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Chevron’s 50-Day Moving Average Weakens

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Mar. 27 2018, Published 2:18 p.m. ET

Chevron’s moving averages in the past four quarters

Chevron’s (CVX) 50-day moving average slid down but stayed above its 200-day moving average in 1Q17. The downtrend in Chevron stock extended in 2Q17. As WTI plunged, Chevron stock fell, and its 50-day moving average broke below its 200-day moving average in 2Q17.

In the third quarter, Chevron posted its 2Q17 earnings, which beat estimates. Plus, WTI prices rose as the effects of Hurricane Harvey faded. By the end of the third quarter, Chevron’s 50-day moving average surpassed its 200-day moving average. If short-term moving averages surpass a longer-term average, it’s seen as a bullish technical sign.

In 4Q17, Chevron’s 50-day moving average surged steeply, led by a sharp rise in Chevron stock. In fact, in the fourth quarter, Chevron stock hit a 52-week high and continued to hit new highs—probably due to higher oil prices and tax reforms in the United States.

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Chevron’s moving averages in 1Q18 so far

In 1Q18, Chevron’s 50-day moving average continues to stay above its 200-day moving average. However, Chevron’s 50-day moving average has plunged since February 2018. CVX’s 50-day moving average, which stood 6.9% above its 200-day moving average at the beginning of the quarter, now stands 3.8% above its 200-day moving average. The fall in Chevron’s 50-day moving average is due to a steep decline in Chevron’s stock. We discussed Chevron’s stock fall in the previous part of this series.

Peers’ moving averages

Like CVX, PetroChina’s (PTR) 50-day moving average trades 7.8% above its 200-day moving average. Similarly, YPF (YPF) and ENI’s (E) 50-day moving average trades 4.6% and 5.8% above its 200-day moving average, respectively. Also, Suncor Energy’s (SU) 50-day moving average stands 3.4% above its 200-day moving average.

Also, the broader market indicators—the SPDR Dow Jones Industrial Average ETF’s (DIA) and the SPDR S&P 500 ETF’s (SPY) 50-day moving averages—trade 8.2% and 6.2% above their 200-day moving averages, respectively.

For Chevron’s stock price range forecast up to March 30, read on to the next part of this series.

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