TheStreet'sQuant Ratings service upgraded Diamondback Energy Inc. (FANG) - Get Report today so a look at the charts and indicators is warranted. I have commented in Kamich's Korner on Real Money many times that a combination of investment approaches can be superior to following just one. Let's see if the charts and indicators have improved along with the quantitative evaluation.

In this daily bar chart of FANG, below, we can see a possible lopsided double-bottom pattern with a low in June and a slightly higher low in August. The pattern will not be complete or break out until FANG closes above the July/August highs around $98. Prices have strengthened enough in recent weeks to turn the slope of the 50-day moving average line positive.

The declining 200-day moving average line is still above the market and intersects just above $98. The daily On-Balance-Volume (OBV) line shows a small improvement in early August suggesting some aggressive buying and further gains in the OBV line, should they occur, would be positive for FANG shares. In the lower panel is the Moving Average Convergence Divergence (MACD) oscillator, which just crossed to the upside for a cover shorts buy signal.

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In this weekly bar chart of FANG, below, we see a picture of a stock that need a little more development. Prices are below the declining 40-week moving average line and there is a lot of potential chart resistance above $100. The weekly OBV line has not moved much in the past three months, suggesting that investors have not made big new commitments to the long side. In the bottom panel the MACD oscillator is poised for a cover shorts buy signal but an outright go long signal will likely take time.

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In this Point and Figure chart of FANG, below, we can see a downside price target of $82.54. If $82.54 is the downside risk, then traders should use a stop below that point when probing the long side.

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Bottom line: FANG has been working on a turnaround the past three months. A close above $98 should get things going on the upside.

Click here to sign up for Quant Ratings, where you can read our full report on Diamondback Energy or more than 4,000 other stocks that our service rates in real time every market day. However, please note that our Quant Ratings service assesses stocks using a proprietary computer model that runs a variety of factors through quantitative and technical analysis. Ratings do not necessarily reflect the opinions of Jim Cramer or other columnists, who may use different criteria to grade stocks.

(This column originally appeared on Real Money, our premium site for active traders. Click here to get great columns like this from Bruce Kamich, Jim Cramer and other writers even earlier in the trading day.)

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