CHI - Channel Infrastructure Ltd (NZR)

[Hoop]

If using TA and charting it aint no gambling stock to see which way this ugly baby been going.

It's a bear and we have just witnessed the end of the 3rd sucker rally and has broken support 2.43 seemingly on its way down to form another lower low...
Todays 1c rise to 2.43 hits its newly formed resistance line (old support) is a quick pullback to test its breakdown price..It will need buying pressure to break back...Even then you need a higher higher high of 2.70+ before the bear becomes sick..

It didn't matter how well NZR looked 5 months ago..when multiple sell signals go off in quick succession.. it is nearly always not a good sign..TA is waving a very big red flag for you to notice...
Some investors may have stayed in because these multiple sell signals were unusual by occurring at the very top with little decline...but..as soon as the longer term MA200 breaks together with medium support at 3.30...it's sell time (even for the longer term investors)...Quit while your ahead and wait until the bear dies..

EDIT: I forgot to add the new primary downtrend line..which nicely touches the tops of the 3 sucker ralies..this down trend line is very steep..a warning sign to stay clear until it breaks...The trend is your friend or your enemy...you choose

[Mickey]

If using TA and charting it aint no gambling stock to see which way this ugly baby been going.

It's a bear and we have just witnessed the end of the 3rd sucker rally and has broken support 2.43 seemingly on its way down to form another lower low...
Todays 1c rise to 2.43 hits its newly formed resistance line (old support) is a quick pullback to test its breakdown price..It will need buying pressure to break back...Even then you need a higher higher high of 2.70+ before the bear becomes sick..

It didn't matter how well NZR looked 5 months ago..when multiple sell signals go off in quick succession.. it is nearly always not a good sign..TA is waving a very big red flag for you to notice...
Some investors may have stayed in because these multiple sell signals were unusual by occurring at the very top with little decline...but..as soon as the longer term MA200 breaks together with medium support at 3.30...it's sell time (even for the longer term investors)...Quit while your ahead and wait until the bear dies..

EDIT: I forgot to add the new primary downtrend line..which nicely touches the tops of the 3 sucker ralies..this down trend line is very steep..a warning sign to stay clear until it breaks...The trend is your friend or your enemy...you choose

Thanks for your insights Hoop. Jeez, I feel like a complete novice when I read this TA stuff. I know very little about TA and had based my decision to invest in NZR on fundamentals and in anticipation of lower oil prices (based on everything I was reading at the time) and a falling US dollar. The last 2 haven't quite played out, which is probably why we are seeing reduced margins and a depressed SP. I guess I will have to hope that NZR heads back towards my purchase price at some point in the same way that my CNU shares finally did. In the meantime, hopefully dividends will continue while I play the waiting game. I'm not intending to DCA at this stage but may consider this as an option once the SP finds its bottom. Thanks again.

[cyclist]

If using TA and charting it aint no gambling stock to see which way this ugly baby been going.

It's a bear and we have just witnessed the end of the 3rd sucker rally and has broken support 2.43 seemingly on its way down to form another lower low...
Todays 1c rise to 2.43 hits its newly formed resistance line (old support) is a quick pullback to test its breakdown price..It will need buying pressure to break back...Even then you need a higher higher high of 2.70+ before the bear becomes sick..

It didn't matter how well NZR looked 5 months ago..when multiple sell signals go off in quick succession.. it is nearly always not a good sign..TA is waving a very big red flag for you to notice...
Some investors may have stayed in because these multiple sell signals were unusual by occurring at the very top with little decline...but..as soon as the longer term MA200 breaks together with medium support at 3.30...it's sell time (even for the longer term investors)...Quit while your ahead and wait until the bear dies..

EDIT: I forgot to add the new primary downtrend line..which nicely touches the tops of the 3 sucker ralies..this down trend line is very steep..a warning sign to stay clear until it breaks...The trend is your friend or your enemy...you choose

Thanks Hoop. With examples like this, I struggle to understand those on this forum who scoff at TA. As always, thanks for taking the time to produce these sort of posts.

