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Anna Coulling

Anna Coulling
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  • Silver Prices Are About to Fall [View article]
    whilst i accept that silver prices are finding it hard work trying to overcome the $18.00 resistance the medium to longer term for the metal still looks very positive.,
    Nov 6 08:23 AM | 4 Likes Like |Link to Comment
  • What You Need to Know About Commodity Markets, Gold and Oil [View article]
    A very interesting article and I would only add that China is now also using its vast dollar reserves to take advantage of low commodity prices to buy a whole range of industrial commodities including aluminium, zinc, nickel, and rarer metals such as titanium, indium (used in thin-film technology), rhodium (catalytic converters) and praseodymium (glass). Of deeper significance are recent comments by China's central bank governor Zhou Xiaochuan, about the possibility a new world reserve currency which could be modelled on the "Bancor" first suggested by John Maynard Keynes at Bretton Woods in 1944. Keynes argued that the advantage of the Bancor was that it could be pegged to 30 commodities, not just gold. Zhou Xiaochuan has said that such a currency could prevent the sort of "credit-based" excess which has brought the global finance system to its knees.



    Apr 16 09:26 AM | 4 Likes Like |Link to Comment
  • Why the Price of Gold Is Not Yet Soaring [View article]
    When the world's largest gold-backed exchange-traded fund, the SPDR Gold Trust, confirms that its holdings rose to a record 1,124.99 tonnes on March 24, up 10.7 tonnes from the day before it merely confirms just wary we must be of recent stock market rallies. The gold price also spiked up today on remarks by Treasury Secretary Geithner who said that he was "quite open" to China's suggestion of moving towards a currency system linked to the International Monetary Fund's Strategic Drawing Rights (SDRs).
    Mar 25 03:47 PM | Likes Like |Link to Comment
  • Oil Is Years Away from a Meaningful Recovery [View article]
    No discussion about the oil price or oil market can ever discount the geo political issues surrounding this commodity. Regardless of the minimum price required to make investment in the development of new fields viable, for example the Alberta Sands project needs the oil price to be at least $60 a barrel, producer countries still need a minimum price to fund their respective regimes to avoid social and political unrest. OPEC production cuts since September have only resulted in a compliance rate of 80% compliance with Nigeria and Venezuela missing their respective targets by some margin. It has been calculated that Venezuela needs oil to be at least $97 dollars while Russia needs the oil price to be at least $70. Higher oil prices may be the price we have to pay for a modicum of stability or at least until we can develop sustainable, alternative sources of energy.
    Mar 25 03:22 PM | 2 Likes Like |Link to Comment
  • Oil Responds to OPEC Supply Cuts [View article]
    Today's show of strength to above the $50 level for oil had much more to do with a weak UK dollar than to a significant shift in basic supply/demand fundamentals. A purely fundamental approach would have emphasized yesterday's EIA report and could easily have made a strong case for a lower trade today and a further sell off into tomorrow's expiration of the April WTI futures contract. Personally I would caution against underestimating the power of a dramatic weakening of the dollar while the chart is giving strong bullish signals. I would also add into this mix a COT index extreme reading for the commercials. This combination of currency and technical factors can easily push seemingly weak fundamentals into the background and in the process push prices higher than expected. For this week's oil rally to reverse we would need to see the recent rally in equity markets to reverse accompanied by a strengthening of the US dollar which could force some long liquidation out of oil.
    Mar 19 04:42 PM | 1 Like Like |Link to Comment
  • Oil's Bottom Line [View article]
    Today's show of strength to above the $50 level for oil had much more to do with a weak UK dollar than to a significant shift in basic supply/demand fundamentals. A purely fundamental approach would have emphasized yesterday's EIA report and could easily have made a strong case for a lower trade today and a further sell off into tomorrow's expiration of the April WTI futures contract. Personally I would caution against underestimating the power of a dramatic weakening of the dollar while the chart is giving strong bullish signals. I would also add into this mix a COT index extreme reading for the commercials. This combination of currency and technical factors can easily push seemingly weak fundamentals into the background and in the process push prices higher than expected. For this week's oil rally to reverse we would need to see the recent rally in equity markets to reverse accompanied by a strengthening of the US dollar which could force some long liquidation out of oil.
    Mar 19 04:41 PM | 1 Like Like |Link to Comment
  • I Think Oil Will Outperform Gold in Near Term [View article]
    Whilst it is important to understand how and why various financial instruments and markets fall in and out of correlation a longer term view on the relationship between oil and gold makes for some interesting reading. From the mid 1960’s and for approximately a 30 year period the correlation between gold prices and oil prices averaged around +0.88 - ie prices moved in the same direction and any figure between 0.80 and 1.00 is generally considered to be a meaningful relationship. From this period until the new millennium of 2000, there was no correlation whatsoever and in fact the average was negative at around -0.15. Since 2000, the correlation has returned to a positive one, but not so strongly with an average of around +0.70, which in my view is weak, and certainly not one I would rely on for long term trading. Indeed in the last few months we have seen daily oil prices falling dramatically with no equivalent percentage fall in the price of gold.

