Ascent Resources: Extended base could stretch towards 2p

I have to say that despite being a fan of Ascent Resources (LON:AST), it felt as if the company was a little too rough a ride. However, for the bulls at least it may be that things are finally entering calmer waters.

Ascent Resources has not been a stock for widows or orphans. Indeed, at various points it may be argued that it was the masochists who really would have triumphed. June served up an exhaustion gap reversal, while for August there was an as yet unfilled gap to the upside above the 50 day moving average – usually one of the more robust bullish technical signals.

What can be said now is that there has been a decent sideways consolidation of the early August move, with support coming in just below the top of the gap at 1.05p. This leads us to conclude that provided there is no break back below this number on a sustained basis we should be treated to further progress within a rising trend channel now based at the 200 day moving average at 1.16p.

The target for Ascent Resources while the 2016 price channel floor remains intact is seen as being the summer price channel top as high as 2.20p over the next 2-3 months. Clearly the latest news from the Slovenia environmental agency will underpin this situation at least initially.