Sound Oil: Key Support Towards 0.9p Held

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Here are the latest extracts from Zak’s new premium blog AIM Stocks Charting. It stars the likes of Petrel Resources (LSE:PET), Leni Gas And Oil (LSE:LGO) / Gulf Keystone (LSE:GKP) – day in / day out.

Sound Oil (LSE:SOU): Extended Positive Reversal Formation

While as far as the newsflow has been concerned, the autumn has been very positive, it can be seen from the daily chart of the Italian focused oil and gas group that the price action has often not quite matched up to the speculation over the past couple months. Nevertheless from a technical perspective the stock is fulfilling the best expectations in the sense that we are mapping out the right side of an extended head and shoulders formation with its neckline support currently running through 0.9p. The implication of this is that while there is no sustained price action below 0.9p-pre-June support, (and backed up by a July uptrend line in the RSI window, ) we should look be looking for a minimum retest of October resistance through 1.5p over the next 4 to 6 weeks. At this stage it is only sustained price action below 0.8p that would really delay the anticipated upside scenario for Sound Oil.

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