With a market cap of over $115B, ConocoPhillips is one of the largest oil & gas companies in the world. The global economy’s reopening helped the stock recover from its pandemic low, before Russia’s invasion of Ukraine pushed it to a new record in 2022. But ConocoPhillips has struggled to hold its ground as oil and gas prices normalized.
Currently trading below $94 a share, the stock is down by a third from its all-time high of $138.50 reached in November, 2022. So it is fair to say that ConocoPhillips, alongside the entire oil and gas industry, has been dead money for almost three years now. But commodities are notoriously cyclical. Perhaps it is time for this cyclicality to start working in the company’s favor again.
This Elliott Wave chart suggests that the bears might finally be done with ConocoPhillips. It reveals that the surge from $21 in March, 2020, to $138.50 in late-2022, is a textbook five-wave impulse. We’ve labeled the pattern (1)-(2)-(3)-(4)-(5), where two lower degrees of the trend are also visible within wave (3).
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According to the theory, a three-wave correction follows every impulse. And that’s what the decline we saw over the past three years stands for. It can be seen as an (a)-(b)-(c) flat correction, whose waves (a) and (b) are simple a-b-c zigzags, while wave (c) is an expanding ending diagonal, marked 1-2-3-4-5.
If this count is correct, the Elliott Wave cycle is complete and it is time for the pre-2023 uptrend in ConocoPhillips stock to resume. New all-time highs make sense going forward, putting initial upside targets above $140 per share on the table. The possibility of the price doubling to $200 cannot be ruled out in the long term, either.
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