Stock of the day: Royal Dutch Shell

In today’s analysis, let’s look at the Royal Dutch Shell, listed on the London Stock Exchange. We did mention this instrument before, not in the ‘Stock of the Day’ series but in our video: ‘Coffee and CFD Talks’ on the 24^th of August. On that day, we saw this instrument inside of the symmetric triangle, waiting for a breakout.

Did the breakout happen? No, but there are other interesting price movements that I’d like to share with you. A breakout almost happened on Thursday. In trading, almost is not enough. Almost means that the price made an attempt to break the upper line of the triangle but failed miserably. Instead of a breakout, we got a bounce and a shooting star candlestick. The price bounced not only from the upper line of the triangle but also from the horizontal resistance of 14.8 GBP, created by the highs from August.

That bounce is a definite sell signal also considering the general sentiment on the market, which after the Evergrande situation is let’s delicately say; very negative. All that together allows us to think that there’s a sell signal Shell and that the price should aim for the lower line of this pattern really soon.