Chart of the Day: Tapering won’t derail bullish price action on Beach Energy
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Sometimes the view from the bottom of the lake has its appeal.
Energy prices are trending higher, and the last three days – in what has been a volatile market – speak to the possibilities of a change in fortunes at the company now known as Beach Energy (ASX:BPT).
There’s a break of that downtrend that we can talk to, complemented by two strong closes before today with closes on highs, no gap in between those first two days, and reasonable volume.
Over the last month, BPT has traded $394m worth of value.
That’s something we care about in this environment, as it means we can’t get stuck unless we choose to ignore stops.
We are currently long from 110c, and will need to see the stock close at 100c or below before getting shaken out of our position.
On the upside, we would like to see the break of the downtrend as shown with the black trend lines hold, which would target a gap fill back to 120c from the 13 th of August – it got to and closed at 118c today.
After that, it’s 140c as horizontal resistance.
Beyond there, the larger gap on the chart is entirely evident, and would be exciting territory given the amount of space into which the price could operate.
To be clear, the low on the 29th April before the big dump was 167.5c, so that would be the next target.
The world is tapering in more ways that one, but that doesn’t mean the price action won’t guide us on BPT, and right now that price action is bullish.
Steve Collette of Collette Capital Pty Ltd (ABN 56645766507) is a Corporate Authorised Representative (No. 1284431) of Sanlam Private Wealth (AFS License No. 337927), which only provides general advice.
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