Newcrest Firms As Spot Gold Continues to Climb

Posted on | by Todd | Leave a Comment on Newcrest Firms As Spot Gold Continues to Climb

As global markets become more concerned about the impact of US tariffs and the escalation of trade disputes, the price of Spot Gold has firmed back to the $1340 level in late NY trade.

Our preferred local gold stock to buy is Newcrest, which has recovered smartly from the $21.20 low last week to reach $22.20 in early trade today.

The correlation between Spot Gold and NCM has been around 70% over the last 6-months.

As such, we would expect a break of the $1350 level in the spot price to correspond to just under $23.00 for NCM.

Newcrest was added to our Top 50 Model portfolio on December 13th at $22.10.

Newcrest Mining

 

WPL Gets A Boost From WTI

Posted on | by Todd | Leave a Comment on WPL Gets A Boost From WTI

Shares of WPL reached a high of $29.25 in early trade as West Texas Intermediate (WTI)  crude oil posted its largest single session gain in over three weeks.

The front month WTI contract rose $1.30, or 2.2%, following a report that crude stocks have dropped by 600,000 barrels at the US storage hub in Cushing, Oklahoma.

WPL is part of our ASX Top 20 Model Portfolio and our ALGO engine triggered a buy signal on February 20th at $29.10.

The stock has been a tepid performer over the last few weeks after announcing a rights issue and going ex-dividend.

However, the technical picture is improving and a break back above the $29.66 level will likely extend into the gap from $30.90 from mid-February.

Woodside Petroleum

 

 

 

 

ALGO Update: Stay Short SUNCORP

Posted on | by Todd | Leave a Comment on ALGO Update: Stay Short SUNCORP

After releasing a less-than-stellar H1 earnings report on February 15th, shares of SUN have rallied close to 7.5% from $12.60 to $13.50.

We believe this relief rally has run its course and the share price will resume its downtrend, which commenced back to July of last year.

The 19% drop in cash earnings was SUN’s most glaring miss in the H1 report, which will act as a headwind for the stock going forward.

Our ALGO engine triggered a sell signal at $14.05 on November 10th.  The initial downside target is $12.60, with a $14.35 stop.

SunCorp

 

 

 

BOQ Is Back Below $12.00

Posted on | by Todd | Leave a Comment on BOQ Is Back Below $12.00

Our ALGO engine triggered a sell signal for BOQ at $12.74 on February 27th.

The technical “lower high” price structure is related to the November 30th high at $13.20 and the November 1st high at $13.40.

We expected the $13.10 resistance level to hold before reverting back below the $12.00 handle.

CFD traders who took this trade can look to cover short positions in the $11.90/95 area.

We maintain our short bias on the banking sector in general, but consider BOQ mildly over-sold.

Bank of Queensland

 

 

Bega Is Looking Better

Posted on | by Todd | Leave a Comment on Bega Is Looking Better

Shares in Bega Cheese Ltd are up .75% at $6.75  after UBS released a positive market note on the company over the weekend. 

BGA had dropped about 8% since the half-year results released  last Wednesday, despite an improvement in all key financial metrics over the previous corresponding period.

However, it seems the market might have been too harsh on the dairy company.  Bega’s first-half normalised EBITDA of $70 million exceeded the $64 million forecast by the street.

We see scope for BGA to reach $7.42 a share and find the stock attractive at the current price, based on 20X earnings.

Our ALGO engine triggered a buy signal in BGA at $6.81 on January 16th. BGA will go ex-dividend tomorrow paying 5.5 cents per share, fully franked.

Bega Cheese