Cenovus Energy Inc. - (CVE.TO) - November 7, 2023
Ending a three-month stay and a six month run of increasing relative performance, Cenovus Energy (CVE.TO) tumbled out of the green zone within the SIA S&P/TSX 60 Index Report and dropped back into the Yellow Neutral Zone after falling 7 spots yesterday to 18th place.
There are a number of other Canadian energy names which remain more highly ranked in the Green Favored Zone of the same report, have higher SMAX scores and/or are on positive point and figure patterns. These include: Canadian Natural Resources (CNQ.TO), Tourmaline Oil (TOU.TO) and Suncor Energy (SU.TO). For the last eighteen months, Cenovus Energy (CVE.TO) has been swinging back and forth in a sideways range between $19.50 and $30.25. After trending downward through the first half of this year, Cenovus staged a summer rally but this now appears to have faltered with the shares turning back downward once again.
Last month, the shares snapped an uptrend line and in the last few days, they have been falling in price on rising volumes, a sign of distribution and increasing selling pressure. A close below $26.00 initial support would confirm the start of a new downswing with next potential support near $24.75, then the $21.00 to $32.00 area. Initial resistance on a bounce appears near $28.50.
Since June of 2022, Cenovus Energy (CVE.TO) has been trending sideways in a range more or less between $20.00 and $30.00. Back in the summer, the shares swung up within this range and by September were looking like they were setting up for a breakout with a double top and a bullish catapult.
That was as far as CVE.TO got, however, ending in a bearish Bull Trap one-row breakout, and then rolling down into a column of Os and then staging a bearish Double Bottom Breakdown.
Initial downside support appears at previous column lows near $22.35, followed by $20.25 based on a horizontal count, then $20.00 round number and the September 2022 low near $19.45. Initial resistance on a bounce appears near $28.35 based on a 3-box reversal and a previous column high, then the top of the current range near $30.10.
With a bearish SMAX score of 5, CVE.TO is exhibiting weakness against the asset classes.
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