Yearly Topping Pattern

On 25 Feb we reported about a probable long term reversal pattern forming on the XOM yearly price chart (stock price adjusted for dividend payments):

Confirmation Bear Market Signal on the Daily Time Frame

On 7 March we identified a continuation bear market signal on the daily time frame:

XOM Now Triggering a Monthly Bear Signal

After gyrating several times inside the volatility envelop the XOM price triggered a bear signal by taking out the low from the February monthly candle that had closed outside of the volatility bands (red segment). This is particularly bearish signal and further price weakening should be expected. A reasonable target is the rising 200-period monthly average (dotted line) around $65:

Quarterly XOM Price Scenario

The $65 price target also corresponds to an intermediate support line on which the XOM price reverted abruptly in both Jul 2011 and July 2015. If past price action is any guide we could expect to see a similar reaction taking shape in the coming months. This time however should we expect the retrace to be contained around the $80 price level before the bear market resumes in direction of the $55 level with more putative moves highlighted with dotted lines in a more distant future.