Patterson-UTI Energy, Inc. (NASDAQ:PTEN) gained 2.35% in yesterday’s session, going up from its prior closing price of $20.81 to $21.30, and has now recorded rally in 3 consecutive sessions. Many in the market will be closely watching whether this winning streak is sustainable or take a temporary pause for the next couple of trading sessions. The stock price went upward in 8 of the last 10 days and has generated 10.02% during the last two weeks. The upbeat movement of both volume and price during the recent session is interpreted as a good sign, and, overall 0.33 million more shares exchanged hands compared with prior day. In total, 4.15 M shares exchanged hands for about $88.31 million.
Inside PTEN’s Recent Trend
Patterson-UTI Energy, Inc. (PTEN) has broken the very wide and falling short-term trend up. Initially a lower tendency for declines in the price is indicated and this might very well be an early sign that a trend shift is more likely to happen in the next couple of days. In case of reaction, the stock will see strong support at $21.10, a point that may provide a 2nd chance needed to hit a runner. The next trend top is most likely to be exhibited at $27.15 will be the next possible trendtop level and thereby pose a resistance level which may not be broken on the first attempt.
Patterson-UTI Energy, Inc. Technical Signals
PTEN has witnessed its long term and short term MA triggering a buy signal. Many traders watch for short-term averages to cross above long-term averages to signal the beginning of a uptrend. Upon corrections, the price will meet support from the averages between $20.89 and $18.01. A break down through these support points will trigger sell signals. Its pivot point low generated buy signal on Thursday August 24, 2017, which calls for additional surge until the stock forms a new pivot point high. There was increase in both volume and price. This is usually interpreted as a good sign as traders widely believe rising stock should see increasing volume.
Patterson-UTI Energy, Inc. (NASDAQ:PTEN) Support And Resistance Levels
In case of pullback, the next support the price will capture from accumulated volume will not be far away from current price at $19.75 and $18.66. In case of gains, the next resistance from accumulated volume will not be far away from today’s level at $21.51.
It is important to note, however, that the stock needs to make its way through natural risk while testing a key support level. Once this support is broken, another support level will be to be established at a lower level. Turning back to this stock, Patterson-UTI Energy approaches the first support point just current price at $19.75. In case of a break, the next support we will see from accumulated volume is going to be at $18.66 and $17.00. Accumulated volume is going to prevent the price from rising further at $21.51 and this action will lead the price to take a temporary pause or stay muted for a few days.
Patterson-UTI Energy, Inc. (PTEN) Risk Assessment
A volatility based measure Bollinger Bands suggests this stock poses high risk. In the most recent session, the stock price hovered around $0.54 between high and low, or 2.59%. The average volatility for the past week stood at 2.18%.
The stock is extremely overbought on RSI14 (90). Normally this will pose a good selling opportunity, but since the stock has broken the trend up the chance for a major correction due to high RSI is very small as the stock will find support at the trend broken.