Chesapeake Energy Corporation (CHK) Stock Rallies 50% In Three Weeks

The second largest oil and gas company, Chesapeake Energy Corporation, in US has recovered from its 52-week decline on August 25, in order to achieve approximately 50%.

Chesapeake Energy Corporation which is one of the biggest natural gas producer in USA, which is struck by a downward steep in the energy sector because the crude gas and oil prices showed a decline. During the last 12 months, CHK stock slid by 65% and suffered a loss of more than a quarter of its amount throughout the last three months. The prices of crude oil have been reduced to its half value with West Texas Intermediate crude oil upcoming trading at $46.39-per-barrel and futures trading of Brent crude oil at $48.98-per-barrel. Throughout the last year, natural gas prices showed a decline by 25%. After the commodity prices failed to restore, the company’s stock reached its 52-week low at $6.01 on August 25. On the other hand, as the company showed its turnaround reaching $9 throughout the trading session on Thursday, it indicated the raise by 50% from August’s decline. For the time being, Chesapeake Energy Corporation (NYSE:CHK) is the second best performer with respect to the S&P’s Energy Index from August 25. At the same time, the organization, which is going through the ceiling, is Cameron International Corporation that stood at first position with the gain of 56%. The initial restoration was backed by the technical, as the 14-day RSI fell below 30 of gas company on August 25. The company stock is probably below its worth, financial investors were conferred with the buying opportunity. The stock might have survived a short hold as well, after its short interest raised by 217.6 million shares on August 31, which is the highest peak level during the last 10 years. The evaluated ratio regarding the days to cover is 10.65 days as of August 31, suggesting traders’ need of 11 trading sessions to cover short positions over the stock, while making it susceptible to a short-hold. It is expected that the short squeeze would be boosted by an immediate recovery in the stock, stressing short sellers to reduce their losses and restore their positions by buying the stock that adds to upward reinforcement over price. Doug Lawler, the CEO of oil and gas company, affirmed in a press release last month about their collaboration with William Companies. He said, “These agreements will result in lower gathering rates and lower differentials, making these assets even more competitive within our portfolio.” Several analysts from the Street advised care and precaution while dealing with Chesapeake’s shares. Thus, investors and shareholders are alerted.