Disc: Still holding. Dammit!

[BlackPeter]

Good technical analysis, hoop - and you are right, it could (and if I look at the current depth) it is likely to go further down. A handful of desperate punters reading this thread (yes, the trading volume looks very very thin) and we are going to test 2.10 (which looks like the next resistance point). My point - any punter selling only a handful of shares will currently skew the picture ... highest bidder currently at 2.38.

Question is - how far further is it going to drop from here? The share moved around $1.80 2 years ago ... and this was when the refinery was writing losses, they had to find the money for their Te Mahi Hou project, the oil price was really high (bad for NZR) and the USD was at crazy levels (bad as well).

At current they make money (predicted EPS for 2016 23cts / share), pay nice dividends (they can afford), Te Mahi Hou is completed and delivers, oil is cheap (good for NZR) and while the BREXIT pushed the USD up again, it is not as high as it used to be.

My point - yes, the SP might further drop as you said (but in my view on low volumes). This means that sellers will find it easy to further smash the price ... but after a turning of the tide it might be quite difficult for them to get back in below their selling price (given that most holders just sit the current dip out - i.e. it will lift on low volumes as well).

Discl: holding and intending to sit it out.

[BlackPeter]

Looks like somebody read my prediction about low volumes and potentially further dropping prices and started to buy in order to prove me wrong. SP still holding (with a slight tick up). Ah well, can't get it always right

[hamish]

From Forsyth Barr - 18 May 2016

Our rating os OUTPERFORM. The medium term outlook for fuel refining is generally positive and NZR has several initiatives that should help its GRM and help it remain competitive with overseas refineries. The market is currently pricing NZR on undemanding GRM and USDNZD assumptions providing investors an attractive entry point

[freddagg]

From Forsyth Barr - 18 May 2016

Our rating os OUTPERFORM. The medium term outlook for fuel refining is generally positive and NZR has several initiatives that should help its GRM and help it remain competitive with overseas refineries. The market is currently pricing NZR on undemanding GRM and USDNZD assumptions providing investors an attractive entry point

And Craigs research out today has it with a target price of $3.65 and a gross dividend yield of 13.4% for 2016.

There"s a lot of negative analysis on this thread but it is not based on fundamentals.

[Hoop]

And Craigs research out today has it with a target price of $3.65 and a gross dividend yield of 13.4% for 2016.

There"s a lot of negative analysis on this thread but it is not based on fundamentals.

If you referring to me and the charts...don't shoot me ..I'm just the messenger .

Look at it this way.....negative data = negative data analysis....

It doesn't matter if 1000 brokers all sing "Knees up Mother Brown", ignore or dismiss the negative trend and it will burn a hole in your pocket..If the brokers are right then just wait until the tide turns (change of trend)...easy really..eh

[BlackPeter]

Just came around to look through the June 2016 IEA report (https://www.iea.org/oilmarketreport/omrpublic/) and came across the following statement:

Refinery runs in 2Q16 are suffering from deepening outages. Throughput is nearly flat year-on-year, as refiners finally catch up with maintenance postponed from 2015. The seasonal ramp-up to 3Q16 is expected to be the largest on record, surging by about 2.3 mb/d quarter-on-quarter.

This should in my view help NZR. Margins should go up if their competitors need to shut down due to maintenance. Good thing that NZR kept on top of its maintenance schedule and has (as far as I know) no further shutdown planned for this year.

[freddagg]

Just came around to look through the June 2016 IEA report (https://www.iea.org/oilmarketreport/omrpublic/) and came across the following statement:



This should in my view help NZR. Margins should go up if their competitors need to shut down due to maintenance. Good thing that NZR kept on top of its maintenance schedule and has (as far as I know) no further shutdown planned for this year.

Since we have now started 3Q16 I would think a ramp-up in worldwide output would be bad for NZR