The Aussie market may not have managed to make a V bottom after yesterday's weakness but European and North American indices certainly have. US was strong again last night on a good start to the earnings season. Here's a daily chart of the Dow.
Anyway, I got sucked in to selling out of Ipl and Mmx yesterday which was a mistake because they've bounced back pretty well already - it's 10.22 am. Also, my plan in Fmg was just a little bit too cunning; they finished at 426 yesterday which is just about in my buy zone, but they've shot up to 439. Nevertheless, I'm still long Lynas and Western Areas which are both up nicely.
The reason for the early post is that there may finally be something happening in Linc Energy. I've had these in my super fund for a year or two and have taken some pretty heavy losses but, stubbornly, held on. They're a coal seam gas junior and have a lot of coal leases. Their process specialises in transforming previously "stranded" coal into liquid fuel so they are able to sell the standard coal mining portions of their leases - at least, I think that's how it works! Early on in the GFC they were all set to sell some of their coal fields to the Chinese for $1.5 bn but the buyers went missing as economies were trashed. They're still trying to sell them and last night there was news of an Indian buyer about to pay $1 bn. The first I've heard of it was a company announcement just before the start of trading saying that nothing has been concluded and they remain in talks with a number of parties. Anyway, the market cap is under $600 m so there's plenty of upside and the chart has a nice bottoming pattern with mildly higher lows and the chance to move into an acceleration mode. I bought some on the open at 113, cautiously, because there have been so many false starts in this stock. I've added more now, with the average entry price up to 116.
Thinking about Linc, they're kind of like a property developer whose developments haven't quite got off the ground, but with a huge landbank which is suddenly very valuable. I'm quite interested in the whole clean energy thing, so I hope that they can sell this mine and use the cash to ramp up their production from a test system to full scale.
12.26 Linc went really well this morning, a spike as high as 141.5, and now a consolidation around 132.
2.45 Back from lunch and a few errands to find that Lnc is softer at 130.5 but holding ok. I sold a handful at 136 before leaving the office.
Ipl is strong today but Mmx, like most iron ore stocks, is still hesitant so the opportunity cost hasn't been too painful today. In the steel sector, Bsl is firmer but Ost is only up a touch. I've taken the opportunity to buy that at 291. The year's low was made 6 bars ago and I'm looking for a least a 3 wave rally so 275 is the stop and maybe it can run up to 325, 330.
4.18 A high close for the index, up 1.9%.
Out of a few more Lnc at 138 and some Wsa at 416. Sold the Lyc earlier at 67.5 but they closed at 69.5.
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