Anadarko Petroleum Corp. (APC) was reviewed earlier this month when I wrote that, "Risking below $63 for now, traders could go long APC at current levels and on strength above $71. My longer-term upside price target is $90." APC did not break above $71 but our long recommendation "at current levels" would be stopped out as prices fell below $63. A relatively small loss in the scheme of things but a loss nevertheless. Can prices rebase at this lower level or are we looking vulnerable to further declines ahead? Let's review some updated charts.
In this daily bar chart of APC, below, we can see a number of recent sell signals. Prices broke below the rising 200-day moving average line and the bearish 50-day moving average line. The 50-day line crossed below the 200-day line for a dead cross sell signal. The minor support at the September low was broken and the weakness below $58 is more than halfway through the older $62-$56 support zone from January-early April. The daily On-Balance-Volume (OBV) line shows some weakness from the middle of October and the Moving Average Convergence Divergence (MACD) oscillator is below the zero line now for an outright sell signal.
In this weekly bar chart of APC, below, we can see some sell signals on this longer time frame. Prices have made a close below the cresting 40-week moving average line. The weekly OBV line shows a peak in July and the MACD oscillator is close to crossing below the zero line and generating an outright sell signal.
In this Point and Figure chart of APC, below, we can see a downside price target of $44.72 being projected.
Bottom line strategy: APC needs to rebase and we need to see the OBV line turn up again. If we don't see buyers return the risk is a deeper decline to the $45-$44 area according to the Point and Figure chart.