ConocoPhillips Has a Strong Chart, Aims Higher

 | Apr 18, 2017 | 2:51 PM EDT
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ConocoPhillips  (COP) is showing a stronger chart picture than other energy names I have looked at recently.

Let's check the latest charts and indicators to see what is different on COP.

In this daily bar chart of COP going back 12 months, above, we can see a strong rally from September to December followed by a three-month correction before prices gapped to the upside in late March. Prices were below the 50-day and 200-day moving averages in March, but the upside gap quickly reversed that condition. The On-Balance-Volume (OBV) line did move up with the price action from October, but it turns more neutral since December. The Moving Average Convergence Divergence (MACD) oscillator crossed to a cover-shorts buy signal in late March and then an outright go-long signal in April when it moved above the zero line.

In this weekly chart of COP, above, we can see prices are back above the rising 40-week moving average line after a dip below it. The weekly OBV line was bullish from its early 2016 low but it has been neutral since December. The MACD oscillator turned bullish in November when it moved above the zero line. The MACD oscillator is still bullish and looks poised to turn up again.

In this Point and Figure chart of COP, above, we can see a decline from 2014 and the reversal to the upside the past year. A rally to $53 on this chart will be a double breakout and turn the chart more bullish should it occur.

Bottom line: COP has been trading in a tight range following its upside gap a couple of weeks ago. It looks like COP wants to move higher, but I would wait for the strength before jumping in. Traders could buy COP on a close above $51 and add on a close above $53. A close back below $47.50 would be what I would risk.

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