This is what it will take for Shell's shares to recover
13th December 2018 10:20
by Alistair Strang from Trends and Targets
In the past month, oil prices have taken a nose dive, which explains a sharp drop in Shell’s share price. Time for chartist Alistair Strang to take a look at the key price points.
Shell (LSE:RDSB)
In the month since we last reviewed Shell, the price has gone to the dark side. Not only did it achieve our drop target at 2,279p, it closed a crucial 4p below target. From our big picture perspective, this is not a good thing.
Despite presently trading around 2,350p, we've little choice but to expect future weakness below 2,275p to bring travel down to an initial 2,167p.
We do anticipate some sort of short-lived bounce if (when) such a level is achieved. In the event 2,167p breaks, bottom for a real rebound still calculates at 2,097p. Or at least, this would be our hope.
Unfortunately, in the event of everything hitting the fan, quite strong reversal down to 1,580p remains very possible, thanks to the share illustrating a continuing series of lower lows since it broke trend in November.
Quite surprisingly, the share does not need to work terribly hard to suggest a coming escape attempt from its doom.
At present, the situation demands movement above 2,388p prove capable of 2,444p next. In itself, a fairly lacklustre attempt but above 2,444p allows us to present 2,538p as a viable recovery position.
For now, we fear 2,167p shall prove the secret plan and visually, there is certainly a reasonable excuse for a rebound at such a level. Hopefully it does not break.
Source: Trends and Targets Past performance is not a guide to future performance
Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.
Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea.
These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.