What is interesting about the UK Oil & Gas (*LON:UKOG) daily chart since the beginning of November is the way that even as long ago as that time the technicals were starting to point to the latest recovery for the shares. This is because there was bearish divergence in the wake in the RSI window after the much lower support for the stock in November versus October, following the sharp autumn declines not only for this stock but for almost all of the major plays in this sector.
What was perhaps most surprisingly is the way that despite the relative stability going into the turn of the year UK Oil & Gas needed to build an extended base generally between the 0.4p and 0.5p area, a zone which ties in with the present level of the 50 day moving average at 04p.
This is also the notional floor of a wide rising trend channel from September, a feature which could come into play in terms of rehabilitating the stock later this year. In the meantime technical trade is to be following the latest break through 0.5p, with an end of day close stop loss back below the 50 day line. The initial target over the next 4 to 6 weeks is seen as being the 200 day moving average at 0.8p. But only above this feature on a weekly close basis would suggest a full recovery of last year’s best levels towards 1.8p was on its way in the near-term.
