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Here are the iron ore charts for October 14, 2014:
Meh. Paper markets showed only weak follow through and spot fell. Both of these suggest to me that Monday’s rally was not the beginning of a new up trend but a short covering rally. By my calculations, Dalian 6 month futures are now pricing in the $77 range for January. Hardly enough to warrant yesterday’s hysterical iron ore equity surge. The steel price is more encouraging but let’s see if it can keep climbing.
Some traders were doubtful whether the gains would be sustained as spot cargoes remained plentiful.
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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific's leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
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