Lockheed Hits All-Time Highs On Saudi Deal

Posted on | by Todd | Leave a Comment on Lockheed Hits All-Time Highs On Saudi Deal

Shares of Lockheed Martin (LMT) reached an all-time high of $280.00 as the defence contractor agreed to a deal with Saudi Arabia worth $28 billion.

This deal alone is enough to cover the company’s revenue for over 6 months

LMT is one of the key beneficiaries of a total arms package which will be worth over $350 billion over the next 10 years.

Among other products, the deal includes the sale of 150 Black Hawk helicopters, systems for air defence, tactical aircraft and combat ships.

Lockheed Martin

Gold Firms, But NCM Still Lags

Posted on | by Todd | Leave a Comment on Gold Firms, But NCM Still Lags

On May 6th, we posted a report on the blog which suggested that both Spot Gold and shares of NCM were in oversold territory.

At that time, the prices were at $1225.00 and $20.10, respectively. Now, Gold is back over $1250 and looking firm on the internal momentum indicators. We expect the yellow metal to test April 17th high on $1290.00 in the medium-term.

In this sense, shares of NCM have lagged behind the spot gold price and have gained just over $1.00 during the same period.

We still consider NCM undervalued at current prices and suggest buying outright shares, or call options out to July, for a medium-term price target of $25.50.

Newcrest Mi

 

Chart Watch – XJO Index

Posted on | by Leon Hinde | Leave a Comment on Chart Watch – XJO Index

The XJO chart is showing the first lower low structure we’ve seen for some time.

The broader trend, which has been in place since  February 2016 is likely in the early stages of breaking lower. Any bounce higher from last week’s selling, is likely to be limited and investors should look to protect their portfolios.

New selling will likely occur within the range of 5790 and 5850, creating a lower high formation as a strong sell side signal.

Chart – XJO

 

 

 

 

Algo Buy Signal – Resource Sector

Posted on | by Leon Hinde | Leave a Comment on Algo Buy Signal – Resource Sector

With the recent sell-off in commodity names, the Algo Engine has triggered buy signals in a number of big and small cap companies.

Our preferred resource allocation remains BHP, over other alternatives. However, it’s worth taking note of the recent buy signals in RIO, FMG, IPL and in OOO, the BetaShares Oil ETF.

We look to take profit in BHP at $25, after buying at or near $22.50.

Chart – Oil

 

 

ALGO Engine Buy Signal For NAB

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

The ALGO engine triggered a buy signal for NAB at $30.40 on Friday.

NAB shares have dropped over 11% since posting an intra-day high of $34.00 on May 1st. Several internal momentum indicators are showing an overbought condition.

With US equity markets stabilizing after Wednesday’s sharp sell off, it’s likely that all the local banking names will get a lift when the ASX re-opens on Monday.

We see scope for a corrective bounce into the $32.50 area, and suggest looking to buy NAB shares outright, or consider buying the $32.00 call options into June.

Aussie Dollar Pops Higher After Jobs Data

Posted on | by Todd | Leave a Comment on Aussie Dollar Pops Higher After Jobs Data

The AUD/USD traded higher after yesterday’s domestic employment numbers beat expectations.

With headline jobs growth reported at 37.4k (versus 4.5K consensus) the AUD/USD pushed against the resistance level at .7450.

We don’t expect these data to move the RBA from their easing bias and, if benchmark overnight rates are going to move, the likely direction will be lower, not higher.

Investors who want to profit from a falling AUD/USD can buy the BetaShare ETF with the symbol: YANK.

YANK is an inverse EFT, which means that the unit price trades higher as the AUD/USD moves lower. YANK is also weighted, so that a 1% fall in the currency translates to a 2.5% gain in the unit price.

When the AUD/USD traded down to .7330 last week, the unit price of YANK was $15.54. We estimate that if the AUD/USD trades back to the January low of .7150, the price of YANK will be $16.50, or an approximate 10% gain from current levels.

YANK ETF

 

 

 

 

 

 

Chart Watch – Goldman Sachs

Posted on | by Leon Hinde | Leave a Comment on Chart Watch – Goldman Sachs

Goldman Sachs has sold  off $40 since the high created on the 1st of March. The chart image below shows price action is now finding minor support within a weakening short-term channel.

We’ll continue to watch the chart pattern unfold with anticipated resistance back up at $230.

The relevance of tracking GS for local investors, is it may provide an indication  as to when our local banking & finance stocks will find new selling pressure, should they have a minor bounce from yesterday’s lows.

Chart – Goldman Sachs

 

 

ETF Watch – IVV (S&P500)

Posted on | by Leon Hinde | Leave a Comment on ETF Watch – IVV (S&P500)

The IVV is an iShares ASX listed ETF that provides exposure to the S&P500 index of stocks.

Our Algo Engine has triggered multiple buy signals over the past 3 years and so far, no sell signals. However, with the index at 18x earnings and deteriorating global economic data, we feel now is an opportunity to lock-in gains and wait for the next Algo Engine buy signal.

Chart – IVV