ALGO Sell Signal For Woodside Petroleum

Posted on | by Todd | Leave a Comment on ALGO Sell Signal For Woodside Petroleum

Our ALGO engine triggered a sell signal in WPL into the ASX close yesterday at $32.20.

This corresponds to the ALGO buy signal triggered on February 20th at $29.10. Investors who followed this trade would have gained over 10% on the trade.

As noted in previous postings, the WPL share price is closely correlated to the price of WTI crude oil, which has been trading near 4-year highs over $68.00 per barrel.

Recent increases in crude oil supplies have been offset by political tensions in the Middle East, which have kept oil prices buoyant.

We believe that WPL shares are overbought and susceptible to trading lower along with spot crude oil prices. As such, we suggest exiting long WPL positions near the $32.35 level.

Woodside Petroleum

WTI Crude Oil Retreats From 4-Year High

Posted on | by Todd | Leave a Comment on WTI Crude Oil Retreats From 4-Year High

Over the past three weeks, the price of WTI Crude Oil has rallied over 12% and posted a four-year high at $69.35 in early NY trade last night.

However, WTI closed the session down 1.4% at $67.70 after the US and France announced they were close to reaching a deal to renew the Iran nuclear agreement, and a surprise increase of a million barrels in weekly API inventory data.

It’s worth noting that speculators have amassed a very large net long position in the WTI futures market. As of the April 17th report, the non-commercial net long position stood at 728,000 contracts.

This long exposure is just below the record high of 739,000 contracts set in early February when WTI peaked at $66.30.

Technically, the daily internal momentum indicators for WTI are stretched but not yet overbought.

The deadline for renewing the Iran agreement is May 12th. It’s likely that the  ongoing negotiations of that agreement will have a strong influence on the near-term price action of WTI.

From a “cause and effect” perspective, any political hurdles in extending the Iran agreement will see WTI trade higher, while the perception of a successful agreement will likely push WTI lower.

Local shares OSH, STO and WPL have all rallied sharply over the last three weeks and have a strong correlation to crude oil prices.

As such, we urge investors to be cautious of increased volatility in the crude oil market and how it could impact these local oil names.

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Woodside Petroleum – 1Q18 production

Posted on | by Leon Hinde | Leave a Comment on Woodside Petroleum – 1Q18 production

1Q18 revenue for WPL was slightly softer than expected at US$1.169 billion.

Expansion of the WA-based LNG operations will provide longer-term growth, especially given the strength of fundamentals supporting LNG.

Post the acquisition of Exxon’s interest in Scarborough, WPL now holds a 75% stake with partner BHP holding 25%.  We expect BHP to be a natural seller of its remaining interest.

Woodside Petroleum

OSH Nears Resistance at $7.90

Posted on | by Todd | Leave a Comment on OSH Nears Resistance at $7.90

The price of West Texas Intermediate Crude Oil (WTI) posted its largest weekly advance in over four years.

The 9% gain for the week in WTI also lifted the local oil names, including OSH, STO and WPL

Our ALGO engine triggered a buy signal in OSH on February 13th at $7.10.

At the time, our initial upside target was at $7.70.

With today’s high posting of $7.75, We can see the logic in taking profits in OSH and rotating into WPL.

Taking into account the sharp selloff after announcing a capital raising on February 2nd, we consider WPL a better long-term value in the oil sector.

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Woodside Petroleum

Local Oil Names Firm As WTI Extends Recent Gains

Posted on | by Todd | Leave a Comment on Local Oil Names Firm As WTI Extends Recent Gains

West Texas Intermediate (WTI) Crude Oil rose over 3% in NY trade to reach a 7-week high of $65.70.

The boost was a result of EIA data showing US crude stocks unexpectedly fell by 2.6 million barrels, or 0.6%.

For the week, WTI has risen over 5%.

In Monday’s blog, we mentioned our preference to buy local names STO, WPL and OSH.

