| Author |
Message |
     rederob
Member
Username: rederob
Post Number: 358
Registered: 10-2002Rating: N/A
Votes: 0
|
| | Tuesday, October 05, 2004 - 12:31 am: | 
|
Copper's supposed LME warehouse increase has led to an early selloff tonight.
Singapore & Korea added a net 8,350 tonnes Cu.
Although LME warehouses are back over 100,000 tonnes, slightly over 60,000 tonnes is actually available for delivery - the remainder is spoken for via cancelled warrants.
Hiding behind the data is that traders with spare inventory are delivering into warehouses to take advantage of backwardation (ie get more for selling today than in 3 months time).
This practice exacerbates short supply situations should demand remain strong: It simply means that supplies set aside for "a rainy day" have now been plundered for profit.
God help the trader should that rainy day come soon.
Combined with US GDP being revised upward, China simmering nicely, and European economies doing better than expected, the signs are for copper to run into 2005 at all-time record prices.
|
vermante
Member
Username: vermante
Post Number: 181
Registered: 11-2002Rating: N/A
Votes: 0
|
| | Tuesday, October 05, 2004 - 05:18 pm: |
|
Rederob,
Any views on the SMY trading halt?
Cheers
Vermante
INCREDIBLE OFFER - only $12 USD per month
30 day FREE trial -
Download Here
|
|
|
|
|
rederob
Member
Username: rederob
Post Number: 360
Registered: 10-2002Rating: N/A
Votes: 0
|
| | Tuesday, October 05, 2004 - 08:13 pm: |
|
vermante
Have trolled around and found nothing so far on SMY trading halt.
If it's good news it could be Copernicus results - Voisey Bay style nickel sulphides.
If its bad news my wife won't need to know (until it gets better!!).
|
rederob
Member
Username: rederob
Post Number: 365
Registered: 10-2002Rating: N/A
Votes: 0
|
| | Thursday, October 07, 2004 - 08:18 am: |
|
Base metals and oil put on strong showing overnight - oil breaking through US$52/bbl.
Conventional wisdom tells us that oil and metals are inversely, or offset, correlated. That is, when energy prices rise demand for metals falls away, and vice versa.
You can see the offset relationship in the copper/oil chart below:
Only nickel is bucking the inventory drawdown trend for the moment, so its price increases are propped up by notional demand.
With regard to drawdowns, copper's tight supply stands at 2 week's world consumption: Copper's backwardation increasing nearly 20% overnight to $162.
Mixing metaphors, copper will be drawn from the woodwork into LME warehouses to take advantage of spot prices, but it is very doubtful there will be enough to make a dent in the price charts.
We should see a technical correction on signs of overall market weakness as the metals complex is now heavily overbought (except for tin) - but regard it as a buying opportunity as the tighter the market gets the more exaggerated the each way movements.
And given that we are early days into the annual cycle of high demand for metals, the only way to keep going is up.
Saving the best for last: This week China has taken a back seat to the markets as the country celebrates the 55th anniversary of the founding of the People's Republic of China, which falls on October 1 and finishes on Friday 8th.
So expect next week to be more of the same, and maybe bigger!
|
rederob
Member
Username: rederob
Post Number: 367
Registered: 10-2002Rating: N/A
Votes: 0
|
| | Friday, October 08, 2004 - 12:32 am: |
|
Nickel has had a blinder for the past month, increasing in price a staggering 33%.
Few nickel stocks have matched it (SMY just caught up in last few days only).
Note: please ignore the RSI scale showing 84.7: That is actually the slow stochastic figure(due to a cut and past to fit in the image). RSI is presently 71.1 and the chart is of actual RSI.
Despite the above, nickel tonight was another 3% higher at time of this post.
Oil presently mid 52's and showing no signs of weakness: $55/bbl seems a touch away and $60 by Xmas is being touted by a few brave analysts.
The real question seems to be what price oil will pull back to, when it has its first major retrace - at present rate it's hard to see $40 being challenged near term.
|
ingot54
Member
Username: ingot54
Post Number: 146
Registered: 05-2004Rating: N/A
Votes: 0
|
| | Friday, October 08, 2004 - 10:51 am: |
|
Rederob
Just as an aside - briefly.
I would like to be able to add captions to my charts within the box, such as you have done above. It would broaden the appeal, as one would be able to annotate exactly where intended, without the wordy explanations above/below the chart. Is this a little technical foible, or only available on the software you use. I will have to ask Colin to add this to the "to do" list, if not available on IC already.
Cheers - please resume normal transmission!
Ivan
"That's Life" does not explain anything!!
|
rederob
Member
Username: rederob
Post Number: 368
Registered: 10-2002Rating: N/A
Votes: 0
|
| | Friday, October 08, 2004 - 11:56 am: |
|
Ivan
I use EXCEL mostly so have not mastered the paint program - apparently it's ok for smartypants 8 year olds, but not so easy for the silver foxes.
I cut and paste the above from existing material on very large charts as I did not not want to lose image quality.
Data on nickel is not easy to come by for "free" - most of the commodity sites protect their good info via hefty subscription fees.
I shall borrow judiciously, I hope nobody notices!
