Value Seeker

Commodities | Stocks | FX
Value + Momentum. Finding asymmetric setups at cycle lows.
My investment letter...

[Value Seeker @ValueSeeker__]

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Oil & Gas: Long-term potential beyond today's events
https://t.co/2t0wrvnJLr…

[Value Seeker @ValueSeeker__]

SUGAR - BREAKOUT & BACKWARDATION

Now trading 22% higher than at the time of the below note, sugar has not only broken out, but is also now in backwardation (seen as a bullish signal).

This doesn't mean, however, that:
• Sugar is a sure win.
• If the bull case happens to be

[Value Seeker @ValueSeeker__]

URANIUM - SLOWLY BUT SURELY

Uranium, below adjusted for money supply, is slowly but surely building up.

Still 78% below its former high, uranium would still need to rise 3.5 fold to reach its former peak.

$U.UN.TO used as a proxy.

$URNM $URNJ

[Value Seeker @ValueSeeker__]

ONGOING RE-TEST FOR MY LARGEST POSITION

After having made a new all-time high for the first time since August 2023, my largest holding (a natural gas producer) is now re-testing its former resistance, in what seems to be a classic technical move.

Meanwhile

$XLE $XOM

[Value Seeker @ValueSeeker__]

ONGOING RE-TEST FOR MY LARGEST POSITION

After having made a new all-time high for the first time since August 2023, my largest holding (a natural gas producer) is now re-testing its former resistance, in what seems to be a classic technical move.

$XLE $XOP #OOTT

[Value Seeker @ValueSeeker__]

IS YOUR PORTFOLIO READY FOR A REGIME CHANGE?

Oil and interest rates are spiking, reviving the fears of the 1970s, while most investors still alive today have never invested in a reflationary world.

Entering a reflationary period would:

Thread 🧵 ↓

#OOTT $VOO $XLE

[Value Seeker @ValueSeeker__]

OIL PRODUCERS: SMALL CAPS > LARGE CAPS

Commodity bull markets often happen this way:

1) The commodity moves first, outperforming producers for a short period of time as investors (cautious after years of underperformance) aren't in
$PSCE & $XLE used as proxies.

#OOTT $XOP

[Value Seeker @ValueSeeker__]

OIL - CRITICAL MOMENT

After 6 volatile months made of ups and downs, oil is now back re-testing its 18-year-old resistance.

If broken, this could officially unleash the upside move oil bulls awaited.

But what's the upside potential?

While in nominal

#OOTT $XLE $XOP $TTE

[Value Seeker @ValueSeeker__]

WEEKEND ARTICLE

EMERGING MARKET CURRENCIES - NOT ALL EQUAL

Poland, Hungary, Brazil, India, China, Korea... From the cheapest to the most expensive currencies.

My latest article: https://t.co/Kcum7T07pU…

$EWZ $EPOL $EEM

[Value Seeker @ValueSeeker__]

DATE BRENT - ANOTHER BACKWARDATION

Dated Brent is now in strong backwardation:

• Front contract (Oct. 26): $112.68
• 2-year-forward contract (Oct. 28): $74.32

In other words, the October 2028 contract is trading at a 34% discount to the current contrac

#OOTT $XLE $USO $XOP

[Value Seeker @ValueSeeker__]

SMALL-CAP FACTOR - LITTLE BREATH, LARGE POTENTIAL

After a 20% rise relative to large caps, small firms are currently taking a breath, as the small-to-large-cap ratio suggests.

Still trading 3 standard deviations below its long-term trend

$IWM $IJS $EWZS

[Value Seeker @ValueSeeker__]

ALUMINUM VS SILVER - PLAYING WITH CYCLES

Exactly 9 months later, the call appeared to be right.

Indeed, while the two metals tend to be correlated over the long-term, leading to this slightly upward trend around which the silver-to-aluminum ratio fluctuates, an 8σ deviation

[Value Seeker @ValueSeeker__]

US DOLLAR DOWN - IMPACT ON US ASSETS

The $DXY remains at a critical level, right on its 15-year-old support.

Breaking it would likely confirm a new bear market, which would not be negative for all US-based assets.

[Value Seeker @ValueSeeker__]

GOLD VS OIL

8 months ago, I alerted about the extreme undervaluation of oil relative to gold.

Fast forward to today, oil has outperformed the yellow metal by 90%, and is still relatively undervalued relative to it.

Indeed, trading still 3.5σ above its long

#OOTT $XLE $XOM

[Value Seeker @ValueSeeker__]

SMALL-CAP ENERGY STOCKS - ADDING NON-ENERGY FACTORS TO THE EQUATION

As implied my latest "Portfolio Movers" article (link in comment below), energy bulls are not limited to choosing between oil, gas, coal, or uranium producers.

Indeed

$XLE used as a proxy for large caps.

[Value Seeker @ValueSeeker__]

OIL - STILL CHEAP

Adjusted for money supply, oil remains in the lower end of its long-term cycle, where its risk-reward is positive.

Indeed, thanks to money printing, oil's 2008 peak at $140 (Brent) would now be equivalent to ~$400.
#OOTT $XLE $USO $OXY

[Value Seeker @ValueSeeker__]

SUGAR - WHEN MOMENTUM MEETS VALUE

Not long after its recent breakout, sugar remains slightly higher than its long-term trend.

Remember that while sugar tends to bottom 1.5 standard deviation below it, it tends to top far above, rendering this trend highly asymmetric
$SB1 $AGRO

[Value Seeker @ValueSeeker__]

PORTFOLIO MOVERS - MAJOR BREAKOUT FOR MY LARGEST POSITION

Discover this week my biggest portfolio position, a small-cap natural gas producer, which just made an all-time high.

Find out:
• My resons for going long.
• The IRR realized so far.

#OOTT $XLE $EWZ $PBR

[Value Seeker @ValueSeeker__]

WHEAT

While wheat is trading right on its long-term trend, don't forget that it tends to drastically overshoot on the upside.

Indeed, while reaching its former bottom level (-1.5σ) would imply a 24% downside move, reaching its former top (+5σ) would generate a +77%.

$WEAT

[Value Seeker @ValueSeeker__]

PETROBRAS

The Brazilian major has now made a proper re-test of its 7-year moving average.

The game is on.

$PBR

[Value Seeker @ValueSeeker__]

OIL - VALUE & MOMENTUM

Oil, adjusted for money supply, remains in the lower end of its long-term cycle, 76% below its former top.

With a monthly MACD regaining strength while China is back as an oil buyer, the recent oil correction may finally be over.

#OOTT $XLE $XOP