BP PLC-SPONS ADR is setting up nicely for a breakout.

A possible breakout setup was detected on BP PLC-SPONS ADR (NYSE:BP) by our stockscreener. A breakout pattern is formed when a stock consolidates after a strong rise up. We note that this pattern is detected purely based on technical analysis and whether the breakout actually materializes remains to be seen. It could be interesting to keep an eye on NYSE:BP.

Deciphering the Technical Picture of NYSE:BP

At ChartMill, a crucial aspect of their analysis is the assignment of a Technical Rating to each stock. This rating, ranging from 0 to 10, is calculated daily by considering numerous technical indicators and properties.

Taking everything into account, BP scores 7 out of 10 in our technical rating. This is due to a decent performance in both the short and medium term time frames. Compared to the overall market, BP is only an average performer.

• The long term trend is positive and the short term trend is neutral. The long term trend gets the benefit of the doubt for now.
• When comparing the performance of all stocks over the past year, BP turns out to be only a medium performer in the overall market: it outperformed 60% of all stocks.
• BP is currently trading in the middle of its 52 week range. The S&P500 Index however is trading in the upper part of its 52 week range, so BP is lagging the market slightly.

For an up to date full technical analysis you can check the technical report of BP

How do we evaluate the setup for NYSE:BP?

Next to the Technical Rating, the Setup Rating of a stock determines to which extend the stock is consolidating. This score also ranges from 0 to 10 and is updated daily. The setup score evaluates various short term technical indicators. For NYSE:BP this score is currently 8:

Besides having an excellent technical rating, BP also presents a decent setup pattern. We see reduced volatility while prices have been consolidating in the most recent period. A pullback is taking place, which may present a nice opportunity for an entry. There is a support zone below the current price at 37.80, a Stop Loss order could be placed below this zone.

How can NYSE:BP be traded?

For a potential trade one would typically wait until the stock breaks out of the consolidation zone to enter the stock and it could be sold again for a loss when it would fall back below the zone.

This article should in no way be interpreted as trading advice. You should always make your own analysis and trade or not trade based on your own observations and style. The article is based purely on some technical observations.

More breakout setups can be found in our Breakout screener.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.