Over two weeks since Oracle Power announced a deal that would allow it to open a powerplant, its stock struggles to find bids in the market. Oracle Power share price is currently down by over 15% at 0.820 as risk aversion dominates market sentiment.
In February, the coal developer announced that it made a deal with China National Coal Development and Dubai’s Sheikh Ahmed bin Saeed Al Maktoum. The consortium will develop a coal mine and powerplant in the Sidh Province of Pakistan. Consequently, the Oracle Power Share Price rose by 67.41% following the news.
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However, with coronavirus fears and the oil price war unfolding, the stock has given up almost all of its gains. The outbreak has over 110,000 cases and 3,000 deaths worldwide. Meanwhile, the breakdown of the OPEC+ alliance has led Saudi Arabia to hike its oil production which will dampen crude oil price.
On the weekly chart, it can be seen that Oracle Power share price has found support at the 100 SMA at 0.660. This area, also seems to coincides with the 61.8% Fib level (when you draw the Fibonacci retracement tool from the low of November 4, 2019 to the high of December 16, 2019). The recent reversal candles could indicate that buyers in the market are getting ready to push price higher. Near-term resistance is at 1.6350. This level offers a confluence of resistance with the 200 SMA and falling trend line (from connecting the highs of September 12, 2016, June 12, 2017, and September 11, 2017) aligning at this price.
On the other hand, a strong bearish close below the consolidation could mean that Oracle Power share price still has room to trade lower. If support at January 2020 lows at 0.630 breaks, we could see the stock fall to its November 2019 lows at 0.190.