Echo Energy (LSE:ECHO) has announced drilling has commenced of the first exploration well at the Company’s onshore Fracción C asset in Argentina. It signals the start of a four well back-to-back drilling campaign in the field and shares were up 6% on the news this morning. A look at the share price chart reveals Echo is in a general upward trend with strong channel support having endured three tests since September last year when the share price dropped back to 8.25p. Four months prior to that, the stock hit highs of 26.7p following a £10m investment from institutional backers, Pegasus.
Price action is currently in a symmetrical triangle, with 15p to beat to break upward. Thereafter an initial share price target for the stock might be the top of its current trend channel and previously tested high close of around 21.75p. Should the upward channel break there’s further support at 11-12p. Of course, significant success with the drill bit could send the price much higher or indeed lower in the case of failure – that is the nature of oil and gas exploration.
