BP Is Still in a Bull Trend, but Can It Convince the Naysayers?

BP (BP)  ADRs show a pattern of higher lows the past 12 months (see the daily chart), but it needs a new high to bring the bulls back in strength. An examination of the charts and indicators will show you what I mean.

In this daily chart of BP, below, we can see the higher lows since April with the most recent higher low in March. BP made a high in July and a higher high in early January. Since July BP has been above the rising 200-day moving average line but it slipped below that indicator in February. This month BP has traded above and below the 200-day line and it will not take much of a rally to take the price of BP back above the 200-day again.

The On-Balance-Volume (OBV) line has been rising since early August and supports a bullish outlook. The Moving Average Convergence Divergence (MACD) oscillator gave a cover shorts buy signal at the end of February and just crossed above the zero line for an outright go long signal.

In this weekly chart of BP, below, we can see that prices are right on the slightly rising 40-week moving average line. The weekly OBV line is still pointed up and the MACD oscillator looks close to a fresh go long signal.

In this long-term Point and Figure chart, below, we can see that BP is in a down column (Os) and it will take a rally to $39 to be a double-top breakout and open the way for a longer-term rally to $53.

Bottom line: A close below $33 would weaken the charts of BP and that is what I would risk. Closes above $36 and $39 would strengthen the charts and put the bulls in control again.

Employees of TheStreet are restricted from trading individual securities.