How will the record output and resilient profitability affect CNOOC's short‑term price momentum?

Fundamental backdrop: CNOOC’s interim results show a 6.1 % YoY rise in total oil & gas output and a 12 % jump in natural‑gas production, while profitability stays “resilient” despite a volatile price environment. The boost in volume not only tightens the supply‑side narrative for the company but also reinforces its cost‑competitiveness, which should underpin earnings guidance for the rest of 2025. With the broader oil market still trading near $80‑$85 per barrel and natural‑gas prices stabilising after the winter rally, the incremental cash flow from higher volumes is likely to be perceived as a near‑term earnings tailwind, keeping sentiment bullish (news sentiment score 70).

Short‑term price momentum: Technically, CNOOC has been trading in a tight 20‑day range (HKD 5.55‑5.85) and recently broke above the 20‑day SMA on higher volume, forming a modest bullish flag. The earnings surprise is expected to act as a catalyst, pushing the stock through the upper trend‑line around HKD 5.80. In the next 1‑2 weeks, expect the price to test the recent high of HKD 5.95; a breach with confirming volume could trigger a short‑term rally toward the 50‑day SMA resistance at HKD 6.10. Conversely, if the market digests the news and takes profit, the price may retrace to the 20‑day EMA (~HKD 5.70) before the next upward impulse.

Actionable trade idea: For momentum‑focused traders, a long entry around HKD 5.78–5.80 with a stop‑loss just below the 20‑day EMA (≈HKD 5.65) offers a risk‑reward of roughly 1:2–1:3 if the stock clears HKD 6.00. A tighter scalp could be taken on the breakout above HKD 5.80 with a 2‑day target at HKD 5.95. For more conservative positioning, consider buying a near‑term call spread (e.g., 5‑month 5.80/6.20 strikes) to capture the upside while limiting downside exposure. The strong output numbers and resilient earnings give a solid fundamental base that should sustain this short‑term bullish bias.