Company Description: Petroleo Brasileiro SA-Petrobras is an integrated oil and gas company. During the year ended December 31, 2008, the Company’s average domestic daily hydrocarbons production was 2,176 thousand barrels of oil equivalent per day (mboe/d). Approximately 84% of its proved reserves are in fields in the offshore Campos Basin. The Company operates the refining capacity in Brazil. The Company’s domestic refining capacity is 1,942 thousand barrels per day (mbbl/d). Its domestic refining production is 1,787 mbbl/d and sales of oil products to domestic markets is 1,748 mbbl/d. The Company is also involved in the production of petrochemicals and fertilizers. The Company distributes oil products through its own BR network of retailers and to wholesalers. During 2008, it increased its stake in the Sierra Chata and Parva Negra blocks to 45.55% and 100%, respectively, and acquired a 13.72% stake in the El Tordillo and La Tapera-Puesto Quiroga blocks. In November 2009, it acquired Chevron Chile SAC..

Our Analysis: The shares of Petroleo Brasileiro 'PBR' have been in a downward trend since earlier this year. Yesterday they closed below a recently established downside support level. The shares of 'PBR' should continue to move lower and test $35.44/share, a point of downward support established on July 8th of last year. If the shares of 'PBR' close below that level, then they should continue to move lower and test $32.43/share, the point from which they gapped higher on the open of trading on April 29th of 2009. I see upside resistance on the shares of 'PBR' @ $36.49/share, and have set my stops accordingly at $36.87/share.