Rio Tinto Expands Mining Farm

Rio Tinto Expands Mining Farm

Rio Tinto has formally opened its new $US338 million Silvergrass iron ore mine in Western Australia’s Pilbara region. The 10 million tonne per annual operation is the company’s 16th mine and represents the first new iron ore mine in Australia since the opening of Gina Rinehart’s Roy Hill mine.

Rio Tinto chief executive Jean-Sebastien Jacques said the output from Silvergrass would be crucial to maintaining the company’s Pilbara blend product. “Silvergrass is a great example of our value-over-volume approach in action as the mine will deliver the high-quality, low-cost ore used to maintain the world-class premium Pilbara blend product our customers love so much,” Mr Jacques said. The project, which created around 500 jobs during its construction, will link in with Rio’s existing Nammuldi operation via a nine-kilometre conveyor system.

Technical Analysis

stocks

Overall, the bias in prices is: Upwards.

Short term: Prices are moving.

Intermediate term: Prices are trending.

Note: this chart shows extraordinary price action to the upside.

By the way, prices are vulnerable to a correction towards 64.57.

The projected upper bound is: 71.06.

The projected lower bound is: 65.88.

The projected closing price is: 68.47.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 8 white candles and 2 black candles for a net of 6 white candles. During the past 50 bars, there have been 32 white candles and 17 black candles for a net of 15 white candles.

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 81.0886. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 3 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 66.07. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 72 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 116.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 4 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 6 period(s) ago.

Rex Takasugi – TD Profile

RIO TINTO FPO closed up 0.440 at 68.280. Volume was 17% below average (neutral) and Bollinger Bands were 13% wider than normal.

Open      High       Low        Close      Volume
68.200   68.450   67.700   68.280   1,849,825

Technical Outlook
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period    50-period    200-period
Close:                       66.41            64.67            62.40
Volatility:                21                  26                  32
Volume:                   1,883,976   2,058,390    2,351,783

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

RIO TINTO FPO is currently 9.4% above its 200-period moving average and is in an upward trend. Volatility is low as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of RIO.AX at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on RIO.AX and have had this outlook for the last 4 periods.

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Ivy Heffernan

Ivy Heffernan, student of Economics at Buckingham University. Junior Analyst at HeffX and experienced marketing director.

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