BP and annoying email offers

I keep getting emails that have the tag line "Last chance to buy BP at$##.##".

Of course the whole email is a marketing ploy to get me to sign up for some service or other that is based around this individual's television personality...no not Cramer, but a similar name. Funny thing is that the price to buy BP keeps getting lower and lower each time. What a load. I think it started around $36 and change.

Rather than rant about any of this I thought I might take a quick look at the technicals for BP...given the Gulf crisis I think that the foreseeable future looks pretty bleak for the stock prices.

Here is a monthly chart that covers the stock since listing. I noted three major monthly support and resistance levels and some of the important periods that the price was playing near these levels. Note the next support level is around the old $20 mark... it has a bit of a ways to go but if I were even considering trading BP I would be shorting it heavily... in fact had I been watching it at all I would have just bought some 55 strike July or August puts back when the price was toying with $62.50 as it is an old resistance level from 1999. But that would not have been the only reason although this would have been pre-gulf disaster time so that was not a factor at all, it has just been a huge catalyst.



Taking this down to a weekly chart I left the same S/R lines and added a rising wedge trend. I started using the Aroon indicator lately as it shows trends as they establish. I am not familiar with how it does this as I am with other indicators and oscillators but it seems to work. I'll get around to the math some other time.

Meanwhile, the downtrend was indicated as established late March while the price was approaching the retest just over $60. Given that the resistance and moving averages were converging it was a nice setup to short or buy a put.

Looking at the price move through the lower red resistance line I would have to say that resistance at this point is next to nothing.

Looking at the daily chart it is plain to see the day things turned nasty. The rig explosion took place on April 20th and everything that followed just added to the mayhem.

The green support is about $21 and is the next possible stop for the price...depending on what happens in the gulf and some government actions. I would still consider getting in on this railroad ride but I have all of my trading capital allocated right now and I would rather not over extend myself.

I wonder when they are going to stop trying to call the bottom. Best is to trade it when it appears.

Jeff.