Iron ore prices have defied the numerous bears over the last few years, rallying in the face of adversity, with the bulk commodity testing fresh 2-year highs earlier this month. Yesterday, the AFR was reporting that Citi is now tipping iron ore to hit $US150, or 10% higher, following China’s recent fresh bouts of stimulus – a bit late, but we think they are probably correct, although the risk/reward was far better 6-months ago. Like much of the market, FMG appears to be in a classic “be long or out” situation which is overall encouraging for the ASX.
- We are still looking for FMG to test the $30-32 area in the coming months, but the risk/reward isn’t exciting at current levels
MM is cautiously bullish towards FMG short term
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