    So were gold prices driven by those of oil in this period, or were they simply driven up by other forces. My own view, for what it is worth, is that changes in the oil price are neither here nor there as far as the price of gold bullion or coins are concerned. Under the current monetary system the directions of the long-term price trends in oil and gold will tend to be the same because inflation is a primary driver of both markets, but it is what’s happening on the monetary front, not what’s happening with oil supply and demand, that matters to the gold market. Investors and traders who simply rely on the gold to oil relationship as their only research would be well advised to base their decisions on other factors, of which there are several. The first of these is inflation, and when inflationary pressures start to enter the market, gold is often seen as a wealth preserver during such times. Secondly I would look at the relationship of gold to the S & P 500, and also at the 10 year T bills - several studies having shown a strong correlation here. I would look at gold to silver and gold to the US dollar. Finally I would always look to see what the commercials are up to in the Futures market and i have recently developed my COT index at www.cot-report.com which is a free resource for all traders and investors.


    Mar 18 01:02 PM | Likes Like |Link to Comment
  • Switzerland Threatens to Start a Currency War [View article]
    Switzerland was probably the last country anyone expected to openly manipulate its currency, that privilege had belonged to China although the last time a G10 country tried the same was Japan in 2003 and it failed as the currency rose 6% the following year. Whilst it is easy to see why the Swiss have taken this action - the Swiss economy is set to fall by as much as 3% this year and Swiss products were simply becoming uncompetitive especially against the Euro, I believe it is now open season in the forex market - who will be next?
    Mar 18 12:45 PM | Likes Like |Link to Comment
  • Jim Rogers Has Gold Coins in His Pockets [View article]
    I do so enjoy listening to Jim Rogers - despite all the dreadful news he always has such a twinkle in his eye. Gold is now at that saturation point in the media when all good traders and investors should be wary and not be panicked into entering this market through fear. Holding gold as a hedge, insurance or protection against geo political shocks is fine but we should not be blinded by its dazzle.
    Mar 18 12:26 PM | 2 Likes Like |Link to Comment
  • The 15 Most Cash Rich Companies [View article]
    Finding a cash rich company in which to invest is an important first step but trying to establish where the cash is coming from and where it is going is even more important. I was given these tips by some specialist insolvency accountants (and they should know!).

    It seems we all need to understand a balance sheet these days and short of becoming forensic accountants at the very least we should try to find answers to the following three questions. Number 1 - Where is the cashing coming from? Companies can boost short term cash flow by borrowing or selling assets. However, there are only so many assets that can be sold and without a regular inflow on cash a company will soon run into trouble. The number to look for is “cash flow from operating activities” – this shows how much cash is generated from the company’s core business activity. A negative number is a red flag and always check back a few years to see if there is any pattern. Highly volatile operating cash flows can suggest trouble – Enron was a classic case in point before it failed.

