National Oilwell Varco, Inc. designs, manufactures, and sells
equipment and components used in oil and gas drilling, completion, and
production; and provides oilfield services to the upstream oil and gas
industry worldwide. The company’s Rig Systems segment offers land rigs;
offshore drilling equipment packages; and drilling rig components. Its
Rig Aftermarket segment offers spare parts; and repair and rental
services, as well as technical support, field and first well support,
field engineering, and customer training services. The company’s
Wellbore Technologies segment designs, manufactures, rents, and sells
various equipment and technologies used to perform drilling operations.
Its Completion and Production Solutions segment offers equipment and
technologies for hydraulic fracture stimulation.
Take a look at the 1-year chart of National (NYSE: NOV) below with added notations:
After the stock’s yearly decline, NOV has now started trading
sideways over the most recent three months. While in that sideways move,
the stock has formed a common pattern known as a rectangle. A minimum
of (2) successful tests of the support and (2) successful tests of the
resistance will give you the pattern.
NOV’s rectangle pattern has formed a resistance at $42.50 (red), and a
$35 support (green). At some point the stock will have to break one of
the two levels.
The Tale of the Tape: NOV is trading within a
rectangle pattern. The possible long positions on the stock would be
either on a pullback to $35 or on a breakout above $42.50. The ideal
short opportunity would be on a break below $42.50.
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