Hello, everyone, it’s Stephen Whiteside here from theUpTrend.com. And in this weekend’s presentation, we’re going to take a look at the energy stocks listed on the Stockhouse . Now, the reason I’m doing this presentation today is it looks like we may be setting up for some new short term opportunities in the Energy Sector. Now, the TSX closed at a new all time high on Friday, and we’re coming up to our next mathematical price target of 22,500. Now, the Venture Exchange has been on quite a run since the fall lows, and we are looking at a weekly chart of the venture exchange. Now, we are coming up to resistance. We are coming up into the Flypaper Channel. The venture exchange has been in a bear market since early 2022. Is that about to change? Well, we are coming up to our mathematical price target of 625. You can see that back in early 2023, we made a high, then a lower high, another lower high, and then we finally broke down. So we could be coming up to a wall of resistance or a nice wall of opportunity. If we can get through 625 on a weekly basis, then the 2023 high would be our next price target.
Looking at the Energy sector itself, about six weeks ago, we generated an early warning signal up at the top of the screen, and we’ve been meandering ever since. We have certainly generated a lot of daily short term sell signals, but not a lot of weekly sell signals in the Energy Sector. Looking at a daily chart of the TSX Energy index, you can see we’re just treading water here. We traded up to the upper channel line on Friday, still need a higher close on Tuesday to give us a new daily buy signal for the Energy Sector itself. Now, one of the reasons that I’ve come back to focus on the Energy Sector is that crude oil ended Friday on a daily buy signal. So we haven’t been on a buy signal for a month or so. And crude oil is now joining natural gas, already on a daily buy signal, up another 3.8% on Friday. So both of those moving higher could help bring money back into the Canadian Energy Sector. Now, looking at the Stockhouse Bullboards, we currently provide coverage for four out of the six stocks on this list, starting off with BTE.TO Baytex Energy. And we’ll be looking at weekly and daily charts through the rest of the presentation.
Baytek looking pretty weak right now, but it actually recovered going into the close. So it closed just above the lower channel line. We needed to close below 4.68, and we actually closed at 4.75. So just above the lower channel line. So we’re still on a weekly buy signal here. During the week, we drove all the way down to our next price target, which was $4.49. We got as low as $4.50 before completely reversing and coming back to the $4.69 level. So we’re coming into Tuesday’s trading action. Remember, Monday, the markets are closed in Canada. We need to close above $4.93 on Tuesday. Now, of course, if that doesn’t happen on Tuesday, that upper channel is going to continue to move lower daily. Then, looking at a weekly chart of TVE.TO Tamarack Valley Energy, we’ve traded down to the lower channel line for the last three weeks, but we’re still on a buy signal here. We need to close on Friday. Below 3.60, we closed at 3.69, and so we’re still on a weekly buy signal. Looking at the daily Flypaper Channel chart for Tamarack, you can see that we’re still holding the Flypaper Channel. So the bulls are still in control here.
They’ve just taken a break for the last couple of weeks and now we’re looking to see if they want to add to their positions. The first sign of that happening would be a close on Tuesday above $3.78. Then looking at ATH.TO Athabasca Oil , third week of a weekly sell signal here, we had an inside week this week and we were up just a little over half a percent on the weekend. Again, looking at the daily Flypaper Channel chart, we’re still holding the channel, so the bulls are still in control. If we look at the price action since the middle of February, we’ve been in a range moving up to 547, trading slightly above it and down to $4.69, trading slightly below it. So about 98% of all the trading activity since the middle of February has been between this range. Now, notice right now, the middle of that range is acting as resistance. It’d be a nice tell if we could get up and over the 5.08 level once again, and that should take us back up to at least the 5.47 level. We are coming into Tuesday’s trading action on a buy signal that would change on Tuesday with a close below $4.80. Then, looking at VLE.TO Valeura Energy, looking at a weekly chart here, you can see the early warning signal on the Panic Zone chart.
And then we’ve come down. We can see that we’ve traded in the channel this week. We’ve come down to the lower channel line, but did not close below it. We needed to close below 4.74. We closed at 4.92. So no sell signal there on the daily Flypaper Channel chart. You can see we just came down to the top of the Flypaper Channel. So the bulls are still in control. Looking at a daily chart, things would change on Tuesday with a close above $5.38. Now, whether you’re looking at the daily or weekly panic zone charts, they’re all projecting lower prices for most of the stocks in the Energy Sector. And it’s certainly true. We’re projecting a lower price here. There’s an open gap at the top from back here. That could certainly be a target than the previous low here. That could certainly be a legitimate target. So, yeah, we’re projecting lower prices here, but projections don’t know what they don’t know. And when new things come along, like a buy signal in crude oil on Friday, that can certainly change the outcome of a projection, and the stock market can change its mind at any time.
Projections are interesting. They give you realistic expectations of what could happen and when it could happen. But then again, it doesn’t know what it doesn’t know. And that’s one of the most important lessons of the stock market, is we don’t know what we don’t know yet. Let’s finish off looking at the elephant in the room when it comes to the Canadian Energy Sector, and that is CNQ.TO Canadian Natural Resources. Looking at the weekly panic zone chart, you can see we are projecting lower prices here. But right now we’re still up at the top of the Panic Zones. We’ve had a couple early warning signals go off, but not a lot of pullback. Once this stock got over $100, it looks like the market wants to keep it up there to get a new weekly sell signal. We need to close this coming Friday below $100.25. We haven’t even got to the Flypaper Channel yet on the way down. So the market is still loving this stock. The 50 day moving average is holding us in check at the moment. We came down towards the $100 level a couple of weeks ago, did not get there. So money is available at $100 to hold this stock up.
Now, talking about ranges, we’ve got up to 100, 1250, we got down near $100. And so mathematically, the midpoint is 106.25. And you can see that that once we broke down below, it is now acting as resistance. So it’ll be quite a tell if we can start breaking out above 106.25. To generate a new buy signal on Tuesday, we need to close above $105.20. Now, this could be a bullish sign. It hasn’t been confirmed yet, but you know, we put in a higher low on Wednesday. If we could put in a higher high this coming week, that would be very bullish and that would at least get us back up to the previous highs from April. Okay, folks, that is all for this presentation. The main reason that I’m here speaking to you today about the Energy Sector is the fact that Friday we ended the day on a new daily buy signal for crude oil. If that continues this week, that could certainly bring money back into the Canadian Energy Sector. And we’ve certainly been sitting on the sidelines for a while now. Now, I’m always bugging you to donate blood and I hit number six this week.
If you’re a blood donor, please remember we do have a blood donor rewards program on our website. We give discounts. In fact, we’ve given a lot of free memberships away, lifetime memberships, to people who have been donating blood for quite a while. So we like to reward people for doing that. And yeah, I hit number 60 this week. If you really want to rack up your numbers, just decide to donate plasma. You can basically do that every week and really rack up your numbers quickly. Okay, folks, that’s all for this weekend’s presentation. Enjoy the rest of your long weekend. I will be back on Monday morning. The US markets are open on Monday. And then of course, the Canadian markets will be back on Tuesday again. Enjoy your wonderful weekend and we’ll talk to you again soon.
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XEG.TO iShares TSX Energy
BTE.TO Baytex Energy
TVE.TO Tamarack Valley Energy
ATH.TO Athabasca Oil
VLE.TO Valeura Energy
CNQ.TO Canadian Natural Resources
Stephen Whiteside
TheUpTrend.com
Sunday, May 19, 2024
