Apache Corp. (NYSE:APA) — This independent energy company, which explores for, develops and produces natural gas, crude oil and natural gas liquids, has been in a bear market since August, when it broke down from its 200-day moving average at $120.
On Oct. 5, with the stock at $79, the Trade of the Day recommended buying APA following a positive signal from our proprietary indicator, the Collins-Bollinger Reversal (CBR), for a trade to $90.
The trade was successful and the stock is now recommended for a longer-term move higher following the break from a base at its 50-day moving average (blue line).
Chesapeake Energy (NYSE:CHK) announced yesterday that it will cut natural gas production by 8%, which should result in higher gas prices that would benefit APA.
Initially the stock should trade up to its 200-day moving average at over $105, but S&P has a “five-star strong buy” on APA with a 12-month target of $145.
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