Chart view FWIW, non log.
May have found a bottom, with a higher low and high.
Red lines resistance.
Green circles possible breakout points.
Support and resitance are points on the chart where a stock stops at, or bounces off. This can occur both horizontally and diagonally on a chart. On the way down, better support is where the stock has found previous resistance on the way up; and on the way up, more resistance is where there was previous support on the way down. When a stock breaks resistance on the way up, this is a good thing, breaking support poor. Stocks will only generally be considered going 'up' if they are making higher lows and highs in the chart. However, there can be short, mid and long term perspectives on this, of course. From the chart commented on previously, there is resistance at 16 and lots more between 19 and 21. Until these are broken, the stock is at risk of trading sideways. As a long term investor in blue chips, you would be less concerned with the shorter term aspects of price movement. However, my personal approach is to keep in something that is at least mid term up, or the money is better in the bank earning interest. In regard to CTX, it is back to where is was in May 05, so it's definately not trending long term up IMO. Mid term it's way down, and will be short term up when it makes some higher highs and lows and breaks those resistance lines. All the best, kennasThanks kennas and Kymne. I don't know how to interpret a chart. Do the comments above [which I went to a glossary about] suggest that we may be near a buy time but that growth expectations are only modest and that the short-term rewards are more likely to be in the dividends?
And may I ask what FWIW means please?
Thanks. I'm working with chart-knowledge that can only go in one direction...
Cheers
Rick
I looked a bit at Caltex due to it's attractive P/E and dividend.. however I cannot see it rising strongly due to a few concerns.
The main concern with Caltex I have read in a couple of reports, is that the profit margins for Caltex (and other refiners) is gradually shrinking. While the price of oil is going up, they pay for their oil in $AUD, so the USD/AUD eats into that right now. It's also hard to ratchet up petrol prices equally with oil price rises due to consumer concern, and probably Government pressure.
Strong competition from Asian refineries is making it more difficult for local refineries to compete effectively, which also doesn't help.
With Caltex, apparently it's refinery equipment is starting to get quite old, and will require high expenditure in the near future to keep it up to scratch. This of course may require a lot of costs incurred in maintenance or replacement - not good in a difficult finance market.
Then again, it's got 4 "strong buy" recommendations, and 6 "moderate buy" recommendations (total 10 brokers) which is pretty high.
Support and resitance are points on the chart where a stock stops at, or bounces off. This can occur both horizontally and diagonally on a chart. On the way down, better support is where the stock has found previous resistance on the way up; and on the way up, more resistance is where there was previous support on the way down. When a stock breaks resistance on the way up, this is a good thing, breaking support poor. Stocks will only generally be considered going 'up' if they are making higher lows and highs in the chart. However, there can be short, mid and long term perspectives on this, of course. From the chart commented on previously, there is resistance at 16 and lots more between 19 and 21. Until these are broken, the stock is at risk of trading sideways. As a long term investor in blue chips, you would be less concerned with the shorter term aspects of price movement. However, my personal approach is to keep in something that is at least mid term up, or the money is better in the bank earning interest. In regard to CTX, it is back to where is was in May 05, so it's definately not trending long term up IMO. Mid term it's way down, and will be short term up when it makes some higher highs and lows and breaks those resistance lines. All the best, kennas
Caltex is a refining and marketing company, not an oil exploration and production company.I am an oil bull, think long term price only going one way. Does Caltex have any production assetts or only a oil refiner/retailer?. Without any production assetts a rising oil price would be only negative or at best neutral to Caltex share profitability.
Don't forget that refined petroleum products (diesel, petrol, kerosene etc) are a market in themselves. It's the gap between the crude oil price and the refined product price that matters to CTX more than the actual prices of either. So it's the price of refining itself rather than the price of crude oil that matters here.The bottom line for CTX will be 20% better off due to currency movement alone, and with falling oil price this will help margins again won't it???
What do people think of Caltex at these sub $7 levels?
I remember buying CTX last year at 20.00 and sold at 22. They have performed terribly since crude shot up earlier this year, hurting their refining margins. But since, Crude has come off, as well as the AUD, which should benefit Caltex.
Their forward EPS shows growth in earnings:
2007 2008 2009 2010
EPS 164.4 50.2 120.0 143.5
DPS 80.0 44.8 66.0 71.0
It also have a dividend yield of 9.1% - does anyone know what is the likelihood of a dividend cut for Caltex?
well its definately looking abit sick, ive got a short in at the moment, more it goes down, the more i make.
How much did you get (units)?
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