From a fundamental viewpoint, the group is in a bad financial situation with debt increasing every year. Moreover, sales prospects are not encouraging as revenue should stay close to GBP 2.6 billion in the coming years. Analysts have recently downgraded their forecasts for earnings per share. This indicator is often a precursor of a declining profitability and a worsening climate of investors' confidence.

From a technical viewpoint, prices are in a downward trend. Moving averages are trending down and put pressure on the stock, which confirms this downward momentum. The breakdown of the GBp 722 on closing price would be a bearish signal for a continuation of the current trend.

Investors could take a short position in Tullow Oil under GBp 722. The target will then be GBp 650. They will also place a stop loss above Bp 755, in case of a bullish reversal.