These three stocks are up over 2% for the week and we still see scope for further upside range extension. Also, all three of these stocks are in our ASX Top 50 Model portfolio.

On the daily charts, the next area of resistance for STO is near the $5.65 level, with support at $4.90.

The chart of OSH shows resistance at $7.70 and support at $7.05

The valuation metrics for WPL are more complex. The share price has under performed the Spot WTI price by 24% since September and is 21% below it’s EPS momentum trend.

At 6.50 X EBITDA, WPL may be the best pick for a move back into the price gap above $29.65.

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Woodside

WTI Rally Lifts Local Oil Names

Posted on | by Todd | Leave a Comment on WTI Rally Lifts Local Oil Names

The price of West Texas Intermediate (WTI) Crude Oil rose 3.5% last week and settled just over $62.00.

This places WTI pretty much in the middle of the $66.80 to $58.00 range we have seen so far this year.

What makes this noteworthy is that last week’s rally coincided with a rally in the USD.  In short, the USD vs Crude inverse correlation looks to be diminished for now.

The technical picture in WTI is improving and the next upside target is near the February highs of $63.40.

As a result, shares of STO, WPL and OSH are all up over 1.5% in early trade today.

All three of these stocks are in our ASX Top 50 Model Portfolio and we prefer the long side from current levels.

We’ll update each of these stocks in subsequent postings.

Woodside Petroleum

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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: Woodside Is In The Buy Zone

Posted on | by Todd | Leave a Comment on ALGO UPDATE: Woodside Is In The Buy Zone

With the company announcing a rights issue last week and going ex-dividend for 62 cents today, shares in WPL have been very active.

Our ALGO engine triggered a buy signal on Monday at $28.63.

This signal has a technical basis on the “higher low” structure relative to the $28.20 low posted in September and the $22.90 low from November 2016.

From a fundemental perspective, we believe the company’s decision to raise money to secure a bigger stake in the Scarborough gas field ensures steady earnings growth during 2018 and beyond.

We expect to see investor support for WPL in the $28.50 area and a move back into the $31.00 handle over the medium-term.

Woodside

 

 

WPL Update: Rights Issue Pegged At $27.00

Posted on | by Todd | Leave a Comment on WPL Update: Rights Issue Pegged At $27.00

Shares of Woodside Petroleum remain suspended today pending the final details of their $2.5 billion equity raising.

The company has been clear that the majority of the fresh equity will be used to increase their stake in the Scarborough gas field in WA.

Early reports from institutional brokers signal that the 1-for-9 rights issue at $27.00 is being filled without any hesitation.

As a point of reference, WTI crude oil closed $60.50 per barrel last night. The last time WPL shares traded at $27.00 per share, WTI was near $42.00.

Our ALGO engine triggered a buy signal for WPL on February 12th at $31.30. WPL was added to our Model Portfolio on June 6th at $31.05 per share.

WPL shares are expected to trade again on Monday the 19th.

Woodside Petroleum

 

 

WTI Drops 3% On Higher US Production

Posted on | by Todd | Leave a Comment on WTI Drops 3% On Higher US Production

West Texas Intermediate (WTI) crude oil fell to a seven-week low of $58.07 per barrel, before paring losses to close Friday’s NY session down 3.2%  at $59.20.

This was the sixth consecutive day that Crude oil has traded lower. For the week, crude oil was down nearly 10%.

WTI broke below $59 a barrel after Baker Hughes reported the U.S. oil rig count rose by 26 rigs to 791, the highest total since April 2015.

The week’s losses accelerated on Wednesday after AEI data showed weekly U.S. production jumping to a record 10.25 million barrels a day. Meanwhile, the nation’s stockpiles of crude rose for a second straight week.

Our ALGO engine triggered a buy signal in both OSH and WPL on Friday’s close.

We expect the sharp down move in WTI to push both OSH and WPL back in the buy zone near last week’s lows of $7.20 and $31.05, respectively.

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