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Understanding Refining Stocks’ Moving Averages in 1Q18

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Refining stocks’ moving averages in 2017

In 1Q17, Marathon Petroleum (MPC), Valero Energy (VLO), Andeavor (ANDV), and Phillips 66 (PSX) witnessed a decline in their stock prices. MPC, ANDV, and VLO’s 50-day moving averages remained above their 200-day moving averages. But PSX’s 50-day moving average fell below its 200-day moving average in March 2017.

In the second quarter, refining margin indicators for MPC, VLO, and ANDV rose in 2Q17 over 1Q17. MPC and VLO’s 50-day moving averages remained above their 200-day moving averages in the second quarter. However, Andeavor (ANDV) 50-day moving average fell below and later surpassed its 200-day moving average as it completed the process of taking over Western Refining. In 3Q17, PSX’s 50-day moving average surpassed its 200-day moving average.

In 4Q17, refining companies reported their 3Q17 earnings. MPC, VLO, and PSX beat earnings estimates for 3Q17. But ANDV’s 3Q17 earnings missed estimates. However, all four refining stocks’ 50-day moving averages continued to trade above their 200-day moving averages.

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Refining stocks’ moving average changes in 1Q18

In the first quarter of 2018, MPC, VLO, PSX, and ANDV’s 4Q17 earnings beat analysts’ estimates. The stock prices showed mixed trends, but their 50-day moving averages stayed above their 200-day moving averages.

Currently, MPC and ANDV’s 50-day moving averages trade 16% and 10% above their 200-day moving averages, respectively. Also, VLO and PSX’s 50-day moving averages stand 21% and 12% above their 200-day moving averages, respectively. 

The SPDR Dow Jones Industrial Average ETF (DIA) and SPDR S&P 500 ETF’s (SPY), which approximately represent the broader economy, saw their 50-day moving averages trade 10.0% and 6.9% above their 200-day moving averages, respectively.

In the next part of this series, we’ll look at MPC, VLO, ANDV, and PSX’s price forecast range, based on their current implied volatilities.

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