Algo Buy Signal – Woodside Petroleum

The sell-off in oil back to US$45 per barrel has seen WPL, OSH, STO, and ORG all come under selling pressure.

Origin remains one of our preferred exposures among the energy names and after taking profit recently at $8.00, we’ve been buyers again on last weeks pullback to $7.30.

We now add WPL to our buy-list; we believe it’s back within a price range where buying interest is likely to start picking up.

The Algo Engine triggered a buy signal on Friday in WPL, at or near $30.00

Chart – WPLChart

 

 

 

Ansell – Buy Now

Our Algo Engine triggered a buy signal in Ansell on the 7th February at $21.50 and the stock is now trading $23.22.

The recent selling weakness, where price has retraced from $25 back to $23, provides another buy side entry opportunity. The company will commence a $400m share buyback program later this month which should help to underpin the share price.

Stop-loss orders should be applied on a break back below $22.50. Buy and hold investors seeking added yield, may prefer to take a slightly longer-term view and sell-out-of-the-money calls at $25 into November.

Chart – ANN

ETF Update: Buy YANK Into The US FOMC Meeting

At the FOMC meeting this Thursday, the US Federal Reserve is widely expected to raise the Fed Funds target by 25 basis points to 1.25%.

This would be the third increase in the FED’s target band since November and further underscore the fact that the FED is the only G-10 central bank which has an upward interest rate trajectory.

With the RBA maintaining overnight rates at 1.50%, the spread between US and Australian benchmark rates will narrow to a 11-year low of just 25 basis points.

This further narrowing of the carry premium between the AUD and USD will likely put more downward pressure on the AUD/USD.

Investors looking to profit from a lower AUD/USD can buy the BetaShare ETF with the symbol: YANK.

YANK is an inverse ETF, which means the price of YANK increases as the AUD/USD trades lower. It also has a weighting of 2.5%, which means the unit price will fluctuate  by 2.5% for every 1% change in the AUD/USD exchange rate.

With a current price of $14.70, we calculate that the price of YANK will be near $16.50 as the AUD/USD returns to the January low of .7160.

 

BetaShare ETF: YANK