Coronavirus crash: how low can the BP and Tullow Oil share prices go?
Last week, the two oil and gas companies saw their shares take a significant tumble, with the coronavirus bringing about a major sell-off in global equities and, with a wider decline in oil prices the pair could fall further.
Over the last seven trading sessions, BP and Tullow Oil have seen their shares fall by 5% and 9% respectively, with the pair succumbing to investor panic derived from the COVID-19 outbreak that brought about major sell-off in global equities last week.
This week, the pair have seen their stocks claw back some of their losses, but with oil prices in decline, with Brent crude trading at $52 a barrel after falling to $49 last week, down 16%, investors will likely take a bearish view towards BP and Tullow Oil that could see their share prices fall further.
BP and Tullow Oil closed at 414p and 32p respectively on Tuesday.
BP: technical analysis
BP shares hit the lowest level since mid-2017 last week, with the wider decline in oil prices hurting the stock, according to Joshua Mahony, senior market analyst at IG.
That decline took price through a confluence of trendline and horizontal support around £4.52. That level also provided the completion of a bearish double top formation following a three-year rally that saw the stock gain 121% since the February 2016 low.
While price is on the rise this week, we are likely seeing a retracement of the recent decline, with further downside expected before long. With that in mind, a bearish outlook is in play despite the current bounce, with a rise through £4.81 required to negate this view.
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Tullow Oil: technical analysis
Tullow Oil declines have been consistent since the mid-November breakdown, with the stock hitting fresh lows last week, Mahony said.
‘There is little reason to expect the tide to turn given the lack of any bullish signals,’ he added. ‘As such, a bearish outlook remains in play, with trendline resistance likely to continue depressing price for the foreseeable future.’
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