Karoon Energy is an oil and gas exploration company with assets in Brazil.

The company has been increasing production over the past few years and should continue to benefit from higher oil prices over time,” Michael said.

“The chart for KAR is very interesting because it has spent the last 18 months unable to trade beyond the $2.40 area.

“Every time it gets near that level, the sellers step up to the plate.

“Obvious resistance levels like this are very important to be aware of, because once a stock can clear that level, it indicates that the major selling is already out of the way, and it leaves the stock clear to continue trending higher again.

“After a couple of aborted attempts, KAR has finally broken out that 18-month trading range (circled).

“Short-term, it is looking overbought so any retest back near $2.40 would be a buying opportunity again.

“But longer term, this breakout means that KAR can potentially head to much higher levels,” Michael said.

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