Sell Jan23 calls on BP/ LN, TTE FP
Even as the EuroSTOXX50 has soared (14-day RSI 76.9), Brent has dropped into oversold territory (14-day RSI 28.5) on the apparent drop in demand from China. This has produced a short-term value gap between European oil majors and Brent we feel is unsustainable.
In selecting our favourite call sells, we have screened for the following:
1. Upside to consensus price target <20%
2. Jan23 call bid >1% with breakeven around 10% (unlikely to be reached by 20 January in our view)
Click into the note for specifics and indicative pricing.