Is now the time to pick up this old favourite?

Gulf Keystone (LSE:GKP)

There are times when stepping back to review “The Big Picture” can be profoundly disappointing. It can be similar to catching an unexpected view of yourself in a hotel bathroom mirror and asking, “just when did that happen?” Gulf Keystone (GKP)’s share price exhibits such traits, though of the slimline variety.

The chart below, dating back to 2016, tends to put recent movements in context. While the companies shares are more than double their value from the scary days in 2017, against the bigger picture the viewpoint is rather depressing. Unfortunately, it gets worse!

The current situation, while looking encouraging against historical lows, has a major problem.

With the best will in the world, since the share price was mangled with a 100:1 split at the end of 2016, we’re calculating the current rising cycle risks stuttering around the 215p point.

Basically put, it will either require gapped (manipulated) above the 215p level or more probably, experience some reversals anytime soon as by going down it should gather arithmetic strength to go up. Or so the crazy world of trends demands.

The ‘major problem’ we refer to is circled on the chart. Through September and October 2016, it’s clear the market had some sort of issue with GKP’s price and this has created a glass ceiling at 225p.

Therefore, our best case ambition on the immediate movement cycle at 215p falls some way short of troubling this potential share price barrier. But it does lend weight to an expectation of some turbulence prior to any proper recovery.

Unfortunately, such has been the pace of ascent the price needs below 159p for any concern, this being capable of provoking reversal toward an initial 133p where a bounce can be hoped.

Unfortunately, if GKP share price opts to display its usual sense of humour, there’s a risk of 133p breaking and the real bottom being found at 115p.

From a big picture perspective, not a big deal but probably capable of leaving a rather bitter taste amongst the shares once fanatical fan base.

Source: interactive investor                    Past performance is not a guide to future performance

Alistair Strang has led high-profile and “top secret” software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know “how it worked” with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.

Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang, Shareprice, or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea. 

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