    A firm can also enhance operating cash flows by delaying payments to suppliers just before the financial year end so always take a look at the note that supports the cash flow figure (usually placed a few pages back) and look for the number showing “change in creditors”. If this number has jumped without a corresponding rise in activity – “cost of sales” – in the profit and loss account, be suspicious. It is also worth comparing the firm’s “operating profit” to its “operating cash flow”. Big variations, or an operating profit not matched by a similar amount of operating cash flow are both warning signs.

    Number 2: Where does all the operating cash flow go? Analysts often quote “free cash flow” which should be positive and ideally consistent with past years, allowing for changes in activity. For example if sales have decreased 10%, free cash flow will probably have fallen as well and should be in proportion. Companies such as Tesco have been able to expand rapidly by using huge free cash flows to buy freehold sites. However, if a company is enjoying high levels of free cash flow and not expanding or paying it back to investors as a dividend, be concerned. Also consider the relationship between free cash flow and the equity dividend. If free cash flow does not cover the dividend at least twice, future payouts could be at risk.

    Number 3: The final area to look at is the “cash flows from financing activities” section. Just as you would not extend your mortgage to pay for day to day living, a typical bankruptcy candidate will raise long term finance as new debt or equity and then use it to keep trading. So compare the total raised as debt or equity in the “cash flows from financing activities” section and the amount being spent on new assets in the “cash flows from investing activities” above it. A big mismatch with no explanation from directors is another warning signs.

    In addition look at a company's “Altman-Z score” This indicates the probability of a company entering bankruptcy within the next 2 years. The higher the Z score, the lower the probability of bankruptcy. An Altman score above 3 indicates that bankruptcy is unlikely; a score below 1.8 indicates that bankruptcy is possible.


    Finally always look at the directors' dealings - are they buying or selling.
    Mar 16 05:13 PM | 3 Likes Like |Link to Comment
  • The 15 Most Cash Rich Companies [View article]
    Cash may indeed be king but a company's debt levels are just as significant. According to insolvency practitioners as investors we should all learn to read a balance sheet. It seems there are three questions we should ask: 1. Where is the cash coming from? Selling assets to boost cash flow is an old account trick - look at the number under "cash flow from operating activities" this is the amount of cash generated from the the company's core activities - a negative number is a big red flag and check back a few years. Highly volatile operating cash flows are highly suspect - think Enron.

    2. Where does all the operating cash flow go? Analysts often quote "free cash flow. If a company is enjoying high levels of free cash flow and not expanding or paying it back to investors as a dividend, be concerned. Also consider the relationship between free cash flow and the equity dividend. If free cash flow does not cover the dividend at least twice, future payouts could be at risk.

    3. The final area to look at is the “cash flows from financing activities” section. Just as you would not extend your mortgage to pay for day to day living, a typical bankruptcy candidate will raise long term finance as new debt or equity and then use it to keep trading. So compare the total raised as debt or equity in the “cash flows from financing activities” section and the amount being spent on new assets in the “cash flows from investing activities” above it. A big mismatch with no explanation from directors is another warning signs.

    Finding the right kind of cash rich companies are around but just take a little time to find. Finally use the "Altman-Z score" which indicates the probability of a company entering bankruptcy within the next 2 years. The higher the Z score the lower the probability of bankruptcy. An Altman score of 3 indicates bankruptcy is unlikely while a score below 1.8 indicates bankruptcy is possible.

    Hope the above helps.
    Mar 16 04:28 PM | 6 Likes Like |Link to Comment
  • OPEC: As Irrelevant as Ever [View article]
    Whatever your views about OPEC, Russia and global demand the price of oil will rise - the only question is when. In my own trading I always look at the COT data and from my own algo and index have noticed that despite the cuts and economic slowdown the index is at an extreme - at an important turning point. I post this data on a weekly basis and is freely available to all. The relevant sites are: www.prices-oil.org and www.cot-report.com and welcome comments from fellow traders and commentators. Thanks.
    Mar 16 03:53 PM | 4 Likes Like |Link to Comment
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