BHP is part of Australia's DNA. How BHP rose from the humblest beginnings in the Australian Outback to become the world's biggest mining company and rise to starry heights on the great bourses of the world is a great story.
(For a few misguided years BHP formed a dual-listed company with Anglo–Dutch Billiton plc - who had made their first fortunes on the Indonesian island of Belitung - but that episode is best forgotten by its Australian shareholders.)
My investment portpolio is comprised of shares in BHP, BHP, BHP, and BHP - in that order - so whenever the so-called 'experts' tell me otherwise - for example, since at least 2019, the ‘boffins’ at the Australian Treasury had iron ore pegged at US$55 a tonne for an age before they looked out the window and noticed the price was way beyond their ridiculous underestimate - I dust off my copy of "The Big Fella" and maybe also have a quick skip through "The Olympic Dam Story", the second-largest mineral resource in the world, behind only Norilsk's nickel-copper-platinum-palladium ore fields in Siberia, to reassure myself that BHP is a contrarian bet very much worth taking.
I mean, at the start of the year none of the investment banks foresaw iron ore going over US$200 a tonne. But there it demonstrably sits right now for the high-grade stuff. And I don’t think the full impact of this has been factored into BHP's price yet which is why the results for this quarter are so important. Most analysts had the second half of 2021 pegged as the period when iron ore would run out of steam.
I hope they listened to Xi Jinping’s 1 July speech marking the 100th anniversary of the Chinese Communist Party: "We will never allow any foreign force to bully, oppress, or subjugate us. Anyone who would attempt to do so will find themselves on a collision course with a great wall of steel forged by over 1.4 billion Chinese people." That ‘great wall of steel’ will surely need a great deal of Australian iron ore.
The longer the price of iron ore stays high, the more pressure builds up to rerate the shares (Goldman Sachs' target price is $53.80). Meanwhile, the company will be paying out truckloads of fully-franked dividends.
P.S. Here is today's Trading Central's assessment:
Trading Central has detected a "Triple Moving Average Crossover" chart pattern formed on BHP Group Ltd (BHP:ASX). This bullish signal indicates that the stock price may rise from the close of 48.45.
Tells Me: The price is generally in an established trend (bullish or bearish) for the time horizon represented by the moving average periods. Moving averages are used to smooth out the volatility or "noise" in the price series, to make it easier to discover the underlying trend. By plotting the average price over the last several bars, the line is less "jerky" than plotting the actual prices. In the triple crossover method, a bullish signal is generated when a faster moving average (4 bar) crosses above an intermediate moving average (9 bar), which in turn crosses above a slower moving average (18 bar). In this state, the price is likely in an established uptrend. The opposite is true when the 4 bar crosses below the 9 bar which in turn crosses below the 18 bar, triggering a bearish event.
This bullish pattern can be seen on the above chart and was detected by Trading Central proprietary pattern recognition technology.
P.P.S. Recent closing prices:
17/6/21 $47.69 (Low $47.45/High $48.33)
18/6/21 $46.52 (Low $46.21/High $47.31)
21/6/21 $45.61 (Low $45.61/High $46.09) was this the bottom???
22/6/21 $46.68 (Low $46.33/High $46.89)
23/6/21 $47.16 (Low $46.80/High $47.45)
24/6/21 $47.60 (Low $47.36/High $47.79)
25/6/21 $47.90 (Low $47.77/High $48.10)
28/6/21 $48.40 (Low $48.04/High $48.54)
29/6/21 $48.06 (Low $47.65/High $48.12)
30/6/21 $48.57 (Low $48.27/High $49.10)
1/7/21 $48.22 (Low $48.18/High $48.74)
2/7/21 $48.55 (Low $48.16/High $48.59)
5/7/21 $48.45 (Low $48.21/High $48.58)
6/7/21 $48.85 (Low $48.64/High $49.36)
7/7/21 $48.80 (Low $48.01/High $48.81)
8/7/21 $49.66 (Low $49.38/High $50.03)
9/7/21 $49.48 (Low $49.11/High $49.63)
12/7/21 $51.05 (Low $50.87/High $51.33)
13/7/21 $50.70 (Low $50.70/High $51.61)
14/7/21 $50.96 (Low $50.73/High $51.22)
15/7/21 $51.53 (Low $50.78/High $51.66)
16/7/21 $51.87 (Low $51.27/High $51.91)
