Post by
Sevster on Dec 06, 2005 3:52pm
Natural resource bubbles in a stock market
Happen every year. End of 2004 created a huge oil bubble. This is driven by a large-scale investor interest in a certain commodity. You could see oil bubble somewhat tanking nowadays, only leaving real winners like CLL and UTS, and driving even optimistic companies like MIG and QEC downwards.
The recent uptrend in Moly prices made me choose UNB as the next company to invest in. I could see Moly bubble forming in the future, but that did not happen yet. I would look closely at AUA for signs of the forming Moly bubble. Also, keep in mind, there is not as much competition as with oil, so the bubble will expand at a much rapid pace.
You could take recent UNB growth as a positive in an environment where other Moly stocks have not moved up yet. If AUA starts to move, that will resonate the interest in Moly across the exchange, and UNB will have additional afterburners as a bonus.
I have a feeling, if Moly prices hold, and they most likely will, we could see the onset of the Moly bubble in the spring of 2006. Around that time, possibly, it would be a good time to flip your UNB shares for AUA - maximizing your profit.
Comment by
Sevster on Dec 06, 2005 6:34pm
UNB for AUA flip at the right time is a pure Moly play. UNB shows a lot of promise, and am almost convinced this stock is 3 or 4 banger from here to the summer. I would have to reassess in the Spring when financials showing the profit from production are released.
AUA is on my watch list too - as a possible 5 banger given Moly price holds - but it will not move till Spring or Summer of 2006.