Suncor Energy Inc. declined from $47.27 to $23.97 (A-B), rallied to $37.28 (C) and then settled in a bullish technical pattern known as a "W" formation (dashed lines). The rise to $36.76 (D) signalled the breakout above the midpoint of this pattern; however, Suncor was overbought at that time, so it traded in a narrow range between $35 and $38 (dotted lines) until the 40-week moving average had time to catch up to the price. The recent rise to $40.03 confirmed the resumption of the right arm of the "W" pattern (E). Only a decline below $36 would be negative.
Point & Figure measurements provide targets of $44 and $49. Higher targets are visible.
Monica Rizk is the senior technical analyst for Phases & Cycles Inc. (www.phases-cycles.com). Ron Meisels is a contributor to the www.NA-marketletter.com website and Tweets at @Ronsbriefs. They may hold shares in companies profiled. Please see the site for a glossary.