Crescent Point Energy (CPG) is trying to bottom, with dips below $11 being bought in the past 18 months. A price of $10.50 is acting as support on a Point and Figure chart, but the trend is still down with prices trading below the declining 50-day and 200-day moving averages.
Let's drill down on the charts and indicators to see if this energy name can stage a turnaround to the upside.
In this daily chart of CPG, above, we can see a pattern of lower lows and lower highs from June. Both the shorter-term 50-day moving average and the longer-term 200-day moving average have negative or bearish slopes. The pace of volume looks like it has been heavier since November compared to earlier. The On-Balance (OBV) line was in a bearish trend from May to November and told us that sellers were more aggressive.
Since November, the OBV line has moved up the price action and, maybe more interesting, it has not moved lower the past two months as prices weakened. In the lower panel is the 12-day momentum study, which is slowing a bullish divergence versus the price action. The slower pace of the price declines could mean traders have been buying more CPG on weakness and a recovery rally could be coming.
In this weekly chart of CPG, above, we can see prices have been in a broad sideways pattern since August 2015. Prices are below the declining 40-week moving average line and the weekly OBV line is neutral. The Moving Average Convergence Divergence (MACD) oscillator is below the zero line in bearish territory.
In this Point and Figure chart of CPG, above, we can see a multiyear downtrend but near-term prices have held the $10.50 level twice. That may continue to hold but a rally to $13 is needed to improve the chart picture.
Bottom line: CPG looks like it is poised to rally with a bullish divergence from the momentum study and the OBV line not weakening with the price action recently. Aggressive traders could buy CPG here risking a close below $10 or on strength and a close above $13.