ETF Update: Exit The OOO Crude Oil Trade

Posted on | by Todd | Leave a Comment on ETF Update: Exit The OOO Crude Oil Trade

Despite a larger-than-expected fall in US Crude Oil inventories, the price of West Texas intermediate (WTI) Crude Oil failed to hold the recent gains above the $45.50 level and looks to be rolling over.

The US EIA reported that crude oil in storage fell by 6.3 million barrels versus an expected fall of 2.3 million barrels, which pushed WTI up to an intraday high of $46.25. 

However, news that OPEC producers have not agreed to renew their production cuts has prompted investors to believe that Crude Oil supplies are not going to balance in the near term.

We suggested buying the BetaShare Oil ETF with the symbol, OOO in the $12.35 area on June 22nd. We now suggest closing that position in the $12.75 area and looking for another opportunity to enter the market on a test of the $41.00 level.

BetsShare OOO  

 

 

 

 

Real Estate Sector – Now Oversold

Posted on | by Leon Hinde | Leave a Comment on Real Estate Sector – Now Oversold

As bond yields have pushed higher in recent weeks, following global central banks hawkish tone, we’ve seen capital rotate out of yield sensitive names such as infrastructure and property and  into financials & resources.

The rotation now leaves property stocks approaching an oversold price zone.

The chart below provides a broad-based picture of the listed property stocks within the ASX 200, via the SLF.AXW (SPDR ASX200 Listed Property ETF).

Our Algo Engine has triggered a buy signal at or near $12.00.

Chart – SLF

 

ALGO Update: IPL Showing Increased Upside Potential

Posted on | by Todd | Leave a Comment on ALGO Update: IPL Showing Increased Upside Potential

On May 23rd, the ALGO engine triggered a buy signal in IPL at $3.40. Since then the stock has traded in a moderate range of $3.30 to $3.60.

While we view the outlook as broadly positive given the ramp up of the WALA ammonia plant in Louisiana and domestic fertilizer demand, this has been offset by the upcoming change in their CEO and declines in global fertilizer prices.

IPL is currently trading at 30% discount to its North American peers, and at 13x  estimated FY 18 earnings, we see the upside potential into the $4.15 range over the medium-term.

At the same time, we expect the 2017 EPS of 21 cents to rise to 25 cents in FY18, which puts the stock on a forward yield of 4%.

IPL