Chariot Oil & Gas The 136 per cent advance in Chariot’s share price from December to late March was both powerful and seemingly sustainable, consisting of sharp moves upwards and shallow retreats. But then, in early May, what started as a shallow retreat turned into rout, with the price more than one-third down from its March high of 208p at one point. It became oversold in the process, which raises the prospect of a bounce back towards the 21-day EMA (currently 170.4p and highlighted in yellow).
If Chariot can get back above that line - and even more importantly, its 55-day EMA (170.3p) - I would look for a return to the highs at 208p and 233p thereafter. Given the danger of another summer shakeout in the markets, though, my instinct says that it will probably fail at or before those EMAs, and that the new downtrend will therefore extend further, with the risk of a return to 88.2p. So, a rally ending around those EMAs would persuade me to sell short.
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