Stock of the day: Total

One of the instruments that has seen the most volatility since the Russian aggression on Ukraine has been oil. This is of course strictly correlated to the movements of oil and gas companies like today’s champion: Total.

Total is in a very interesting place at the moment. It’s getting ready to give us a legitimate trading signal. What we can see on the chart is a big Head and Shoulders pattern (grey). Just like every H&S, we have a neckline here, which is also a long-term uptrend line (green). The breakout of that support would give us a very strong sell signal.

In the same place as the up trendline, we have also a horizontal support – 23.6% Fibonacci, which was already respected at the end of last year (upper yellow). In case the price breaks those two the target would be on the 38,2%, which has been used many times since April 2021.

As for now, it’s a bit too early to claim a bearish victory. Remember, that according to price action rules, you need to see the breakout of the neckline first.