As of August 25, 2017, Marathon Oil (MRO) had an implied volatility of ~32.7%, which is lower than its implied volatility of ~35.4% on August 18, 2017.
Weekly price range forecast
Based on its implied volatility of ~32.7%, assuming a bell curve model (or normal distribution of prices), 365 days in a year, and a standard deviation of one, Marathon Oil stock is expected to close between $11.55 and $10.55 in the next seven calendar days. Marathon Oil stock will stay in this range 68% of the time—based on the standard statistical formula.
As of August 25, 2017, the SPDR S&P500 ETF (SPY) has an implied volatility of 8.4%. In the last three weeks, SPY’s implied volatility marked a high of 21.50%. Implied volatility doesn’t forecast a stock’s future direction. It’s derived from an option pricing model. The data are theoretical. There isn’t a guarantee that the forecasts will be correct.
Marathon Oil’s moving averages
As of August 25, 2017, Marathon Oil is trading below its 200-day and 50-day moving averages. In fact, Marathon Oil lost its 50-day moving average in the third week of August. On August 25, its stock price closed at $11.05, while its 200-day and 50-day moving averages stand at $14.77 and $11.72, respectively. Marathon Oil’s 50-day moving average stands below its 200-day moving average, which is a bearish sign.
As of August 25, 2017, Marathon Petroleum’s peers ConocoPhillips (COP), Devon Energy (DVN), and Southwestern Energy (SWN) have implied volatilities of ~21.40%, ~30.4%, and ~54.4%. Devon Energy and Southwestern Energy’s implied volatilities have increased considerably compared to their implied volatilities of ~21.9% and ~49.6% on August 18, 2017. The First Trust Natural Gas ETF (FCG) invests in natural gas producers, while the Energy Select Sector SPDR ETF (XLE) generally invests at least 95% of its total assets in oil and gas companies.