Chart of the Week

Emerging Markets are inversely correlated to the $US, we see 2 scenarios unfolding moving forward which have a strong read-through for our miners:

1. We have already seen a major low in October and the next 15% move is on the upside – bullish for Australian resource stocks.
2. We will see one final dip towards the 800 level on increased recession fears providing an excellent entry to the local Resources Sector.

The conclusion is we are bullish towards the local Resources Sector but we need some flexibility if we see one final dip over the coming months.