Ecopetrol S.A., incorporated on July 18, 2003, is an oil company. The Company operates in Colombia, Peru, Brazil and the United States Gulf Coast. The Company's segments include Exploration and Production, Transportation and Logistics, and Refining, Petrochemicals and Biofuels. Exploration and Production
The stock is trading in lock-step with the Colombian Peso -- higher peso, lower EC. Broke the 50 DMA but holding into its 20 WMA. Held $20.00 twice already. If it holds it will likely re-test $22 - $23.I don't like the company or sector but for a trade it offers a good R/R ratio.
Needs to hold onto to $20 into Labor to validate the trade up to $22 to $23 otherwise it re-tests $17 before re-evaluating.
Acting better than the EEM, even with a small bid in the Colombian peso. May be the trade to catch on an emerging market trend retracement if there is one. $19 continues to serve as strong support. But as mentioned above, $20 will need to hold to validate a trade up to $22 to $23.
Proved to one of the better trades to catch on the EEM side. Didn't quite peg the lower band of the price objective -- $22.00 -- but it came close at $21.92. Stable Colombian peso helped against a backdrop of weaker EM currencies. There is always a trade to be had in every stock, but as I've made it abundantly clear, I would avoid trading or investing anything related to emerging markets except the more renowned, cash-hoarders like an Alibaba, Baidu and Adidas that have strong individual niches that are able to generate cash flow without being affected to a large degree by exterior forces (call them what you want). A name like EC is tied to a number of exogenous factors that it cannot control. Even though it is one of the largest companies in Colombia with a backing, there is simply no visibility because of a lack of catalysts. Its best to avoid the name.
