Since our previous post on Exxon Mobil, it has increased significantly in value against our expectations. Unfortunately, with the upcoming earnings, the stock might get an additional boost in price, which is already hovering near all-time highs. As a result, XOM breaking above $114.66 will force us to abandon our price target on the downside. However, even if a breakout occurs, we will continue to pay close attention to subsequent price action and monitor volume very closely. To support the idea of a fakeout, we would like to see a continual drop in volume accompanying price growth on the daily chart (just like on the monthly chart). As for the outlook beyond the short-term, we remain worried that ranging oil prices between $70 and $85 per barrel will threaten the well-being of this stock title. Furthermore, higher taxes on energy companies, economic slowdown, and oil down more than 35% since its 2022 peak will put pressure on further price increases.
Illustration 1.01
Illustration 1.01 shows the hourly chart of XOM. The yellow arrow points to a technical glitch at NYSE, which saw multiple stock companies plunge and turn on circuit breakers. We can potentially discard this movement.
Illustration 1.02
Illustration 1.02 displays the monthly chart of XOM. The red arrow indicates a continual decline in volume, which is a bearish technical development.
Illustration 1.03
Illustration 1.03 shows the daily chart of XOM and the updated setup.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
Illustration 1.01
Illustration 1.02
Illustration 1.03
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.
Comment:
To abandon the price target of $90, we want to see the price close above the resistance today.
Trade closed manually:
We will continue to observe the price action; the setup remains valid in the case of retracement.
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