Beach Energy is a $3 billion oil and gas exploration company operating across Australia and New Zealand.
“Oil prices are back down near $60, and everyone’s concerned about there not being enough demand to lift prices higher,” Michael said.
“It provides investors with a great mean-reversion trade right now.
“Supply is showing signs of tapering off in the US and global demand numbers are slowly being reassessed upwards.
“This can lift the price of oil back into the $70’s and therefore energy stocks like BPT. “Shorter-term, at least, the share price is showing signs of heading higher again.
“After bouncing strongly earlier this month, BPT then started to trade sideways (see the circled area in the chart) on lower volumes to consolidate the move.
“This was a bullish sign as it was just a matter of time until the stock was ready for the next stage of the rally.
“The past couple of days has seen BPT finally break out of this consolidation, and this means that we now have a buy signal, and the stock should run towards the recent highs near $1.50,” Michael said.
Beach Energy (BPT)
