False break of support of 5000 rubles in Lukoil shares gives hope for the growth soon
Bidding results
On the previous trading day Lukoil shares grew by 0.58%, closing was at 5023 rubles. The paper looked at the level of the market, having added 1.01%. The volume of trading in the stock on the main market amounted to 7.8 bln rubles, while the average monthly volume was 8.1 bln rubles. Average daily range for 5 days is 250 minimum steps.
Short-term picture
On Wednesday, Lukoil quotations managed to recover above 5,000 rubles and spent most of the session in the previous day's trading range of 5,000-5,200 rubles. The price is trading around the 50-period average, which is looking sideways and indicates the prospects of sideways consolidation. At the same time, a false break of the 5,000-ruble support gives hope for a quick rise. With the sentiment warming, a rebound to the area of 5200 rubles with the prospect of a break-up upward is likely.
The medium-term view on the stock is moderately positive. As oil market conditions improve, the stock may return to growth and head towards a nine-month high near 5,550 rubles.
- Nearest support levels: 5000 / 4800 / 4600
- Nearest resistance levels: 5200 / 5400 / 5500
External Background
The external background in the morning is mixed. U.S. indices declined after closing the main session on the Moscow Exchange. Asian indices are trading multidirectional. Futures on S&P 500 grows by 0.01%. Brent oil today in the plus by 0.5%. All it gives the grounds to assume, that at preservation of a background the opening will pass near level of closing of the previous trading day.
Long term picture
At the beginning of the year, the three-year uptrend was reversed. On the 2020 horizon, if market conditions improve, shares could recover to the area of 5,500 rubles. It is difficult to expect more significant growth so far, as risks inherent to the global oil market remain high. At the same time, in 2021 we could well see a return above RUB 6000 per share.
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