A curious divergence is taking place on the chart of ExxonMobil, as the stock's performance decouples from the recent rise in oil prices. While oil has been steadily climbing, the chart of ExxonMobil tells a different story, with the stock underperforming and struggling to maintain momentum.
In the second half of December, ExxonMobil attempted to ride the bullish wave of rising oil prices but ultimately failed to sustain a significant upswing. A critical technical level is the blue horizontal resistance at $108, which has repeatedly held firm. Twice, the price managed to breach this resistance, but both attempts ended with shooting star candlesticks, a bearish reversal signal, marked on the chart with orange. These shooting stars signal that sellers are firmly in control at this level, creating a negative outlook for the stock.
As long as the price remains below the $108 resistance, the sentiment for ExxonMobil remains bearish, indicating a greater likelihood of further downside. A breakout and daily close above this level, accompanied by a strong bullish candle, could shift the sentiment and provide a signal to buy. However, given the current setup and the repeated failures at this resistance, the chances of a bullish breakout appear limited.
ExxonMobil traders should watch the $108 level closely, as it holds the key to determining the next move.