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On-Fire ONEOK Set to Surpass All-Time High Amidst 30% Surge

Last Updated September 23, 2020 12:59 PM
Kiril Nikolaev
Last Updated September 23, 2020 12:59 PM

ONEOK (OKE) has been in a strong uptrend ever since it posted lows of $18.84 in December 2015. During this bullish rampage, the stock managed to print an all-time high of $71.99 in July 2018. Since then, the bulls have been struggling to take the stock to greater heights.

David Blair  noticed OKE’s inability to convert resistance of $70 into support.

While some traders are bearish on OKE, we are taking the contrarian stance. It is possible that ONEOK could take out the resistance and print a fresh all-time high.

ONEOK (OKE) Flashing Multiple Bullish Patterns

It is true that buying shares at resistance levels is not a wise investment strategy. However, this principle should be reconsidered once the stock forms higher lows while consolidating near the resistance. This tells us that bulls are preparing for a big push.

We’re seeing these signs develop in OKE.

OKE stock chart
OKE printing a bullish continuation pattern | Source: TradingView

The weekly chart reveals that OKE is painting an inverse head-and-shoulders pattern. This structure indicates that the bulls are using higher lows to push the price up and breach the neckline of $70.

While bulls have been unsuccessful in convincingly piercing the resistance, we believe that it could be only a matter of time before they do. The supply area of $70 has been tapped multiple times over the last year. This suggests that the resistance is nearly drained.

Also, a look at the longer timeframe reveals a larger bullish formation.

ONEOK chart
OKE forming a large bullish pattern on the monthly chart | Source: TradingView

The monthly chart shows that the security is brewing a large cup and handle pattern. Thus, a convincing breach of the $70 resistance will likely attract investors who are currently staying on the sidelines.

Analyst: Sees ‘$104 as the Next Reasonable Target’

In addition, Ian McMillan, CMT , an analyst in the RIA industry, shared his stance on CCN.com. He said:

“Although energy has been a horrible space to be in for the last few years, recently select MLPs have held up pretty decently and ONEOK (OKE) happens to be one of them. From a technical perspective, we are currently sitting below resistance around the $72 area, going back to 2014. If we were to break above this level, and hold, I think you could look at $104 as the next reasonable target on the upside.”

OKE chart by Ian
ONEOK chart provided by Ian McMillan

This is our case for why ONEOK is threatening to breach its all-time high.

Disclaimer: This article is intended for informational purposes only and should not be taken as investment advice.