EOG Resources Inc. (EOG) got hit with a number of body blows (ouch) right after I thought it looked attractive to buy on weakness. (EOG Resources and other independent oil producers are the subject of Jim Cramer's opening story this morning.)
As I wrote at the time: "After a seven-month decline, EOG has broken its downtrend and is trying to restart the bull trend. Prices have improved, but I would like to see more volume and a more bullish OBV line before committing to the long side. A pullback to $92, should it occur, is probably a buying opportunity risking below $88."
In just two days EOG pulled back (slumped would be a better description) to $92 and continued lower to $88 -- almost a losing day-trade. Depressing. What do the charts and indicators suggest now is a good strategy? Let's check.
In this updated daily bar chart of EOG, above, we can see how the flat 200-day moving average line acted as a ceiling last week. Prices made a small gap to the downside the other day and broke the flat to slightly rising 50-day moving average line. Prices did not close on their lows yesterday (Thursday), but they closed weak. The daily On-Balance-Volume (OBV) line now shows a fresh decline and tells us that sellers of EOG have been aggressive. The Moving Average Convergence Divergence (MACD) oscillator in the lower panel has crossed to a "take profits sell signal." What profits, you ask?

In this weekly bar chart of EOG, above, we can see how prices stopped at the underside of the flat to declining 40-week moving average line. The weekly OBV line needs today's input, but it looks like it will turn lower. The weekly MACD oscillator in the lower panel looks like a cover-shorts signal will be reversed.
In this Point and Figure chart of EOG, above, we can see how prices have weakened in this month so far. See the "8" on the chart and the column of "O's"? This chart only shows limited support at $87.32 and $86.45. A possible downside price target of $79.97 is projected.
Bottom line: EOG may hold its June lows but the recent rapid sell-off suggests the low could break. Whether EOG declines to its Point and Figure target is not important. What matters now is that EOG probably will need a long period of new base building.