Is PetroChina ADR Stock Set For A Larger Correction Lower?

by Darius Anucauskas
11:33, 2021/04/08

The current price structure of the PetroChina Company Limited ADR stock (NYSE: PTR) on our daily chart shows that, from around mid-February, the share price is forming somewhat of a head-and-shoulders pattern. The “neckline” is slightly tilted to the upside and could also be seen as a short-term upside support line, drawn from the low of February 16^th. However, even if this proves to be a possible head-and-shoulders pattern, still, the move lower might be seen as a corrective one, as the stock continues to trade above a medium-term upside support line drawn from the low of October 19^th.

If, eventually, the so-called “neckline” of the above-mentioned pattern breaks and the share price drops below the 35-dollar mark, which is the low of March 25^th, that may spook new buyers from entering for a while. PTR could then drift to the low of February 16^th, at 34.00, a break of which might clear the path towards the 32.18 level, marked by the high of February 12^th. Slightly below it runs the aforementioned medium-term upside line, which could provide additional support.

The RSI had recently fallen below 50, although it currently remains flat. The MACD had just dipped below zero and continues to point lower, while running below the trigger line. The oscillators seem to support the idea of the stock moving lower, at least in the near term.

Alternatively, if the previously mentioned “neckline” continues to hold and the share price rises back above the 36.96 barrier, marked by the high of March 30^th, that could invite more buyers into the arena. The stock would already be placed above all of its EMAs, which might add more positivity into the near-term outlook. PTR may then drift to the 37.78 hurdle, a break of which could open the door for a move to the 39.66 area, marked by the high of March 15^th.

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