88 Energy: Break of 3p could lead towards 5p

1 mins. to read
88 Energy: Break of 3p could lead towards 5p

88 Energy (LON:88E) has been and remains something of a stock market darling amongst private investors. It would appear that we are approaching the next stage in the company’s share price progression.

Recent newsflow regarding 88 Energy centres on the onshore Alaska explorer’s 270,000 acre acquisition, and in particular the Icewine-2 drilling programme. This started last month, and it can be seen from the daily chart that the shale oil group’s shares have started to edge higher.

Once again we have edged up towards the key 3p resistance level, a barrier which has been in place not only in recent weeks, but over the whole of the post-October period. The normal charting rule is that the longer a barrier remains in place, the greater the log jam break effect is when it finally gives way.This would make sense in the case of 88 Energy given the way backing a potential clearance of 3p this month is an uptrend line in the RSI window, a leading indicator on price breakouts, as well as the rising 20, 50 and 200 day moving averages.

All of this goes to suggest that as little as a weekly close above 3p either tomorrow or next week could be enough to drag the share price to the top of a rising August trend channel at 5p over the following 1-2 months. Only back below the 200 day line now at 2.45p would really delay the upside scenario.

88E chart

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