Camber Energy Is Headed Higher After 'Massive Rally': Here Are The Signs

On Thursday evening, Benzinga asked its followers on Twitter what stock they’re most focused on to end the week. From the replies, Benzinga selected one ticker for technical analysis.

Twitter follower @gamma8Flip responded with Camber Energy Inc. CEI, which increased 15% on Thursday and was “starting to pick up some buzz on the chat forums.”

Indeed, the energy sector had a bullish day on Thursday, with Exxon Mobil Corp. XOM rallying 2.3% to close the session at 94.38. Light Crude Oil Futures CL closed yesterday's session up 3.67%.

On Friday, CL1 was consolidating lower, printing an inside bar pattern on the daily chart, which may indicate a consolidation day is in store for many stocks in the energy sector.

Camber Energy could also be gaining steam due to its psychological relationship to a number of meme stocks, which have been surging lately. The Houston-based company has undergone a number of short-squeezes since January 2021, with one 86% 1-day squeeze taking place on Jan. 28 — the same day GameStop Corp. GME topped out at $120.75.

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The Camber Energy Chart: Camber Energy’s massive rally on Thursday helped the stock to confirm a new uptrend:

• The higher low in the uptrend was printed on Aug. 16 at 35 cents
• The most recent high was formed at the $0.369 mark on Aug. 12.
• On Thursday, Camber Energy soared up above the former higher high, negating the downtrend
• That same day, Camber Energy found resistance at the 50-day simple moving average (SMA)
• It closed the trading session on the level. Bullish traders want to see the stock regain that area as support, to indicate longer-term sentiment has turned bullish.

In the premarket on Friday, Camber Energy was trading lower. The stock may print an inside bar on Friday to consolidate Thursday’s rally, which would be healthy. If that happens, traders can watch for Camber Energy to break up from Thursday’s mother bar later on Friday or on Monday.

Eventually, Camber Energy will need to retrace to the downside to print a higher low. Traders not looking for a short-squeeze would prefer for the stock to move upwards at a slower pace to avoid a volume climax and blow-off-top taking place.

Camber Energy has resistance above at 45 cents and the 58-cent level and support below at 34 cents and the 30-cent mark.

See Also: CNBC's Final Trades: 4 Energy Plays With The Biggest Upside