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BHP - BHP Group

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not a technical expert by any means, but i also saw this chart (i was looking at daily candles though for short term option trading) and interpreted it as showing resistance turned support turned resistance at that $35 level. probably a rather simplistic interpretation though.

sold ATM covered calls last week struck at $35, expiring tomorrow for a 0.80 premium (IV ~40). 40 is well below the 80 or so the IV got to during the heights of the current crisis, but still some way above the historical average for this underlying, which normally floats around the mid 20s type of range.

fairly hefty fall in the underlying today, market currently showing 0.08/0.28 on the 35 calls as i type this, it's early in the session though and spreads are usually rubbish at this time. hopefully it'll give me a chance to buy them back for 0.16 (20% of original premium collected) as the day wears on, it'll be decaying almost by the minute with that tom expiry.
 
insta-filled at 0.15 into a 0.10/0.22 spread. that ended up working better than i expected. don't normally get fills like that this early into a session. thinking (guessing?) it won't break thru $35 resistance for another 2-3 months and will keep looking to do more ATM covered calls at that strike in the coming weeks, especially if IV remains hovering around that 40 level. if it gets called away, then it gets called away. might look at putting some of the proceeds from that last lot of covered calls into some 3 month OTM calls as well though, in case it does end up breaking thru.
 
Trav. said:
@qldfrog BHP are currently building their South Flank mine and ore handling plant and have plenty of ore available in the region. Recent tonnes produced have been excellent even with the COVID restrictions in place. Also I am led to believe that other operators in south america have been impacted more by the COVID-19 which limits China options of finding replacement high grade ore.
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Para in Brazil, home of Carajas mine, has high Covid numbers.
 
Found this from about a week ago. Since then the Covid-19 situation in Brazil has worsened
Iron ore shipments from Brazil have fallen by almost a quarter in May because of the country’s coronavirus crisis, which is one of the worst in the world, said Macquarie analyst Serafino Capoferri. Brazil exported 15.27 million tonnes of iron ore in the first three weeks of May, he said. That is down from 19.4 million tonnes in the comparable period of 2019, when exports were already lower than normal following the fatal dam collapse at Vale’s mine in Brumadinho.

“The situation in Brazil is pretty much out of control,” said Mr Capoferri. He said the pandemic had caused difficulties at the country’s mines, which are more labour-intensive and require people to work closer together than mines in Australia.

Vale has said the coronavirus will reduce the amount of iron it is able to produce this year. The company said in late April it will mine between 345 million and 370 million tonnes of iron ore powder and pellets in 2020, around 40 million tonnes less that it previously expected. Brazil as a whole mined 480 million tonnes of iron ore in 2019, according to the US Geological Survey, a fifth of global production and second only to Australia.
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May I offer a word of caution in all of this merriment and throwing money at the market. Particularly BHP, RIO and FMG. But particularly BHP.

We still are not through this pandemic. All the experts predict a 2nd wave.

This will further disrupt production, delivery to, and need for products such as iron ore and oil by customers.

And then there is the small matter of China.

I never buy BHP for more than $30 and especially like it under $20. In the last 8-10 weeks it has crept up from about $25 to $36 and is now looking as if it may retreat.

gg
 
BHP has increased its nickel footprint in Western Australia with the purchase of a tenement package from Russia's Norilsk Nickel. The deal gives BHP control of the Honeymoon Well project as well as the Albion Downs North and Jericho exploration projects where it previously had a 50 per cent stake alongside MPI Nickel Pty Ltd, a wholly owned subsidiary of Norilsk.

The tenement package is in WA's northern Goldfields and only about 50 kilometres from BHP Nickel West's Mt Keith nickel mine and 100 kilometres from its Leinster nickel concentrator.
“Nickel continues to be an essential input into new technologies that will improve the battery storage needed for renewables and electric vehicle manufacturing," BHP Nickel West asset president Eddy Haegel said on Friday. "Consistent with our strategy to invest in future facing commodities, this transaction gives us access to explore and develop these prospective nickel sulphide tenements.”
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may look at taking a three month call option ATM position on the 10th August -/+1 if price conforms to the timing model . As the primary trend should remain up till October I will be looking to buy on dips .
 
Second scenario could indicate counter trend low into the 28th July followed by an intermediate top on the 10th August which is opposite to the original model . Either way a change of trend is indicated on the 28th July and if price drops into this point I may look at buying a two or three month ATM call option which will give me more time and flexibility . MainTrend should remain up till mid September
 
so there is the option of just riding out the trend till that date and the three month option will be sufficient time for the forecast to play out or alternatively if price moves up into the 10th August by a good margin I may look to close the position on that date and then await a pullback and re enter if I am nimble enough and the options position is liquid enough to exit .
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28th August should be Minor Low before resumption of uptrend into the 19 - 20th October where Major Top is indicated . If price moves down into the 28th I will exit and look to reverse the position with a call option . There are two points where Low is indicated 28th August and the 3rd September so Low could potentially occur on either one of these Dates which are five days apart . Once these Dates arrive market position and volume should give a clearer indication and weight as to which one will be Low
 
one thing I noticed on the Westpac platform is the delay between the option and share price opening . The shares will commence trading at 10.00am approx and the options will come on approx 10 - 15 minutes later . This morning the range was 19.33 to 19.73 on the open or approx 1% during which time the options were still set at 0 . is this situation unique to platforms like Westpac and CommBank and would a broker have access to immediate options data on or just after opening .
 
Student of Gann said:
one thing I noticed on the Westpac platform is the delay between the option and share price opening . The shares will commence trading at 10.00am approx and the options will come on approx 10 - 15 minutes later . This morning the range was 19.33 to 19.73 on the open or approx 1% during which time the options were still set at 0 . is this situation unique to platforms like Westpac and CommBank and would a broker have access to immediate options data on or just after opening .
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Option market makers will not quote equity options for approx 20min after the open till prices stabilize give or take depending on volatility and strike in relation to underlying.

Getting out of a WBC short position this morning was and still is a bit of a waiting game, spreads have opened up a little, also still waiting on my BHP theory to materialize.
 
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