88 Energy PLC (LON:88E) shares may be off the year’s earlier highs, but, according to chart guru Zak Mir, the price could head back towards 5p in the coming months.
Mir, in a TIP TV segment for Proactive Investors, highlights that 88 Energy shares are in an uptrend.
Studying the chart he notes that a ‘golden cross’ trigger preceded a sharp rise in 88 Energy’s share price early in 2016, and it has remained in an uptrend since.
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That is positive for traders even if they don’t want to know anything else about the chart he says, though he adds that the stock has also broken through the 50-day moving average, which is a key momentum signal.
“Being above the 200-day line, and while it is above it at 1.9p, you’ve got to be positive [about the share],” Mir said.
Those following the 88 Energy story closely will know the Alaska-focussed explorer is currently working on the evaluation of its potentially big oil discovery in a shale play, and it is beginning preparations for its next well.
A vertical well is estimated to cost around US$5mln less to drill and the well can be paid for entirely from the group’s current cash position, the company told investors.
It will enable a multi-stage fracking programme. Importantly, the vertical well will test both the HRZ and HUE shales at Project Icewine.
The company added that as it will test the production potential of the entire HRZ/HUE interval there is potential for an upgrade to resources.