An analyst upgrade of Occidental Petroleum (OXY) got my attention Thursday so I felt the need to check on the charts and indicators.
We last reviewed
the charts of OXY on September 14 and wrote that "Some investors may be shying away from stocks like OXY but if there is a successful trade to be made we should consider it. Aggressive traders could go long OXY at current levels risking to $21.50. $32 and then $47 are our price targets."
Let's check and see how this recommendation has fared.
In this updated daily bar chart of OXY, below, we can see that prices rallied from when we recommended going long. A short-term peak was made in late October and then prices corrected lower into late November/early December. This pullback is a higher low and appears to be a successful test of the rising 200-day moving average line.
The On-Balance-Volume (OBV) line has moved sideways since March but shows a slight decline from November. A fresh rise in the OBV line would be a welcomed development.
The Moving Average Convergence Divergence (MACD) oscillator is crossing to the upside for a cover shorts buy signal.
In this weekly Japanese candlestick chart of OXY, below, we can see that prices are holding just above the rising 40-week moving average line. The OBV line is steady after a decline in October and November. The MACD oscillator is above the zero line in this time frame.
In this daily Point and Figure chart of OXY, below, we can see a nearby upside price target in the $35 area.
In this weekly Point and Figure chart of OXY, below, we used close only price data. Here the software is projecting a price target in the $55 area.
Bottom line strategy: Continue to hold longs recommended in September. If you took some profits at $32, our first price target, that is fine. Traders could rebuy OXY at current levels. Raise stops to $26 from $21.50. Our new targets are $35, then $47, followed by $55.
Get an email alert each time I write an article for Real Money. Click the "+Follow" next to my byline to this article.