An October 15 Update on the Exxon Mobil XOM Triangle

I’ve been watching the long-term triangle consolidation pattern in Exxon-Mobil for some time now, including the post “Symmetrical Triangle in XOM” and “Update on the Triangle in XOM“.  Now that we have a change in the triangle - a potential upward breakout - let’s revisit this stock on the weekly and daily frames.

The weekly chart shows us the long-term triangle (almost two years in the making now) and the upwards price breakout that occurred this week.

Price broke above the $70 per share boundary, which gave a quick ’scalp’ entry (to play for a quick range expansion play), and now price is challenging overhead resistance on the weekly frame as shown above.

The levels to watch include $73.00, which coincide with the 200 week SMA at $72.85 and the upper weekly Bollinger Band at $73.45.

Though not shown, the 50% Fibonacci retracement from the high to the low rests near $73.50.

Prior price resistance from the June 2009 price high exists near $74.50.

All of these will be levels either to play for, or watch to see if buyers can continue to push prices beyond them.  There is little to no overhead resistance above $75.00 (until price hits the $80 area) so the pathway from $75 to $80 would be known as “open air.”

Taking a look at the daily chart, we see nothing overhead (moving averages are all beneath price currently) except the prior price highs at $71.89 and $72.35 which reflect the August and July 2009 price highs.

Keep watching these levels closely and look for signs (especially intraday) of continuation to the upside to these levels.

This could be a nasty bull trap, but there’s no way to know that in advance other than to keep a close watch on your positions and intraday structure going forward.

Corey Rosenbloom, CMT
Afraid to Trade.com

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