Oceaneering International (OII) has rallied strongly in recent weeks, enough of a rally to make a meaningful improvement on the longer-term charts and indicators. (For more on the energy sector see Jim Cramer's thoughts here.) Let's investigate further.
In this daily bar chart of OII, below, we can see repeated tests of the $18 area form late October. All of these tests now look like buying opportunities. Prices have rallied strongly since early April. Crossing above the now rising 50-day moving average line and this month above the flattening 200-day line. The 50-day average is close to crossing above the 200-day line for a possible golden cross. The daily On-Balance-Volume (OBV) line made a low in November and has slowly improved since that date. A rising OBV line tells me that buyers of OII have been more aggressive for months. The trend-following Moving Average Convergence Divergence (MACD) oscillator moved above the zero line in early April for an outright go long signal.
In this weekly bar chart of OII, below, we can see that the stock price has made a long decline but also that things are improving. Prices are above the flattening 40-week moving average line. The weekly OBV line has been very strong this year and now the MACD is crossing the zero line for a buy signal on this weekly time frame.
In this Point and Figure chart of OII, below, we can see that prices have reached an upside price target of $23.50 but more gains look possible.
Bottom line: OII has broken above its January high and now is pushing up into resistance from August to October of 2017. Traders should approach OII from the long side. Consider going long at current levels and on strength above $27.
