ONEOK, Inc. operates as a diversified energy company in the United States. The company operates in three segments: ONEOK Partners, Natural Gas Distribution, and Energy Services. The ONEOK Partners segment engages in gathering, processing, storing, and transporting natural gas; owns and operates interstate and intrastate regulated natural gas transmission pipelines and natural gas storage facilities; and gathers, treats, fractionates, stores, and transports natural gas liquids (NGL) to third-party fractionators and pipelines. This segment is also involved in the storage and distribution of NGL products to petrochemical manufacturers, heating-fuel users, refineries, and propane distributors through regulated distribution pipelines. The Natural Gas Distribution segment provides natural gas distribution services to approximately 2 million customers, including residential, commercial, industrial, and transportation customers, as well as wholesale and public authority customers in Oklahoma, Kansas, and Texas. The Energy Services segment offers natural gas supply and risk-management services for natural gas and electric utilities, and commercial and industrial customers through its network of leased storage and transportation capacity.
To review ONEOK’s stock, please take a look at the 1-year chart of OKE (ONEOK, Inc.) below with my added notations:
Notice the falling wedge that I have outlined on the chart of OKE. A falling wedge price pattern is essentially a type of triangle formation in which the stock (OKE) has formed a downtrending resistance line (red) and a downtrending support level (blue). These two trend lines converging on one another combine to form a falling wedge, which is considered a bullish pattern.
Confirmation of this pattern occurred when the stock broke through the downtrending resistance. In addition, the stock also broke back above its key level of $42 (brown).
The Tale of the Tape: OKE has confirmed its falling wedge pattern, which should lead to higher prices for the stock. A long trade could be entered on a pullback to the key level of $42 with a stop placed below that level.
Would you like assistance in making your TBS trades? If so, email me at Christian@yolopub.com and let’s talk about working together one on one!
Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.
No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!
Christian Tharp, CMT