Thursday, November 17, 2011

CVX (Chevron Corporation) at 100.96 Potential Double Top Pattern Underpins Further Downside (SELL)

CVX extended the decline off the record high at 110.01 (27 Oct) to probe the key support zone of 100.58/100.79/100.74, stalling at 100.74 (16 Nov low). A clean break of the key 100.74/100.79 support levels is needed to confirm the double top formation at 110.01/109.00 highs. A downside break there would allow bears to seek 96.25 (Support 1). Clearance below would risk an extension towards 92.72, near the projected double top target at 91.57 (Support 2) ahead of the key 86.68 reaction low (Support 3) for a retest.

It would take strength above 103.42 to delay bears. However, only above 107.33 (Resistance 1) would negate and shift focus higher towards 109.00 (Resistance 2) which guards 110.01 (Resistance 3).

Trading Indication:
Short-term: Sell at 102.50 or higher;
Target at 92.72 and lower;
Stop Loss at 103.50 (1.0%)
Long-term: Possibly buy lower

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