Global Mining Investing $69.95, 2 Volume e-Book Set. Buy here.
Author, Andrew Sheldon

Global Mining Investing is a reference eBook to teach investors how to think and act as investors with a underlying theme of managing risk. The book touches on a huge amount of content which heavily relies on knowledge that can only be obtained through experience...The text was engaging, as I knew the valuable outcome was to be a better thinker and investor.

While some books (such as Coulson’s An Insider’s Guide to the Mining Sector) focus on one particular commodity this book (Global Mining Investing) attempts (and does well) to cover all types of mining and commodities.

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Tuesday, February 19, 2008

Healthscope (HSP.ASX)

Healthscope over the last 8 years have been a spectacular performer. I do however question whether they can continue this performance. The conventional wisdom is that everyone needs healthcare, even in recessions, and no one cares about costs when it comes to costs, but I want to offer a number of counter-arguments.
1. No one wants to be a nurse in a hospital, so its hard to find staff, and still harder to pay enough to keep them, particularly where there is higher wages overseas.
2. All costs are rising
3. Service outsourcing is becoming more common. We will see more patients going overseas for treatment.
4. Health remains a highly regulated area, and I think people are more likely to cut back on private insurance. Its true successive governments have shown their support by propping up the private system. But given the quality of public health, and the choice of overseas treatment, I suspect healthcare will seem less alluring than indicated.
I thus will be looking to see whether this stock will break the $5.00 support, or whether it continues its uptrend. More information at Google Finance and see my discussion forum.
Andrew Sheldon

Qantas (QAN.ASX) - what goes up must come down

Qantas has pulled back alot from $6.00 to $4.50, and people might be thinking this poses a great entry. I am however discouraged by several factors. The stock was pushed up by a failed leveraged takeover, the support has really not sufficiently tested the $4.20 support level, and whilst I suspect it will consolidate at that level, I dont see it holding it. I think the airline will struggle to fill seats in a contracting economy, and I think discount airlines will make a bigger impact, and regional airports will grab more market share. I think alot of cities are pricing themselves out of the tourist market and business travel will likewise contract. For this reason I can see them falling back to $3.00. More informationn at Google Finance, and see my discussion forum.
Andrew Sheldon

Monday, February 18, 2008

IAG Australia Group (IAG.ASX)

There was a good opportunity to trade IAG stock last week which I missed, though the stock is technically still in a downtrend, so there might be an opportunity to buy back in at $3.50. We can see in the charts to the left that $3.50 is an important technical support. I actually dont see alot of upside in this stock, instead I think we are likely to see consolidation. The first chart is weekly, the 2nd a weekly chart. For further information on IAG see Google Finance and my discussion forum.

Westpac Banking Corp (WBC.ASX)

Westpac is one of Australia's largest banks, and I would suggest one of the better bank investments because of their move into resource investment banking in recent years. I do however not think now is the time to buy because of the outlook for higher interest rates and inflation. I also expect they will follow the ANZ by reporting increased bad debt provsions. I therefore think they will break the $21.70 support level, and can see them falling back to the $20 support level. This level is far stronger.
For more information on Westpac look at Google Finance and see my discussion forum.

Sunday, February 17, 2008

BHP, RIO looking good, steel companies facing higher costs

Coincidentally, after suggesting selling steel companies Bluescope and OneSteel, I see a report out today that "Japanese agree to 65% Iron Ore Price Gain". Thats a big increase. I dont follow iron ore prices so closely, but I suggest this merely reflects the Japanese & Chinese conceding that they have to accept the annual price setting negotiation system that has been in place for decades. Until now they have avoided the system, resulting in an increasing amount of iron ore being sold into the spot market. Acceptance of the system seems to acknowledge the risks of not helping to finance new projects, as well as the risk of not securing the product they require.
Anyway, higher iron ore and coal prices is good for Rio Tinto and its takeover suitor BHP-Billiton. Both are huge producers of iron ore, though I prefer BHP at the time for its greater coking coal exposure, but there will come a time when thermal coal (Rio Tinto) makes more sense. The takeover might reflect that.
The flipside is that this news confirms my recommendation to sell off the steel companies because they will confront higher raw material costs.
Andrew Sheldon

Futuris Corporation (FCL.ASX)

Futuris Corp is looking good with its exposure to the Australian agricultural commodity/rural sector. Futuris holds a stake in Elders Finance & stock agency, as well as fertiliser to my 'limited' knowledge. Given the outlook for commodities, this is a great stock to hold. In fact now is a perfect entry given that the stock has fallen back to a solid support at $2.00. I have no hesitation recommending this stock. Join my Google Finance FCL Forum!
Andrew Sheldon

Mincor Resources (MCR.ASX) at technical lows

Mincor Resources has reached a technical buy point judging from the following chart. The fundamentals are looking good as well since nickel prices have consolidated and stockpiles have stabilised. Might the next move in stockpiles be down? I think so. See my latest post on nickel prices and stocks at
The support level for Mincor Res is $2.70, and the stock is currently trading at $2.92. Based on the positive outlook for nickel, I do believe this stock is about to rally. It fell off its high very quickly, and I suggest it will provide traders with a good rally.
Join my Google Finance MCR Forum!
Andrew Sheldon

OneSteel Ltd (OST.ASX)

Onesteel like Bluescope looks like another candidate for short-selling, only more so if the attached chart is anything to go by. This will be the 3rd attempt by this stock to break the $7.30 level. In fact the hang-man candlestick is already giving us a sign of weakness. Great for a short sell!
If you want to join my discussion on this stock, go to Google Finance.
Andrew Sheldon

