WARREN BUFFETT is missing my Chart Analysis - OXY TO $29 Hello Traders, I am back, because Warren Buffett is making a Huge Mistake!
If he was looking at my chart analysis, he would not making this mistakes. I am sure he is the top fundamental analysis, but I am also sure, he does not know about technical analysis.
If he had known about technical analysis, he would not have allowed Berkshire Hathaway to buy 763,000 shares of OXY for an average price of $46.82, in February 2025.
In late December, Berkshire purchased 8.9 million Occidental shares during a broad market pullback. Occidental remains Berkshire’s sixth-largest equity holding.
Warren Buffett is undoubtedly a master of fundamental analysis, but his recent decision to buy more Occidental Petroleum (OXY) after a 30% sell-off from its record high suggests he may be missing the bigger picture when it comes to technical analysis.
While Buffett has always emphasized intrinsic value and long-term potential over short-term price movements, ignoring technical indicators can be costly—especially in the case of a highly cyclical stock like Occidental. The steep decline in OXY's price is not just a random fluctuation; it reflects broader market sentiment, momentum shifts, and key support levels that Buffett appears to be disregarding.
One of the major issues with Buffett’s approach is that he tends to view price declines purely as opportunities to buy undervalued stocks without considering whether the stock is in a downtrend with further room to fall. Occidental’s 30% drop from its peak could indicate the start of a deeper correction or even a long-term shift in investor sentiment toward oil stocks.
Technical analysts would look at moving averages, relative strength index (RSI), and volume trends to determine whether the stock is showing signs of bottoming or if further downside is likely. Buffett, however, does not appear to incorporate these tools, potentially exposing Berkshire Hathaway to further losses.
Another critical aspect of technical analysis that Buffett seems to overlook is support and resistance levels.
If Occidental broke the current level of support of $45, it could suggest that institutional investors are exiting the stock, meaning that further declines are possible before a true bottom is found.
Rather than blindly averaging down, a trader versed in charts would wait for confirmation of a reversal, such as a double bottom or a bullish divergence in momentum indicators. Buffett’s reliance solely on fundamentals ignores these crucial signals, making his timing questionable at best.
Additionally, market psychology plays a significant role in stock movements, and Occidental’s sharp sell-off could be signaling broader concerns about the energy sector. Even if the company’s fundamentals remain strong, investor sentiment can drive the stock much lower before any recovery takes place.
Buffett’s historical strategy of buying quality stocks and holding them for decades works well in certain cases, but oil stocks are notoriously volatile and highly correlated with macroeconomic factors like interest rates, geopolitical events, and commodity cycles. By ignoring these elements, Buffett may be underestimating the risk of catching a falling knife.
Ultimately, while Buffett’s deep understanding of business fundamentals is undeniable, his reluctance to embrace technical analysis could lead to costly missteps—especially in a stock like Occidental, which is heavily influenced by momentum, sentiment, and cyclical trends. His recent purchases may look brilliant years down the line if OXY eventually recovers, but in the short to medium term, he may have simply stepped into a stock that still has further to fall.
By incorporating chart analysis, Buffett could refine his timing and avoid unnecessary drawdowns, but his firm stance against technical indicators may mean he continues missing key signals in volatile stocks like Occidental.
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Sell OXY NOW WARREN BUFFETT, if you can hear me.
For my followers stay out if you do not understand, this is a crazy world.
Not allowed for Kids.
ECT
