is less than 600 million while the profit announced the other day was 166 million after tax giving a p/e that is under 4 compared to 10-14 for most of the other mids. They're still developing a new mine but a more aggressive dividend or a one off capital return would be smart.
My two longs in FMG and S32 are actually up while short position BSL has fallen about 2.4%. I've added to the FMG long at 594 as it's clearly well bid and goes ex dividend 25 cents on Friday.
S32 has pushed through yesterday's high .
In the meantime the banks are still under pressure and that's always a big driver of our market.
1.11 pm I've closed the short in BSL at 1072 as it forms a minor base while the index is doing much the same. FMG is now up 11 at 601 and S32 up at 292, a 4 cent rise on the day.
I bought some IGO early at 353 and the stock is back at 349. It's a way of getting some exposure to gold while not being in a stock that's likely to reverse course on a calming of tensions since most of the focus is on the growing nickel business. It wasn't a great entry but the daily chart has potential. The stock has been in a tight range for 6 trading days just below the top of the range. If it was going to reject the range high, it probably would have happened already especially given the weakness of the market in the last two days.
1.52 pm The Japanese and Hong Kong markets are only down half a percent while Shanghai is flat so I think we have room to rally this afternoon.
2.03 pm Interesting....I thought the golds looked toppy last night but certainly wasn't game to short them today given the missile tests. However, EVN is only up 2 to 241 having opened at 247. It's not evenly spread but about half of the golds I follow have fallen from early highs.
2.33 pm A change of heart in BSL and I reinstated the short at 1067. It just looks terrible on the daily.
4.22 pm There was a late rally though it was pretty insignificant, the ASX 200 finishing down 41 points at 5669.
The golds steadied up and with a certain amount of trepidation, I bought some Resolute on the close for my small dollar book at 113.5. The trepidation is because the stock is by far the cheapest of the mid cap golds and although there are valid reasons for a mild discount because they have some political risk, the discount is severe and the stock can't seem to rally. Today was different. It opened strong and instead of selling off, it managed to keep pushing. Here's the daily.
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