On Sunday evening, Benzinga asked its followers on Twitter (NYSE:TWTR) what they’re buying at the open on Monday. From the replies Benzinga selected one ticker for technical analysis.
@trading_junkie_, @Allstartrading1n and @chamo_miller are buying Camber Energy, Inc (NYSE: CEI).
Camber Energy was trading up about 23% in the premarket compared to the United States Oil Fund (NYSE: NYSE:USO), which was trading about 1.9% higher.
Since reaching a high of $4.85 on Sept. 29, Camber Energy has traded in a long-term downtrend, until Feb. 23, when the stock reversed course. Like many stocks in the oil and energy sector, Camber Energy was boosted when news hit that Russia had invaded Ukraine, although the stock had flashed indications on its chart an uptrend was in the cards.
Camber Energy is also a good candidate for a short squeeze due to its underlying statistics. The stock has a float of 250 million shares of which 25.5 million shares, meaning 10.6% are held short. Although the number of shares held short has decreased from 34.06% in January, the number is still high enough to cause a short squeeze under the right circumstances.
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The Camber Energy Chart: On Feb. 22 and Feb. 23, Camber Energy tested the 45-cent mark as support and held above the level, which created a bullish double bottom pattern on the daily chart. The stock then reacted to the pattern and big bullish volume came in causing Camber Energy to rally 25%.
The following trading day, on Feb. 24, Camber Energy gapped up 36% and ran another 23% intraday, where the stock rejected the $1 level. The stock then entered into a five-day period of consolidation within a falling channel pattern and then on Friday broke up bullishly and soared 33% higher off the open.
On Friday, Camber Energy printed a massive bullish engulfing candlestick on the daily chart, which indicated higher prices were likely to come on Monday. On Monday, the stock was looking to gap up higher but eventually, another period of consolidation will be needed to cool Camber Energy’s relative strength index, which is measuring in at over 60%.
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- Bulls want to see Camber Energy come down to fill the gap left behind at the market open on Monday quickly, and then for big bullish volume to come in and push Camber Energy up above the important psychological resistant level at $1. Camber Energy resistance above the level at $1.19.
- Bears want to see big bearish volume come in drop Camber Energy back into the falling channel pattern and then for the stock to continue trading in a downtrend until it loses support at the 45-cent mark, which could put Camber Energy in danger of revisiting its all-week low of 33 cents. Below the level there is no further support in terms of price history.
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