In the meantime I shall ask my daughter for some handy hints on PAINT.
|
rederob
Member
Username: rederob
Post Number: 371
Registered: 10-2002Rating: N/A
Votes: 0
|
| | Saturday, October 09, 2004 - 08:22 am: |
|
The outcome of today's federal election has nothing to do with commodities, but is nevertheless seminal from a trading viewpoint.
The indicators - polls - suggest a close result, and have done for the past month.
If there is a landslide the pollsters will revisit their data with wonderment and try to do better next time.
The reality here is that "undecided" numbers have been huge throughout the month of polling, and have always held the key to todays outcome.
The reality on the commodity front was evident overnight when China returned to the ring after a week's holiday - it clearly is key to the commodity long-term bull run - and pushed up an overbought copper complex a further 3%.
My analogy may be a bit obscure: We know "undecided" voters are the key to today's election outcome, as China is to commodities.
But in the mainstream world we tend to rely on "polls" to tell us what the election outcome should be, and on US economic data to guide our world views on markets.
There is always an underlying truth.
So I'm tipping a landslide victory today.
|
greatdane
Member
Username: greatdane
Post Number: 134
Registered: 12-2002Rating: N/A
Votes: 0
|
| | Saturday, October 09, 2004 - 08:33 am: |
|
“There is always an underlying truth.
So I'm tipping a landslide victory today.”
That is a true “each way bet” rederob
Which party will enjoy the predicted ‘landslide victory’??
Enjoy your posts – very informative, balanced and always interesting. Keep it up, please.
Have a great day and use your power X wisely. 
Regards, GreatDane
|
rederob
Member
Username: rederob
Post Number: 372
Registered: 10-2002Rating: N/A
Votes: 0
|
| | Saturday, October 09, 2004 - 08:57 am: |
|
Thanks greatdane
Unfortunately the Communist Party has not withstood the test of time in Australia so being somewhat contrarian I might move from red to green today.
I was about to add that all will be revealed tomorrow - but if it is close a "hung parliament" is in the offing.
Don't you love that phrase, a "hung parliament" - a truly visual feast for the disestablishmentarians!
I won't labor politics on this thread as others have more liberal views.
Vote early and vote often!!!!!!
|
rederob
Member
Username: rederob
Post Number: 373
Registered: 10-2002Rating: N/A
Votes: 0
|
| | Saturday, October 09, 2004 - 10:04 am: |
|
LME metals prices rose strongly overnight with Chinese markets returning after a weeklong absence: 3-month bid prices with difference from Thursday PM kerb close as follows:
Copper $3,142.00 up 100.00
Lead $975.00 up 16.50
Aluminum $1,879.00 up 31.00
Zinc $1,171.00 up 12.50
Nickel $16,950.00 up 662.50
Tin $9,190.00 up 70.00
On the oil front, NYMEX light sweet crude for November delivery closed out the week at US$53.31.
Please note that WTIC (charts of which are regularly posted) is a different "contract" (see http://www.nymex.com/jsp/markets/lsco_otc_wtispe.jsp and http://www.nymex.com/jsp/markets/CL_spec.jsp for definitions).
NYMEX light sweet is the world's most actively traded oil contract, but I can't download the Java charts so use WTIC instead:
With all the commodities into overbought territory there will be a correction soon.
However, we have hit record highs for a number of the complexes and previous resistance will turn into support.
Given that we are early days into the annual production high-cycle, demand for commodities will see downside price dips strongly bought into until Xmas at earliest.
|
rederob
Member
Username: rederob
Post Number: 378
Registered: 10-2002Rating: N/A
Votes: 0
|
| | Tuesday, October 12, 2004 - 01:18 pm: |
|
Overnight basics:
Copper beaten down slightly: Backwardation stretching to a wide $154 cash3's
Nickel liquidated by funds, dropping over 5% and moving from backwardation to contango - today's market almost totally neglected the decline.
Lead falls 1% only and holding onto recent gains quite well.
Aluminium down slightly, but will continue to perform well as backwardation now out $30 cash3's
Zinc belatedly drawn higher on coat tails of others as its fundamentals remain mediocre in a massive bull base metals run.
High oil prices should subdue the metals complexes, yet the theme of ongoing drawdowns will ensure lots of big money will stay in the ring for Al, Cu and Ni, in particular.
|
rederob
Member
Username: rederob
Post Number: 379
Registered: 10-2002Rating: N/A
Votes: 0
|
| | Tuesday, October 12, 2004 - 09:33 pm: |
|
Oil at US$54.23 and on a rising trend as I write.
Precious metals hit by strengthening greenback tonight but not yet "succumbing".
Base metals all down so far tonight, after copper's limit-down sell-off in Shanghai.
There could be more selldowns this week, driven more by high oil and greenback, rather than the physical reality of more drawdowns pressuring demand.
It does seem that large backwardation of copper is prompting more deliveries to LME warehouses - even rumour of another 30,000tonnes in China waiting for the right price.
As noted in earlier posts, draining off these "rainy day" stocks increases price volatility considerably in months ahead as markets will realise there is nothing available to come into the markets from left field.
Unless demand pressures tail-off considerably near term, we are ready for some base metal spikes north that could make oil's rises appear out of gas.
|
rederob
Member
Username: rederob
Post Number: 381
Registered: 10-2002Rating: N/A
Votes: 0
|
| | Wednesday, October 13, 2004 - 08:10 am: | | |
