Cenovus Energy Inc. - (CVE.TO) - August 20, 2024

At SIACharts, we compare head-to-head battles of thousands of stocks, commodities, mutual funds, and exchange-traded funds daily and rank them by relative strength based on who is winning the most in their respective universes. The top 25% of investments are in the Green Favored Zone, 26-50% make up the Yellow Neutral Zone, and the bottom half of each investment report is considered the Red Unfavored Zone. Back in the spring of this year, we reported on energy producer Cenovus Energy (CVE.TO) as it marched its way back up the relative strength rankings in the SIA S&P/TSX 60 Index Report. CVE.TO had just cleared the $29.00 hurdle for the first time since 2022 and was closing in on the $30.00 round number to confirm a massive breakout with resistance dating back to 2010. As we enter fall, we can see that Cenovus did not have the power to break through long-term resistance and fell back into its trading range. Shares of CVE.TO also fell down the relative strength matrix, now firmly camped out in the Unfavored Red Zone of the SIA S&P/TSX 60 Index Matrix Report at position #44. Recent trading in the $26 level shows CVE.TO near the top of the trading range that is in place between $19 and $29. Volume is also light on this low relative strength energy name as the chartists observe a shooting star on the weekly candlestick chart. A shooting star candlestick pattern is a bearish reversal signal characterized by a small body at the lower end of the price range, a long upper shadow, and little to no lower shadow, indicating a potential reversal from an uptrend to a downtrend.

The attached Point and Figure Chart is very large, and the numbers can be a challenge to read, so let us detail them here. The point of the exercise is to observe the actual support and resistance lines that date back to 2010. Top-line resistance is now to the penny, with the top line at $29.55, which will serve as the most important number to keep in mind. A break above this level would indicate the continuation of the Cenovus Growth story, and SIA practitioners could automate this by adding an alert to their platform to know when the game is back on. Other resistance levels appear at $28.79 and $28.23. Also note the price discovery triangle that is being established on the chart, with breakouts in either direction being important dates for practitioners. To the downside, the level of $24.57 would confirm a bearish triangle, with support then at $19.76, $19.00, and $17.55. With its Bearish SMAX score (which is a near-term 1 to 90-day indicator comparing an asset against different equal-weight asset classes) of 4 out of 10, CVE.TO is exhibiting minimal short-term strength against the asset classes.

Disclaimer: SIACharts Inc. specifically represents that it does not give investment advice or advocate the purchase or sale of any security or investment whatsoever. This information has been prepared without regard to any particular investors investment objectives, financial situation, and needs. None of the information contained in this document constitutes an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind. As such, advisors and their clients should not act on any recommendation (express or implied) or information in this report without obtaining specific advice in relation to their accounts and should not rely on information herein as the primary basis for their investment decisions. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. SIACharts Inc. nor its third party content providers make any representations or warranties or take any responsibility as to the accuracy or completeness of any recommendation or information contained herein and shall not be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon. Any statements nonfactual in nature constitute only current opinions, which are subject to change without notice.

Keep up to date on the latest financial market news.

Receive a daily newsletter with stock highlights, ETF rankings, weekly market focus and others.