NCM Under Pressure After Cadia Dam Failure

Posted on | by Todd | Leave a Comment on NCM Under Pressure After Cadia Dam Failure

Shares of NCM have dropped over 5% in early trade reaching an 8-month low of $20.30.

The selling pressure is in response to the weekend news that the Cadia mine west of Sydney has been closed due to a failure of an embankment at a tailings storage area.

Initial investigations suggest the break in the wall is related to 2 local tremors, of 2.7 magnitude, which struck the region on Friday.

 NCM officials have released a statement today saying that no tailings will reach the local environment, but that 2018 production guidance could be impacted.

Based on the information disclosed so far, we don’t expect a protracted production halt at Cadia like after the seismic event in April of last year.

As such, we believe that increased production efficiency at the Lahir mines in PNG combined with an upward trajectory in Spot Gold prices will see NCM shares stabilize above the $20.00 support level.

NCM is part of our ASX Top 50 model portfolio and we believe adding to long positions in the $20.40 area is a reasonable strategy.

Newcrest Mining

 

 

 

ALGO Buy Signal For BHP

Posted on | by Todd | Leave a Comment on ALGO Buy Signal For BHP

Our ALGO engine triggered a buy signal for BHP into the ASX close at $28.35.

The “higher low” price structure is referenced to the $26.90 low posted on December 8th.

BHP’s share price has dropped 10% over the last 8 trading sessions as concerns about the company’s proposed sale of shale assets has somewhat clouded their future earnings outlook.

During a webcast on Friday, CFO Peter Beaven reminded investors that BHP has a policy of paying out at least 50% of profits in dividends and increased that to 72% in the December half.

With respect to the shale assets, one analyst report suggested that for every $1 billion of proceeds from the sale, BHP can return 24 cents per share.

Technically, we see good price support at the $27.85 level and an area of initial resistance at $30.15.

BHP

 

 

 

 

 

 

 

 

March Quarterly Index Review

Posted on | by Leon Hinde | Leave a Comment on March Quarterly Index Review

It’s always interesting to look at the index re-balancing and think about the names that have been removed or added in the index rankings.

QBE has a negative price structure and an Algo Engine sell signal.

S32 has an Algo Engine buy signal and is a core holding in our ASX Top 50 model Portfolio. As of  March 19th, S32 will now move into the ASX Top 20 model.

We suggest readers look at the charts of the two new additions to the ASX100 index, CWY and XRO.