Here’s why ConocoPhillips is surging (January 8)

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ConocoPhillips Surges 5.09% Today

Highlights

The U.S. government told ConocoPhillips it must invest in Venezuela's oil sector to recover approximately $12 billion in expropriation claims after anticipated political changes.
ConocoPhillips is cautiously evaluating participation in reviving Venezuela’s oil industry, citing ongoing legal and financial risk concerns.
ConocoPhillips reported a potential significant gas discovery in Australia's Otway Basin and raised its dividend to $0.84 per share.

Venezuelan claims and Otway gas find shape sentiment amid legal caution

The U.S. government recently informed ConocoPhillips that recovering its approximately $12 billion in Venezuelan expropriation claims would require new investments in the country's oil sector following political changes there. The company is also evaluating its participation in reviving Venezuela’s oil industry, though it remains cautious about legal and financial risks. Additionally, ConocoPhillips reported a possible significant gas discovery in the Otway Basin, off western Victoria, Australia, and continued its policy of increased dividends with a recent payment raised to $0.84 per share.

Anton Kharitonov, expert at Traders Union, notes that ConocoPhillips is trading firmly above its key moving averages, but he remains skeptical of the sustainability of the recent upward move. The short-term momentum, while bullish, is contradicted by overbought intraday oscillators and weak follow-through signals in Stoch RSI and CCI. He points out that the news from Venezuela introduces significant legal and financial uncertainty. Kharitonov also warns that the low probability of further upside and mixed momentum suggest caution for late buyers. "In my view, the potential for a near-term pullback outweighs the chance of another sustained rally at these levels."

Viktoras Karapetjanc, expert at Traders Union, sees the technical setup as solid, with the bullish structure of ConocoPhillips clearly intact above all major averages. He highlights positive sentiment supported by strong price action and a recent dividend increase, viewing the strategic moves in Venezuela and the potential Australian gas discovery as future growth drivers. Karapetjanc believes the market offers multiple opportunities as buyers dominate near session highs. "I expect further growth as the stock consolidates above $100 — the bullish momentum and fresh catalysts point to an optimistic outlook in the coming days."

Jainam Mehta, market strategist, notes ConocoPhillips' strong technical momentum alongside rising volatility. He sees the divergence in short-term overbought signals as a window for tactical range trade setups, with consolidation likely between $101.42 and $102.32. "Watch for a potential breakout above $102.32 — but be prepared for a fast fade if bearish momentum surfaces below support."

Overbought conditions emerge as bullish momentum meets technical resistance

The nearest dynamic support based on Ichimoku's Kijun is at $95.78, while resistance is likely at the next round level near $100. Momentum indicators on the daily chart show MACD and ADX in bullish alignment, indicating strong upward traction. RSI sits at 51.38, confirming buyer dominance, while daily Stoch RSI and CCI are mixed and suggest pockets of oversold and neutral conditions, respectively. BBP and intraday oscillators signal overbought conditions, with buyers clearly dominating momentum. The Awesome Oscillator also points up, supporting the trend. While momentum and oscillators mostly confirm the aggressive move, some divergence appears in short-term overbought signals, warranting caution for late entries.

Previously it was reported that COP traded below its short- and long-term moving averages, with only the MA-50 offering limited technical support as immediate and longer-term selling pressure persisted. Oscillator signals, including a bearish RSI and oversold Stoch RSI, indicated weak momentum while price action was forecast to remain range-bound amid a tight volatility band and sellers dominating the session — all suggesting that further declines or sideways trading are the most likely scenarios unless resistance above $91.71 is breached.

Source of Data: COP Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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