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Where Is Energy Transfer Equity Stock Headed?

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Energy Transfer Equity’s moving averages

Energy Transfer Equity (ETE) went above its historical moving average driven by its rally following the slight recovery in crude oil prices. ETE was trading 2.5% above its 50-day SMA (simple moving average) and 0.7% above its 200-day SMA as of July 10, which might indicate a bullish sentiment in ETE. ETE’s peers ONEOK (OKE) and Plains All GP Holdings (PAGP) are currently trading 3.6% and 6.8% below their 200-day moving average, respectively, while Williams Companies (WMB) was trading 2.6% above its 200-day SMA.

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Short interest in Energy Transfer Equity

Short interest in Energy Transfer Equity was 58.1 million shares as of July 10, 2017. At the same time, its short interest as a percentage of float ratio was 7.4%. The current short interest in ETE is slightly higher than last month’s average of 7.4%. Moreover, short interest in ETE is higher compared to the one-year and three-year averages of 6.1% and 5.3%, respectively. A rise in short interest indicates an increase in a short position that hasn’t been covered.

Energy Transfer Equity’s implied volatility

Energy Transfer Equity’s 30-day implied volatility was 33.9% as of July 10, 2017. ETE peers Williams Companies and ONEOK have implied volatilities of 25.1% and 27.4%, respectively, as of July 10. In comparison, the Alerian MLP ETF (AMLP) has an implied volatility of 17.1%. ETE’s high implied volatility might reflect its subsidiaries’ relatively high crude oil exposure through natural gas midstream and crude oil acquisition and marketing businesses. ETE’s earnings are dependent on distribution income from its subsidiaries.

Energy Transfer Equity’s price forecast

Energy Transfer Equity might trade in the range of $17.01–$18.69 in the next seven days based on its July 10 closing price of $17.9 and assuming a normal distribution of prices. ETE’s stock price is expected to be within this range 68.0% of the time.

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