Date: 29 Apr 2019

The Dutch/British company, Shell, has been continuously in the news over the last few days, whether voluntarily, for PR purposes, or involuntarily through critical reporting.

Shell’s path to its goal of becoming a clean energy company has been a stony one. First, the news came out that Shell wants to invest several billion dollars in green energy over the next few years (link: From oil to green electricity. Will this boost the share price?). Then the story hit the wire that Shell wanted to leave the American Fuel & Petrochemical Manufacturers group (link: Is Shell’s news good news for the stock?), the essential American interest group in the oil sector.

Last Friday, the Financial Times reported that a Dutch corporate governance group (Eumedion) intends to influence Shell. Specifically, it is about the rights of LGBT people in Brunei. As reported in various media, Brunei has introduced a new, stringent penal code to the detriment of LGBT rights. The situation could be difficult for Shell, as it was named one of the best LGBT employers in the summer of 2018.

The small state of Brunei is one of the wealthiest countries in the world because of its abundant oil and gas reserves. Shell is an essential part in the distribution of these oil reserves. Shell is involved in the Brunei oil business indirectly, through a government joint venture that generates 90 percent of the country’s oil revenues, according to last Friday’s Financial Times report.

A look at the chart shows that the stock failed for the second time at the lower edge of the October gap. The band between €28.57 and €29.17 should be decisive for further rising prices. If the market can return to this band and break through the upper limit at €29.17, the area between €29.81 and €30.17 could be the next, larger structural zone for the market.

First, however, the market must find support. Because if it does not, the bears could take over. Then the area around €28.02 could provide the first support for the market. Further support zones could wait for the market in the areas around €27.45, €26.92 and €26.38.

The MACD oscillator is currently bearish. The MACD line has crossed its trigger line from up to down. The histogram is below its zero lines and is accurately tracking the price movement.

 

RDSA.NE Daily Chart Source: ActivTrader

RDSA.NE Daily Chart Source: ActivTrader

 

Written by Daniel Schuetz, External Analyst

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