LONG DHTExpecting bounce from extremely oversold weekly and daily levels. If stop breached, be prepared to catch new daily reversal on lower levels with a tight stop.
DHT/N trade ideas
DHT forming large cup and handle? Potential target of USD 12,-So the first thing I want to show you is this:
In the 'old' days, this stock was trading at well over USD 42,- and since then has made a free fall to the range where it is now. This means relatively little resistance once we break above the top of this cup around 8.90. First stop only at 12 and second at around 18. So pretty interesting on the up side.
Now for the Cup and Handle itself.
The rule of thumb is that the handle cannot exceed about 50% of the total height of the cup. Which it has in this case. But I'm not totally in despair. But it is why I'm keeping a very close eye on DHT getting above 6.0.5-6.10 again (ideally 6.51, the current level of the 50MA on the weekly chart). If it does then the cup might still be alive. Confirmation of the cup once it can break above 8.90.
If any interesting buying opportunity in between those numbers, I'll try to make a further update.
DHT Upward trendlineDHT bouncing off of trendline for the third time. The 5 min chart is showing a descending triangle, which is technically a bearish signal, so I am going to wait for a bit to make sure that the price holds above the trend line. I hope to get in below $6.40.
I'm willing to risk about 4.5% on this, which gives me a risk to reward of about 6.5 if all goes well.
Bullish on DHTIn supplementing mah boy Sajal's bullish fundamental analysis on DHT, I did some TA just to confirm the uptrend. It's looking pretty good based on 2 things here: Fibonacci retracement and Stoch RSI. Fibonacci retracement shows bounce at 32.8% line (or $7.73), you can backtest to see the gain from previous bounces =$$$. Second, the Stoch RSI indicator is about to cross. At this level, Stoch RSI is low at, this is a plus. If u backtest it, every recent time it crossed the price shoot. Overall, STONK my friend.... I COULD BE WRONG
DHT... ContinuedAs I had predicted based on the Stochastics on Sunday, DHT had been fairly overbought (above 80). We are currently moving into a more middle ground going into the earnings. Look to DCD or buy in somewhere here.
Yes there are certainly things that have stepped in additionally, with the oil news surplus (Meanwhile, the build-up in inventories was less than expected, rising by 9 million last week, down from a gain of 15 million in the prior week. Analysts expected a 9.8 million-barrel increase in U.S. crude supplies, according to analysts polled by S&P Global Platts.), however, it is again the oil markets who are looking to squeeze any bit of positive news from the -19mm bpd we are still encountering.
Article LInk: www.investors.com
Look to see a reaffirm of the long positions on these tanker stocks, but be careful to also watch the Spot Rates on Tankers (4.28 VLCC Spot Rate - 184kday; 4.29 VLCC Spot Rate - 130k/day), as DHT is solely dedicated to VLCC vessels now. The second important hump will be on May 5th, when the OPEC+ decision "officially" kicks off to limit production. It is more of a psychological barrier, than it is a real one, as Saudi Arabia, Russia, and others have already begun to cut production.
Hoping we get a bounce soonDHT lacking volume right now. 7.63 is a support level, but a break below here could mean a slide further. Hope we rebound up back above 8 today..
Still think this is a longer term play with good upside. Earnings report 12 days from now..
IF it slides lower i will be adding to my positions
DHT Gearing upI think DHT is really gearing up to pop in the next couple of weeks. Earnings on the horizon, with a forecast that i think should get people excited. I am guessing DHT pulls back towards the Mid 7s this week. i dont think this gap up over the weekend is the catalyst we are looking for.
Holding all my positions right now. Call Options expiring in the Fall. Already up 25%.
Could be loading on more if it goes below 7.50
DHT PositionIf you are to look at this chart, it will show you the volume, stochastic, RSI, and commodity.
All indicators point to us continue to trip down as the D line is still above 80 (overbought). We might say low 7's this week. This downturn will bring the D-line into middle territory (50's) until the earnings, which will be posting approximately on May 13th.
Couple of interesting points I wish to pull from the 10k for 2019, that lead me to believe that there are some strong opportunities on the DHT positions:
- In November 2019, the company prepaid the outstanding amounts in respect of DHT Lake and DHT Raven under the Nordea BW VLCC Acquisition Credit Facility (as defined in Item 5), totaling $22.3 million. As a result of such prepayment, the financing facility tranche under the Nordea BW VLCC Acquisition Credit Facility was reduced to $45 million
- Currently, there are 10 tankers on fixed rates through 2022 (various expiries); this has brought DHT in-line for break-even currently around $2,700 USD/day for the remaining 3 quarters fo 2020. The remaining 17 tankers on spot rate include: DHT Mustang, DHT Bronco, DHT Colt, and DHT Stallion (newest tankers; DWT 317,xxx) . They haul the largest amounts of crude, outside of some of the time-chartered tankers
- In 2019, DHT repurchased and retired 725,298 shares of our common stock in the open market at an average price of $4.47 per share. In March 2020, the board of directors approved a repurchase through March 2021 of up to $50 million of DHT securities through open market purchases, negotiated transactions or other means in accordance with applicable securities laws. The repurchase program may be suspended or discontinued at any time. All shares of DHT common stock acquired by DHT are expected to be retired and restored to authorized but unissued shares.
