Clean Energy (CLNE) has not formed a clear trend since the stock debuted at $12 in May of 2007. This is somewhat common for companies in emerging industries, as investors are still sizing up future prospects.
The good news is investors seem to agree that Clean Energy is worth no less than $10 – $12 dollars a share. You can see from this chart of CLNE there is a strong zone of support at this price range. Since 2007, the stock has held above this zone ten times. CLNE traded below $10 only during the financial crisis of 2008 – 2009.
Let’s look at how Clean Energy is trading now. As you can see, after a steep decline, CLNE is holding above the support level of $12.
What’s more, a reverse head-and-shoulders patternrn is forming. Now is not the time to buy… we must let the patternrn play out.
But if CLNE breaks above $15, the “neckline” of the patternrn, then we’ll get the bullish signal we need to buy shares.
If CLNE breaks above $15 it should head higher to at least the $17.50 to $18.50 range. The top end of that range should hand us a nice 23% gain.
We’ll keep an eye on this intermediate-term patternrn… as well as the long-term prospects of the natural gas infrastructure market.
If you haven’t done so already read the Survive & Prosper issue on “Natural Gas – The Future of Energy”.