Bluescope Steel (BSL.ASX)

Bluescope has provided a good rally since Xmas. I would suggest however its time to take profits as its margins will be squeezed by higher costs and weaker demand. A stronger AUD will also not help. I think this stock will resume its downtrend. There is upside to $11.50, but I dont think I would be waiting to sell until then, unless you are short selling. I would be playing a sell order now. Join my forum at Google Finance.
Andrew Sheldon

Brambles (BXB.ASX)

Looking for a trade in Brambles? The stock I suggest is going to fall back to previous support at $9.50. There is scope for a rally up to $10.75. I dont know much about this stock anymore since I recall talk of selling their pellets business, so this is purely a trade note. One should be mindful of a stronger AUD if they still have overseas investments. If they are sitting on cash, I suspect they will consolidate until the market knows where it is going.
If anyone can suggest more, I have set up a discussion forum at Google Finance.
Andrew Sheldon

Sunday, February 03, 2008

Gunns Ltd (GNS.ASX)

Gunns is Australia's leading timber company. The company has lost alot of its gloss as timber prices have come off, but that appears destined to change if the indicated timber prices are any gauge. If we look at the leading lumber futures contract prices, they are close to a low, providing a great cyclical re-entry into the sector. See the lumber price chart in my Commodities Trading Blog.
As for Gunns, we can see that the stock is on a long term uptrend, but is currently undergoing short term selling, so that will provide a better opportunity to enter this stock around $2.80-2.90. Participate in a Google Finance forum on Gunns Ltd.

Andrew Sheldon


On the topic of food, CSR strikes me as close to a buy. The stock is destined for a technical breakout. Sugar prices are trading - are just commencing a rally after a significant pullback. Apart from a food additive, sugar is increasingly being used for ethanol production. Australia is not the lowest cost producer, all the more reason why CSR should rally hard, because its tight margins from sugar milling should benefit from higher prices. It seems probable that CSR will find support above $3.00, but there is downside to $2.80 given the current financial strife. Without doing more research I wouldn't be surprised to see them fall to $2.50, another stronger support.

There is reason for caution however based on the following report - see
Wondering if there is any unfavourable hedging in there as the CFO has resigned. One of the chief reasons for the fall in earnings was the drop in sugar prices and strong AUD. Sugar prices will rise again, but its unfortunate that building products - the other core division i s set to be a future drag on earnings. Having said that, with the current property boom over in Australia, people are likely to invest in home improvements. Anyway check out the latest thoughts and contributions from readers at
Andrew Sheldon

Australian Agricultural Company (AAC)

This is actually Australia's largest company, and its not the first time I have recommended this stock. Here is an updated chart after first recommending it on the 26th Sept 2007. In the wake of the sub-prime crisis, its held up very well like all commodities. What I like about this stock is:
1. Its a food commodity producer - beef - thats agricultural commodities, which are set to perform very well over the next 5-7 years. You have seen asset inflation, now watch as cost of living expenses like food go up whilst other 'asset' costs come down. Regardless of whether the Fed and other central banks attempt to keep asset prices high by further debasing their currencies, you can do no better than investing in such shares.
2. Recent rains: Farmers have just received some drought-relieving rains

3. Commodity prices are already going up - See
Looking at the chart we can see that AAC has consolidated above support at $3.00, but any buying above around this level is likely to pay off very handsomely. This is a good super fund stock. Buy heaps of them - why? They have 13 properties spread across NT-Qld-NSW, alot of them in areas where ABARE tells us that Australia has actually received higher amounts of rain than the rest. I drove from Darwin to Sydney (see trip) last Oct, and it was greener than Bathurst.
Looking at the map for "Rainfall comparisons for Australia - This year minus last year - 9 months" at and playing with the parameters, its evident that farm prices are going up at a time when drought relief is well underway. The map suggests that the AAC areas of Qld are getting 300-600mm of extra rainfall compared to the drought period - whether you look 1,2 or 3 years ago.

Strategically very valuable land holdings! Robert Holmes a Court's son runs this company from memory. I think you will be looking at $10/share within 5 years, if not sooner, as currencies continue to be debased by another cycle of interest rate cuts, and as food price rises correct the product-money supply imbalance.

The reality is that alot of farmers are not aware of the surge in food prices they are just about to experience. If you are single I would be out drinking this weekend in Inverell or Dubbo trying to pick up a 'sheila'. Armidale is my preference for a educated girl. Or if the pickings are slim, or they are a bit full of themselves, the girls in the Philippines have a far greater sense of reality. Most of their boyfriends are alcoholics, gamblers, so you'll make a great impression. The Philippines is another food producer, albeit mostly for domestic consumption. Anyone want to go farming in the Philippines. Land is the most under-utilised commodity in this country, and with high rates on unemployment, and its English speaking. Cant think of a better place to build a farm? You might also recall my positive sentiments for the NZ currency about 8mths ago, well it relates to the current outlook for food commodity prices. So if you are desperate go to NZ by all means! Just make sure you're a alco before you get there to impair your judgement. The sheep will love you more than the locals.
Hmmm...makes we want to investigate more NZ food producers. Why? Currency advantage and greater stock selection in food I suspect. Anyone want to farm in the Philippines. I'm keen to grow mitake mushrooms, soybeans and avocados.
Andrew Sheldon

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