Fortescue breaks support

Here’s the chart:

I don’t think I have ever seen a more perfect bearish descending triangle pattern. It’ll need to close here or lower to confirm the break. The target price is anybody’s guess but new lows are quite possible.

Weighing today is the 58% iron ore is at $37.44. I reckon it’s headed deep into the $20s this year. Also, CLSA cut its target price to a far too high $4.70.

Where goes FMG goes Straya.

Comments

  1. Yes, FMG is toast, but it’s *almost* as though, relative to the other IO players, the price has – comparatively – discounted a bleak outlook at these share prices; this is not to suggest it won’t tumble further.

    For me, given relative share prices, I would sooner rather short BHP = much more down-side.
    Have a look at the long-term Copper chart @ http://www.kitcometals.com/charts/copper_historical_large.html#1year = a really frightening drop ahead.

    SHORT BHP …. [ and FMG ]

    • The real story is the price premium… no where remotely sustainable IMHO. Therefore who will lose out most in revenues when it starts moving back to normal ranges, even if prices fall generally??? BHP, Vale and Rio… and other unmentionables.

  2. thomickersMEMBER

    Is the discount for 58%FE more than 40% compared to 62% FE?
    I have 58% FE spot at roughly 35% discount ($41.50/tonne).