Royal Dutch Shell (RDSB)

 

Royal Dutch Shell and the path to £30

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Royal Dutch Shell and the path to £30

Royal Dutch Shell (LSE:RDSB)

By bettering $55 (marginally), there's a theory Brent crude has enabled a game changing movement and is supposed to be on a cycle to $60 next with secondary, if bettered, at $71.

Of course, how much of this is due to hysteria over recent storms or the usual winter fakery remains to be seen! Perhaps we're placing undue credit on a day high of $55.20, especially as Brent Futures only reached $55.065.

Sometimes, when the Futures market is outstripped by the real market, it can be wise not to fire off party poppers. However, it certainly gives an excuse for an updated look at one of the oil majors, so we've selected Royal Dutch Shell (RDSB) as the test case.

Currently trading around 2,192p, the immediate situation suggests any growth bettering just 2,207p commences a cycle toward an initial 2,339p.

Visually, this even makes some sense, suggesting a challenge against the blue line on the chart, the downtrend for the last three years.

While secondary, if bettered, calculates around the 2,600p level, there's a fly in the ointment at the very deliberate refusal to permit the price above 2,400p.

In keeping with the law of Higher Highs, it makes a massive degree of sense to wait for the share price to actually close above 2,400p before making too many plans for a rosy future where we get to mention 3,000p.

As 'red' on the chart signals, there's been quite an impressive degree of respect paid to the uptrend, and it currently demands the share price break 2,120p before rushing off to change underwear, as this would tick the first box for reversal toward the 2,000p level, perhaps even 1,745p if negative news is involved.

For now, we tend to regard it as heading to 2,339p.

 

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Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.


Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang, Shareprice, or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea. 

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.