GEOS Trading opportnuity
Oil and Gas continues to languish near the bottom of investor sentiment in what is a crowded Pairs trade being long Tech and Semi-Conductors and Short oil. The first signs of an unwinding occurred with a major buy signal on Conoco (COP) on Friday s shown on the chart below, which prompted a look elsewhere for other opportunities.and GEOS presenting itself.
One that has hit our radar this week is GEOS GeoSpace Technologies, which is the process of building a classic Base formation. A glance at the Fundamentals shows that whilst it is loss making, its sales growth in the past year has been impressive, especially in such a challenging environment for the industry.
Short Interest in a stock that has gone nowhere for months is also very high at 45 days.
However, whilst these are nice knows the real interest is the Technical Picture. When Base Building we are watching for time to catch up with price and the Time Area study does this. The line of interest is the purple one which is the Quarterly. Currently at 16.23 it will drop to 15.56 at the end of June. This will mean that all time frames up to quarterly will be below price and creating a zone of support. It will also leave space for a rally to 19.08 which is where the Semi annual will be and 20.36 annual target. This creates a timing point for trend being able to begin next month for GEOS.
Peak Expansion creates true measure of support and resistance with an emphasis on the weekly and monthly levels place on a daily chart. Monthly Blue line support has moved to the bottom of the trend re-enforcing support. Therefore it has been placed on our watch list for a breakout higher, a trade safely buy signal to materialize or a timing point next month to appear.
Please note this is general advice from Trading Safely for all our clients and has been prepared without taking into account your personal objectives, financial situation or needs. If you do wish to consider acting on our information please contact a licensed financial advisor to discuss the appropriateness of this recommendation for your own personal financial circumstances. Please obtain any relevant product disclosure documents before deciding to invest. Trading derivatives, stocks and CFDs can lead to losses greater than your deposit.