Daily Brief Australia: S&P/ASX 200, Canyon Resources, Iron Ore and more

• The S&P/ASX 200 INDEX it’s currently trending up quite well, since October 2023. The current rally picked up some steam from July 2024 and is quite steady. 
• The index started to pull back 2 weeks ago and has closed 2 consecutive weeks down and this week started with a Monday down Close.
• Our models show a clear opportunity to buy this dip and ride the index uptrend back to >3% profit target, roughly a 3-weeks movement according to our forecast.

Canyon Resources, an ASX-listed exploration and development company, is advancing the high-grade, large-scale Minim Martap bauxite project in Cameroon. Minim Martap, a feasibility-stage project, is set to become an important independent source of low-cost bauxite for the fast-growing seaborne market. While we are planning to initiate full coverage of Canyon Resources soon, in this note we focus on the key elements of the company’s investment case – attractive project economics, favourable bauxite market fundamentals and supportive cornerstone shareholder.

• Price Movements: SGX Iron Ore Futures rose $1.95/ton last week, peaking at $107.30/ton but faced increased resistance and waning momentum in the later part of the week. 
• Economic Influence: Expanded Chinese stimulus initially boosted prices, but weak CPI and loan data revealed sustained economic headwinds, dampening a lasting rally.
• Technical Indicators: A flat-top pattern, narrowing MACD, and declining RSI point to bearish potential.