Range Resources (RRL): Improving Chance Of Sustainable 4p Break - But Don't Jump The Gun

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Here are the latest extracts from Zak’s new premium blog AIM Stocks Charting

It stars the likes of Chariot Oil & Gas (LSE:CHAR) / Gulf Keystone (LSE:GKP) and Xcite Energy (XEL).

Range Resources (LSE:RRL): 3p – 4p Wedge Pattern

Range Resources remains one of the most speculative and speculated situations around in terms of companies of any shape and size, not just on AIM. The most interesting aspect here in recent months has been the way that although the stock may have its detractors on a fundamental basis, the charting position is of slow rehabilitation in recent months. The recent for the positivity however cautious is the way that on the daily chart we can see a falling wedge (bullish) pattern between the 3p and 4p levels. The way that the price action has been contained between these two numbers in the recent past does of course back the idea that the stock is delivering a recovery. Nevertheless, it has to be admitted that the trigger for a sustained improvement would most likely be an end of day close above 4p, and ideally an end of week close above this figure before the bulls can finally say that they have a credible change of prevailing. In the meantime traders could be buyers on weakness, but would have to be aware that there could still be another pullback to test 3p yet again, an experience which in percentage terms alone could be described as being painful to say the least.

That said, if we do get our buy trigger in the form of sustained price action above 4p it can be anticipated that there will be a relatively sharp spike to the upside, a large move which could see the shares traveling from 4p to 5p in as little as a couple of session, such is the logjam to be broken here after such an extended period of confinement. At this stage targeting the 200 day moving average at 5.2p seems fair on the proviso of 4p giving way before the end of February.

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