Precision Drilling technical analysis

Precision Drilling (PD:TSX) candlestick chart with a bullish engulfing pattern
Candlestick chart analysis showing a bullish engulfing pattern on the weekly chart with confirming volume.

Precision Drilling (PD:TSX) 2-Year Weekly Chart

Reference the previous chart analysis for Precision Drilling.

Precision Drilling Corporation (“Precision”) intends to release its 2011 first quarter results before the market opens on Tuesday, April 26, 2011 and has scheduled a conference call and webcast to begin promptly at 12:00 Noon MT (2:00 p.m. ET) on the same day.  Analysts expect earnings of 26 cents a share.

April 26, 2011 Update: The Calgary-based concern on Tuesday posted net earnings of $66 million, or 23 cents per share, for the three months ended March 31. That compared with net earnings of $57 million, or 20 cents per share, in the first quarter of 2010.

Candlestick chart for Precision Drilling showing a doji candlestick pattern in reaction to the first quarter results

(PD:TSX) 1-Month Daily

What will be the reaction on the chart to the first quarter results?  That is all that counts.

A doji candlestick (opens and closes at or very near the same level) formed on the daily chart at the end of trading for Tuesday, April 26, 2011. This was the reaction of the market to the first quarter results. It represents indecision and a battle between the bulls and the bears. Considering the recent run-up in the stock price,  the fact that Precision Drilling stock did not sell off on the earnings miss is a positive reaction on the chart. Set alerts at $15.00 and $14.00 and monitor for the development of a consolidation pattern.
Doji candlestick with the opening and closing price at the same level
The doji candlestick has the same opening and closing price.  In the Precision Drilling chart to the right, the doji is part of a consolidation pattern. But, the doji is an important candlestick especially for indicating tops.  As in all technical analysis, you have to look at the total picture before making a decision based on one candlestick formation.  Always look at the price action the next day to corroborate any pricing pattern.

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