Skip to main content

The Globe and Mail

Suncor Energy stock enters period of seasonal strength


What are your thoughts on Suncor? I am very intrigued by the current price per share versus its 52-week high. Any thoughts would be very much appreciated!

Thanks, Darryl

Story continues below advertisement

Hey Darryl,

I last ran the charts for Suncor Energy Inc. on Nov. 19, 2010. The assignment came from Ed and at the time the stock was trading for $33.59. It was suggested that the shares were building a base and that the stock was coming into its period of seasonal strength. In addition it was advised that $32.00 would be a good entry point.

My mentor Steve Kalil taught me that the bigger the base the better the case for an investment. Once a stock breaks out above of its base, and building resistance, there is money to be made. In this case that is exactly what happened. However, this was not buy-and-hold investment but a case of capturing profits when available.

An examination of the charts will help inform the opportunities and risks associated with SU.

The three-year chart tells the tale of a stock that built a base in 2010 and ran from $32.50 in late November to a high of $47.50 by March of 2011. A sweet 46.15 per cent return in four months. But that was all that the shares had to give.

From the March high SU proceeded to shred capital all the way to $23.97. Ouch! That has to hurt! Once again an object lesson in capturing profits when available and not getting married to a story.

The MACD and RSI have both generated some nice buy and sell signals over the last six months. At this moment the RSI is moving into overbought territory and the MACD seems to be flattening out. The big test going forward is resistance along the 200-day moving average. If it gets and stays above that level then there is hope for a further advance.

Story continues below advertisement

With energy stocks entering a period of seasonal strength that will run until May, it's a good time to make a move if you are so inclined. Just remember that the trend is your friend till it ends!

Make it a profitable day and happy capitalism!

Have your own question for Lou? Send it in to

Visit his website

Report an error
About the Author
Lou Schizas

Lou Schizas is an equities analyst, investor, entrepreneur, professor and television and radio personality - and a true believer in the happiness-inspiring powers of capitalism. More

Comments are closed

We have closed comments on this story for legal reasons. For more information on our commenting policies and how our community-based moderation works, please read our Community Guidelines and our Terms and Conditions.

Combined Shape Created with Sketch.

Combined Shape Created with Sketch.

Thank you!

You are now subscribed to the newsletter at

You can unsubscribe from this newsletter or Globe promotions at any time by clicking the link at the bottom of the newsletter, or by emailing us at