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Technical Analyst Sees Signs of Upside Breakout on Small-Cap Oil & Gas Firm
Source: Clive Maund for Streetwise Reports
March 14, 2019 (Investorideas.com Newswire) Technical analyst Clive Maund explains why he expects this company's shares to break out.
BNK Petroleum Inc. (BKX:TSX; BNKPF:OTCQX) has put in a disappointing performance since we went for it about a month ago - it has refused to break out of its downtrend and has instead dropped to a new low, although not by much, but the good news is that buying on huge volume has started to kick in, which we can see on its latest 3-month chart below. In particular there were two up days on huge volume at the start of this month that, together with the curious high volume day in the middle of February that looks like a "cross trade" give rise to the suspicion that something is going on here-it looks like some powerful buyer is taking a position-and it is definitely worth noting here that there has been a big volume buildup in the US traded stock since the start of the year, with the On-balance Volume line surging in recent weeks, and the chart for this market, shown lower down the page, has been added later after the close of trading on Monday 11th.
This action is viewed as greatly increasing the chances that the upside breakout that we have been looking for is going to occur soon.
On the 1-year chart you can see why we are expecting an upside breakout soon-the large bullish Falling Wedge shown on this chart is now closing up with downside momentum dropping out, as shown by the MACD indicator. Thus, the strange very high volume upside days in recent weeks, especially in the US traded stock, are viewed as evidence that someone-or something-is taking positions at good prices ahead of some as yet unknown development. The oil price looks set to rise short-term which is a supporting factor.
The chart for the U.S. traded stock has just been added after the close of trading on the Monday 11th, the reason being that it shows persistent accumulation from the start of the year that has driven the On-balance Volume line steeply higher in recent weeks. This is a strong indication that it is basing here and readying to break out upside, probably soon.
Also added after the close on Monday 11th is this link to a news release by the company at 8.24 ET ANNOUNCING A 26% BOE INCREASE IN 2018 YEAR-END PROVED RESERVES .
We therefore stay long and fresh purchases are in order here with a stop at say C$0.238, in case it disappoints and steps lower again.
BNK Petroleum website .
BNK Petroleum Inc, BKX.TSX, BNKPF on OTC, closed at C$0.265, $0.192 on 8th March 2019.
1) Clive Maund: I, or members of my immediate household or family, own shares of the following companies mentioned in this article: None. I personally am, or members of my immediate household or family are, paid by the following companies mentioned in this article: None. My company has a financial relationship with the following companies mentioned in this article: None. CliveMaund.com disclosures below. I determined which companies would be included in this article based on my research and understanding of the sector.
2) The following companies mentioned in this article are billboard sponsors of Streetwise Reports: BNK Petroleum. Click here for important disclosures about sponsor fees. As of the date of this article, an affiliate of Streetwise Reports has a consulting relationship with BNK Petroleum. Please click here for more information.
3) Statements and opinions expressed are the opinions of the author and not of Streetwise Reports or its officers. The author is wholly responsible for the validity of the statements. The author was not paid by Streetwise Reports for this article. Streetwise Reports was not paid by the author to publish or syndicate this article. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article until three business days after the publication of the interview or article. The foregoing prohibition does not apply to articles that in substance only restate previously published company releases. As of the date of this article, officers and/or employees of Streetwise Reports LLC (including members of their household) own securities of BNK Petroleum, a company mentioned in this article.
Charts provided by the author.
The above represents the opinion and analysis of Mr Maund, based on data available to him, at the time of writing. Mr. Maund's opinions are his own, and are not a recommendation or an offer to buy or sell securities. Mr. Maund is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations mentioned in his reports. As trading and investing in any financial markets may involve serious risk of loss, Mr. Maund recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications. Although a qualified and experienced stock market analyst, Clive Maund is not a Registered Securities Advisor. Therefore Mr. Maund's opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction.
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