ASX

Posted on | by Leon Hinde

ASX is one alternative for investors looking for a replacement for bank stocks within their portfolios. ASX offers 3.5% yield, (fully franked) and when combined with a covered call option, the cash flow is boosted to 10% p/a.

Our Algo Engine flagged a recent buy signal on the high low formation at $58.

ASX is also a current holding in the ASX100 model portfolio, up 38% since being added back in September 2016.

 

Local Oil Names Rebound In Front Of OPEC Meeting

Posted on | by Todd

The price of West Texas Intermediate (WTI) Crude oil surged to a 4-year high of $76.90 just over a month ago.

Since then WTI prices have plummeted almost 30% and reached a low of $54.70 this week.

It’s clear that the market overestimated the impact of Iranian sanctions, increases in Non-OPEC production and the forecasts for lower oil demand in 2019 from the EIA.

Aside from the technically oversold conditions, the OPEC producers have hinted that they will take measures to shore up crude oil prices when they meet in Vienna on December 6th.

After trading to 18-months lows earlier this week, both WPL and OSH are now under ALGO buy signals.

We consider a price reversion to higher levels a likely outcome with initial resistance for WPL at $35.05 and OSH at $8.15.

Woodside Petroleum

Oil Search

Ramsay Firms After AGM

Posted on | by Todd

Shares of RHC have been edging higher as investors respond favorably to their recent AGM on Tuesday.

With respect to their Capio AB acquisition, management continues to target overall positive core growth of up to 2% in FY 2019.

With the share price at  22X present earnings, we would have liked to seen a higher rate of expected core growth to sustain a rally from current levels.

RHC remains under an ALGO sell signal but we expect the $51.00 level to show solid support and an ALGO buy signal in the medium-term.

Ramsay Health

 

 

 

 

Crown Resorts Is Oversold

Posted on | by Leon Hinde

Crown Resorts is a current holding within our ASX100 model portfolio.

Following the recent sell-off on the back of global concerns about slower VIP growth, the stock has retraced from $14.50 to $11.75, which forms a “double bottom” pattern dating back to October 2017.

At $11.75 we believe Crown offers value and investors should look to accumulate the stock for a move higher.

 

 

Buy Medibank & Sell Call Options

Posted on | by Leon Hinde

Our Algo Engine shows Medibank remains under “buy conditions”.

With yesterday’s update at their AGM showing that the improved momentum in 2H18 had continued into 1Q19, we recommend accumulating the stock.

Buy Medibank and sell out of the money call options to enhance the income.

Medibank

 

 

Medibank Firms In Front Of Today’s AGM

Posted on | by Todd

Shares of MPL have rebounded smartly since posting a two-year low of $2.62 on October 26th.

The company is holding its AGM today and we expect a favorable reaction from investors.

As announced in their FY18 results, MPL expects growth in operating profits around 25% for FY19 combined cutting $60 million of management costs over the next three years.

On balance, we see MPL as well positioned in the healthcare sector with an upside target just over $3.10

Medibank

 

 

ALGO Sell Signal For QANTAS

Posted on | by Todd

Our ALGO engine triggered a sell signal for QANTAS into yesterday’s ASX close at $5.90.

This “lower high”pattern is reference to the intraday high of $6.30 from September 12th.

On October 25th, we posted a report to buy QAN in the $5.40 area on the basis of lower oil costs and steady earnings growth.

At this point, it looks like oil prices are overdue for a rebound higher, which could pressure QAN back into our $5.40 to $5.35 buy zone.

As such, we suggest taking profits in QAN.  At current levels the return will be just over 8%.

We will look for another ALGO buy signal in the $5.30 area.

QANTAS

 

XJO – The 5941 Level Is Technical Resistance

Posted on | by Leon Hinde

The XJO has formed a “lower high” pattern within the existing Algo Engine buy signal structure.

The market has rallied 6% from the recent buy signal but we’re now mindful of the recent break of the “higher low” structure, as circled on the chart below.

5941 is resistance for the XJO and whilst the market remains below this level, some caution is required.

Names that remain supported within today’s broad market sell off include, AGL, CTX, GPT, WES, SCG, TCL, HSO & WOW. We remain cautious on the banks and select resource names .

XJO