Petro Matad (AIM: MATD) share price is maintaining its bearish outlook despite a market-wide recovery. The penny stock had been experiencing very high volatility, which suggests many short-term traders are trading it. However, technical analysis on a higher timeframe reveals a much clearer picture.
On Tuesday, Petron Matad shares plummeted by 2.47%. On a weekly timeframe, this translated into a 5.07% drop from last week’s close. The negative price action comes at a time when equities are showing a strong recovery after a downtrend in August.
Petro Matad is an oil exploration company that focuses on the development and production of crude oil in the central Asian country, Mongolia. The company is listed on the Alternative Investment Market (AIM), which is the sub-market of the London Stock Exchange (LSE). AIM is the international market for small and medium-sized companies.
At the time of writing, Petro Matad share price is trading at 3.56p, which is 50% below its yearly peak of 7.1p. This puts the Mongolian oil exploration firm at a market capitalization of only $39.68 million. Such a tiny valuation makes it prone to massive volatility spikes, which is evident from its chart.
As visible on the following AIM: MATD chart, the price has been trading inside the 2.55p-4.90p range for the past 2 years. The price has broken above this range multiple times during this time but the bulls couldn’t gain momentum.
After another rejection from the range high in August, Petro Matad share price forecast has flipped very bearish. The shares are currently trading in the middle of the trading range. A breakdown below 3.5p would open the doors for a retest of the range lows around 2.55p.
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This post was last modified on %s = human-readable time difference 15:18