Will CHESAPEAKE ENERGY CORP breakout?

A possible breakout setup was detected on CHESAPEAKE ENERGY CORP (NASDAQ:CHK) 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 NASDAQ:CHK.

What is the technical picture of NASDAQ:CHK telling us.

ChartMill assigns a proprietary Technical Rating to each stock. The score is computed daily by evaluating various technical indicators and properties. The score ranges from 0 to 10.

We assign a technical rating of 8 out of 10 to CHK. This is due to a consistent performance in both the short and longer term time frames. Also compared to the overall market, CHK is showing a nice and steady performance.

• The long term trend is positive and the short term trend is neutral. The long term trend may just continue or reversal may be around the corner!
• Looking at the yearly performance, CHK did better than 96% of all other stocks. On top of that, CHK also shows a nice and consistent pattern of rising prices.
• CHK is one of the better performing stocks in the Oil, Gas & Consumable Fuels industry, it outperforms 73% of 389 stocks in the same industry.
• CHK is currently trading in the upper part of its 52 week range. The market is still in the middle of its 52 week range, so CHK slightly outperforms the market at the moment.
• In the last month CHK has a been trading in the 94.04 - 107.31 range, which is quite wide. It is currently trading in the middle of this range, so some resistance may be found above.
• Volume is considerably higher in the last couple of days.

Why is NASDAQ:CHK a setup?

ChartMill also assign a Setup Rating to every stock. With this score it is determined to what extend the stock has been trading in a range in the recent days and weeks. This score also ranges from 0 to 10 and is updated daily. The setup score evaluates various short term technical indicators. NASDAQ:CHK scores a 9 out of 10:

Besides having an excellent technical rating, CHK also presents a decent setup pattern. We see reduced volatility while prices have been consolidating in the most recent period. There is a resistance zone just above the current price starting at 103.66. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 103.15, a Stop Loss order could be placed below this zone. Another positive sign is the recent Pocket Pivot signal.

How to trade NASDAQ:CHK?

A breakout could materialize when the stock breaks out to new highs above the current consolidation zone. One could wait for this to happen and buy when this happens. A stop loss could be placed below the consolidation zone.

Of course, there are many ways to trade or not trade NASDAQ:CHK and this article should in no way be interpreted as trading advice. The article is purely based on an automated technical analysis and just points out the technical observations. Always make your own analysis and trade at your own responsibility.

More breakout setups can be found in our Breakout analyzer.