Diamondback Energy (FANG), one of the leading operators of the Permian Basin, is approaching a moment of technical reckoning. The stock is back up toward $170.15, a level that holds painful memories for anyone who rode the crash. This was not just a failure of support. The price tested the $170 level twice, and when it finally collapsed, the collapse was fast and merciless. Fang didn’t just drift down; It fell nearly 35% to $112 before finding a floor.
The drop at $112 was a sign of capitulation. Sellers have exhausted themselves, and buyers are stepping in, cautiously at first, then with increasing conviction. What emerged from that bottom was the uptrend line we are seeing today: a steady march from the higher lows that took FANG back to $148. This is not a vertical recovery; It is a systematic move higher that indicates real buying interest rather than a fleeting bounce.
But now comes the test. This $170.15 level is the right place where support has turned into resistance. This is traditional technical behavior: a broken support level often becomes the new ceiling. Why? Because traders who bought around $170 during the initial crash are still underwater, many will be looking to exit near breakeven if the price returns. Add to that the psychological weight of this double failure, and you have a formidable barrier.
The bullish case hinges on reclaiming $170.15 decisively. If FANG can push and hold above this level for a few sessions, it will turn the entire scenario around – turning resistance back into support and possibly opening the door to the $185-$195 area. That would represent a full recovery of more than half the decline from the 2024 highs.
Bearish alternative: Rejection at $170.15 followed by a breakout of the uptrend line would be very worrying. A close below $140 would negate the uptrend structure and likely send the price to test the $130-125 support area, with $112 back in play if this does not hold.
For traders, patience pays off here. Bulls may wait for a confirmed break above $172-$175 before committing, while those who expect resistance to hold can watch for rejection signals near $170 with a stop above $175. The trend line between $142 and $145 provides a safer entry for those who want to buy on the dip with tight stops.
Diamondback Energy is rewriting its story one session at a time. Whether $170.15 becomes a starting point or a ceiling, it will tell us everything about the strength of this recovery.