The repurchase of $50 million at current spot prices would equate to retiring 6.5mm shares of common stock out of the 146mm outstanding. Definitely points to a shore-up to strengthen the company's position.
DHT Correcting a bitMarket seems primed for DHT with space to store OIL running out. Tanker business should be good for the future here. Looking at a correction phase in the next week or so which should begin to build back up as we get closer to earnings.
Staying in my Call options here expiring end of Fall.
$DHT LongI don't know if wave theory really even works but It helps me organize my thoughts. DHT and tanker companies are in a really good position with the oil collapse, but if the S&P collapses any further it could drag down everything with it. Projected EPS is around 50 cents for q2 2020, a %330 percent increase from q2 2019, at 19 cents, and reports come out may 13th.
This time last year $DHT traded at 4.80 a share and assuming a %330 increase of EPS, which could very well be sustained throughout the coming recession and global shutdown, the stock could be expected to itself experience a %330 increase from 4.80 and reach around $12 a share, which follows a loose trend line from previous highs, and also matches a 38.20% fib extension for wave 4 I did, which I ended up doing incorrectly :/ but maybe its a sign regardless. Let me know what you think.
Anyways, trade how you want, I will be checking this to see how correct I am and give updates as I think of things.
Tanker Reality...Meaningful data is hard to find, but in all reality, there are some really good short-term opportunities here.
With the first price war concluded between Russia and OPEC, we are seeing that the cutbacks inevitably were not enough.
The timeline was as follows:
2.4.2020 - Trump speaks to a "deal that he has brokered between Russia and OPEC for cuts of between 10 - 15mm b/pd"
West Texas Intermediate crude futures surged 24.67% to settle at $25.32 per barrel, for its largest single-day percentage gain in history.
International benchmark Brent crude jumped 17.8%, or $4.40, to trade at $29.14 per barrel.
12.4.2020 - OPEC+ and Russia agree to terms that conditionally pull out 9.7mm b/pd beginning May 2020. It is said the cuts would be eased to 8mm b/pd between July and December, 2020. Then they would be eased again to 6mm b/pd between January 2021 and April 2022.
What we have is an imbalance to the surplus side, even as Brazil, Europe and the US step in to make further cuts to the oil markets. Currently forecasts, the most optimistic forecasts, are pointing to a reduction of demand leading into the summer of around 18.5mm b/pd. This means that we will be dealing with an overflow roughly to the tune of 10mm b/pd, as oil countries struggle to balance a pull-back without blowback direct to revenue.
Additionally, Saudi Arabia is flooding cheap oil into the Asian marketplace, while holding steady course in Europe.
"State-owned oil company Saudi Aramco has pledged to boost output to 12.3 million barrels a day in April as it cut the May official selling price of its flagship Arab Light crude to Asian customers by US$4.20 a barrel from the previous month, exceeding estimates for a reduction of US$3.63. That was even after it signed a deal with other producers to cut global output by around 10 per cent to try and support prices."
This will further engage a 2nd price war on oil, probably bringing oil into the low teens.
All this glut will offer up big opportunities for tanker companies, as they VLCCs are simply a limited commodity.
DHT on April 1st, locked up 6 tankers for $120mm for a period of 12 months . The new time charter contracts will reduce the cash break-even levels for the company's spot trading ships – down to $2,600 per day for the remaining three quarters of 2020. (seekingalpha.com)
1.4.2020:
Oil tanker rates keep climbing, with benchmark Middle East-to-China rates rising another 2.8% overnight to WS 212.71, equating to daily earnings of $241K, according to Baltic Exchange data.
11 additional ships in March and April for a period ranging between 38 days and 80 days have already locked in revenue for $94mm (avg: 137/day for 61 days). For the remaining part of the calendar year (Jul - Dec) that would be an additional $282mm in profit.
EPS can possibly jump up to $.70 - $.77 for the remaining quarters, which just by pulling the current P/E (ttm) of 14.38 puts us somewhere between $10 - $11 (36% - 51%).
Please also look at the basket of companies that are included (FRO, STNG, TNK). Additional plays on EURN, NNA, INSW to lay-off some risk.
