We have had short covering in the past where we get a spike in volume and price at the open and then the stock fades. Today I am seeing spikes of volume and price with very limited drops in volume and price. So far today we have had 3 spikes and the price is ratcheting up, not allowing the shorts to cover at lower prices. At some point, we are going to see an agreement out of Washington and that will be the straw that will break the short's back.
For the record, RIO producing more IO is not a plus for the IO price or for CLF and other miners. It means more supply to market, the same thing the analysts have been screaming from the rooftops for the past year. The interesting thing to note is that IO prices are holding far higher than any analyst forecast even just a few months ago. Which means that their assumptions are wrong somewhere.
I'm a CLF bull, but not for this reason. I think they have a reasonable chance to double consensus estimates this quarter, and with prices holding up in the IO market quite possibly the next as well.