Phat squiggly lines: Pontificate Pilot


Pilot Energy (ASX.PGY) is a leader in the clean energy transition, leveraging existing oil and gas assets to move into the renewables sector. Existing infrastructure will be employed, in consortium with industry leaders, to provide wind and solar farms, Blue Hydrogen technology and Carbon Capture Storage operations. Global renewable energy is expected to be a $2 trillion industry by 2030, up from $881 billion in 2020, with the Asia-pacific region accounting for more than half of global energy consumption. 

Market overview

After falling by 11% in January, the ASX 200 (XJO.ASX) has had a strong recovery over the past two weeks and has now rallied around 5% since the low reached last month. The market feels like it’s a bit on edge at the moment, with several macro headwinds contributing to recent market volatility. With Russia on the brink of invading Ukraine, rising interest rates smashing tech stocks, and inflation readings not seen in decades, it’s no wonder the market is so temperamental at the moment – a theme we see sticking around for the better part of this year.

From a technical standpoint, the market has recovered strongly since it entered a correction in January, but is now at a strong resistance level around 7,200. It’s a bit difficult to see what catalysts there may be in the near term to push the market higher, but then again, analysts were saying that during COVID and it proceeded to rally more than 30% from the low point reached in March 2020.

We believe now is the time to be an active investor and to be selective with what stocks you add going forward. Having a solid trading plan in place especially for scalping or short-term trading can improve results and reduce losses, so traders are encouraged to stick to their trading rules and strategies.

  1. Short-term resistance in place around recent high of 7,325
 2. Recent low and support at 6,800
 3. Recent high around 7,620

Stocks to watch

Woodside Petroleum (WPL.ASX)

  1. Retest of 12 month high and current resistance
 2. Initial target of $30 or next level of resistance

Woodside Petroleum is one Australia’s top-tier oil and gas producers based out of Western Australia. The stock has had a great start to 2022 rallying more than 23% year to date and is looking to retest highs not seen since January 2021.

From a technical standpoint, the stock is now at strong resistance but with the momentum oil has off the back of unrest in Europe, it wouldn’t surprise to see a break of this level in the near term and a push back up towards $30 or approximately 11% higher. We’d be inclined to wait for confirmation of the break before taking a position as pre-empting the move can often result in the initial view not coming into fruition.

Pilot Energy (PGY.ASX)

  1. Short-term resistance
 2. Initial profit target of $0.06
 3. Medium-term target

We touched on Pilot Energy a couple of weeks ago and the stock has since pulled back somewhat but is still trading within the range. From a technical standpoint, the stock has reached short-term resistance but looks likely to push through in the near term and retest recent highs of around $0.062 or approximately 15% higher. If it can manage a strong close today on decent volume, $0.06 looks like the logical next stop before reassessing to see where too from there. Over the medium term we believe a retest of the recent high of $0.09 will eventuate, but this may take some time.

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Phat squiggly lines is where pro traders get a technical take on the stock markets – with Kieran Neeson, Opentrader's in-house trading guru.

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