Stick to TAM - buy on pullbucks
The correction last winter-spring later was re-corrected until now, but there has been a few China-related short pullbacks during the movement up. My guess is that it is not the right season now for bigger corrections in base metals.
Also fundamentals agree, since the last big correction started some 9-10 moths ago the Chinese GNP must have grown around 5-7 %. As my posted Tamerlane stock analysis two days ago discussed, this should long term correspond to an underlying Chinese increased demand of base metals of some 10-14 % or so even if seasonal factors may change that figure but annually the increase is a reality. And since China is a big part of the world economy (2nd biggest GNP) now and gets bigger all the time this ever increasing demand has to push prices upwards during an otherwise rather steady or slow growing world economy exkluding China. India is already in this state of fast growing but more important WILL enter the period alså a fast growing demand for base metals oil, etc. Then there will be two hungry wolves for some years :-)
TAM is still severely undervalued relative to Zn&Pb prices and IMO should be bought on any pullback and hold, IF you are a world economy fairly optimist, i.e. you fear no double dip next year. The management has with the new bridge financing shown that they are serious this time and will dilute as little as possible, thus confirming the company presentation agenda.
TAM should rather be valued and traded at 0.5-0.6 now IMO, if Mr Market had looked this way and understood what he saw. With the huge metal price leverage TAM has a potential to rally to CAD 1.5-2 next year if Zn&Pb reach, let say USD/lb 1.3-1.4 which I think is quite possible, and still be conservatively valued with some potential left.
Remember, in a year from now the Chinese base metal demand may have grown another 15 %. How will that affect oil and base metals ?Time will tell...