Member Info for usually_right

at the next meeting, with the europe situation, absolutely. personally think we have another 5-10% on crude maybe. dont think well see much below 55 on brent while wti should hold at 50. i think that works with the assumption europe gets back on track numbers wise in the next few weeks. which i think will be the case given the new lockdowns.

brent over 50 for next 12 months is acceptable. over 60 is a plus, over 70 would be unexpected but of course provide huge beat for cash flow. europe can simply put back the recovery not upend it, given uk and us plus asian progress. there is undersupply of a few million barrels per day which can only be filled by opec, who arent keen on doing much here. the fact that oil struggles for funding now means opec sees less threats and so likely to hold off longer.

keep an eye on crude today. it tested support today but if the days lows dont hold there could be another 2-3% down side on brent.

short term crude has got ahead of itself. but further out there will be a supply issue. there has been little investment in new fields and going forward its going to be next to impossible to get funding given the esg implications. banks are under attack not to fund oil. yet the world will still need millions of barrels per day for the foreseeable future. the drive to net zero is going to ensure this. so while the sector does face a structural issue in the long term, the medium term view is still for undersupply. the short term picture is more mixed and should allow for another 5-10% retracement on the barrel given the vaccine delay in europe but i dont think brent moves below 50 bucks before moving above 70 bucks. in terms of the bp sp, it think the gap at 261 may be filled in a negative case but the shares may bounce from 272/280 if crude doesnt fall too much.

while some markets are quite fully priced, i dont think its something you can label the ft100 with (nor the the ft250), especially if we are entering a rising rate environment. you might argue that it may last only 12 months or so. but since its hard to predict the future, it may be possible that in 12 months time we are still talking about rising inflation. in the meantime, rising rates are good for the basket of stocks that its the ft 350. most of the shares in there arent tech nor or high valuations. most of them have tended to work well in an environment of some inflation and rising rates. so if you think the economic recovery still has legs and that bond yields are going to rise due to rising inflation, then the ft350 basket may still have quite some way to go. we own view is that i would reconsider this position come autumn this year but not before, unless we got some data or an event which caused the underlying trend to change direction for good.

so the shares have now had a reasonable pullback and offer an opportunity to get involved again. theres some support around 32/33 quid. i would considering add by 28/30 quid too if seen but thats not a given. a ftse near 6400/6500 might get us there otherwise unlikely.

the ft100 is bordering on a large upside breakout, so in worst case i dont see much downside for bp as it may still go up just underperform ie. go up less than others. if the breakout doesnt come, id expect the shares to fall a bit more than others. but there is support a couple of hundred points lower from here and i would certainly use that occasion if it happens (we may still break higher today or tomorrow) as a chance to buy.

i agree with you but i think oil and oil shares have had a good run and now others with take over in the near term to move the market higher. the miners and oils may underperform imo but that would be a buying opportunity as its all about rotation within the rotation. i think bp will be a cracking buy if pulls back under 3 quid. 270-290 plenty of potential levels for reversal to upside again. for now im standing aside.

yes they are reporting some brexit related issues but the fact is london housing may not see the demand it has been used to this year and the shares have been underperforming some time esp since board member sold a lot of shares earlier this year. reservations are also expected to be down 20% they say. overall the results arent as bad as they could be but compared to other builders, theres not much to shout about and you worry about the momentum this year. i think if london begins to see a rerating these are the sahres you want to be in but director selling earlier suggests they dont see that playing out near term.

its all about yields. yields were already travelling higher yest afternoon and have gone even higher overnight to close a techincal gap. if may be that is all for the day but if 1.6% is broken on the 10 year, yields are going to push higher. if they cannot breach the 1.6% you may see a retracement back to 1.4%, this would support the market in general but financials would underperform.

any dividend triggers a tax event hence buybacks are often chosen since they are more tax efficient

in the near term the shares are going to track long term us yields. so i wouldnt rule out some weakness. but i think if that happens its a buying op for a move higher.

personally if it was me with a 57/58 average, i wouldnt do anything here. i tend to wait for a bigger move away from my entry unless there is some major news which warrants adding closer to my entry point, something i feel will provide a lasting change in trend. otherwise i would sit on my hands and let things play out. if it drifts to 51/52 support, add there as long as the story stays the same. but if it moves higher and breaks the 64 high, consider adding on the next pullback from there if you still believe the story has legs.

158-160 looks a potential zone to add but i cant say it will be seen looking at it right now. sometimes doing nothing is the correct course of action particularly if you are already involved in the trade to some degree.

its reacting reasoanbly well to the price downgrade from liberum today. a finish at around 57 would leave a bullish daily candle and would possibly mark the pullback low. a weaker finish may mean support by 51/52 will need to be visited. amongst those supports is a trendline from march lows, which youd expect to hold if the commodity trade is to remain intact.

its possible but market had a fit when rates moved from 1.2 to 1.6 quickly. and we havent seen the whites in the eyes of inflation yet. inflation is going to go up every month for the next few months. i would expect the market to throw another tantrum as yields rise, because thats what they do. if rates manage to form a top around 1.6, then panic is over. however, i just cant see them staying calm when cpi prints 3% in may espeically since we are at half that now. the market will worry that inflation will keep rising and that its not transitory. i suspect inflation may rise until the summer and that it will be transitory but i cannot know this for sure and i may be wrong.

todays inflation report from america will dictate if the shares can bounce further or if the top for the bounce is in. higher inflation means higher yields and lower tech stocks. todays high has filled the gap from 3/4 march. there is a gap at 1118 to fill from todays open. although the shares did trade below the 200dma, they havent been able to close significantly below it. depending on your chart data provider, the 200dma is going to be in the 1027-1033 region.

theres some well defined support at 34 quid. below there 32-33 quid should hold before a new rally. i dont see much downside below there unless the market as a whole was to move significantly lower.

LLucan i completely agree with what you have said, but i use the share price as the ultimate guide. the market has not been discriminating between good and bad, only value, tech, reflation, reopening. just about 99% of each group has moved up and down together, bar a few outliers. given a period of solid underperformance by the share price and in an environment where yields are rising as so the reflation trade is intact, i could be persuaded to buy the shares. thats is as far as id go. i still hold positions in aviva and l&g (and dlg fwiw) but i am not prepared to give sla the benefit of any doubt and if involved its only short term where a period of outperformance by the shares is expected.

i think the results come on a bad day for value/financial/reflation plays in that bond yields are lower, techs are higher and the shares have been on a run. what the rally has shown us is that a rising tide lifts all boats and while i think avvia and l&g are better plays, you should still expect SLA to trend with them higher once bond yields begin to move higher again after a pullback. if bond yields dont move higher id expect these to struggle more than the others. for now that doesnt look like a base case so i could be persuade to buy maybe 250-270 depending on where bonds are and how they look to be doing.