I last looked at Cabot Oil & Gas (COG) in July, where I said, "COG looks strong enough now to recommend the long side. My upside price targets are $26.75, followed by the $28-$30 area." Now that prices have traded into our target area a fresh look is warranted.
In this daily bar chart of COG, below, we can see a pattern of higher lows and higher highs until this month. COG has yet to make a higher high to maintain the uptrend. Prices have been trading above and below the flat 50-day moving average line. The 200-day line is rising and below the market. The daily On-Balance-Volume (OBV) line bottomed in May/June and has been moving up but here too a new high for the OBV line would help. The trend-following Moving Average Convergence Divergence (MACD) oscillator is currently hugging the zero line and needs to turn higher.
In this weekly bar chart, below, we can see that prices are above the rising 40-week moving average line. The weekly OBV line has been rising for two years. The MACD oscillator has been above the zero line since June and is bullish.
In this Point and Figure chart of COG, below, we can see that a trade at $29.52 will be a fresh upside breakout and should open the way to further gains.
Bottom line -- longs can continue to hold risking a close below $26 now. Add on strength above $29.50 looking for gains to $34 next.
