Rosneft shares may rise to resistance at 538 rubles in the next few days
On Monday, the securities managed to reach the local growth targets and reached the 531.4 level. It failed to pass the resistance level of 532. Then quotations rolled back to the support level 518 and consolidated above it. The technical picture shows that the buyers are trying to grow in the coming days to the important resistance level on the weekly chart, 538. A break-up of the 532-538 area is important to determine the end of the medium-term correction that started at the end of March.
If the price can reach 538, it might not be able to break it at the first attempt. Then a pullback to the 532 level on the daily chart would be organic.
As long as the securities do not consolidate above the 532 boundary, the road is open for trading in the 500-532 range. The lower boundary of the range is the main target of the correction and is interesting for building up long positions. At the same time, the long-term growth scenario is not fulfilled. After the end of the corrective waves there is a high probability of resumption of the uptrend with renewal of the 2021 highs.
What to do? For open medium-term long positions, the first benchmark for selling is in the 590-595 zone. Intermediate-term hurdles are 532 and 538. The upside targets will change as the upside moves and the length of momentum breaks important resistance levels.
On the 4-hour chart RSI curve is located in the neutral zone at 41 p. The RSI indicator does not show any divergence with the chart. Technical indicators point to the reserve for the growth of quotations. However, the first thing to watch out for is the fixation of the price on the daily chart above or below the boundaries: 532 and 508 to determine the further movement scenario.
The external background this morning is moderately positive. Futures are up 0.1%. Asian indices are trading mainly in the green zone. on the upside by 0.3%. Rosneft opens trading slightly above Monday's closing level.
Rosneft is the first oil company whose shares returned to the levels seen before the February-March sell-off. Since the November 2020 lows, Rosneft quotes have climbed to 69%.
The formed movement has reached the medium-term growth targets in the 548-560 area. There is still a global growth target at 620-650.
Last week's candlestick closed below 535, which means it might continue the correction to the weekly support levels of 500-510, and then the uptrend will continue (you cannot ignore the break-down of 535).
If the weekly candlestick rises above the 538 mark, it is expected to resume rising toward those targets.
In the long term picture, you have to look at the weekly candle close at the end of Friday's trading.