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Chevron’s Moving Averages ahead of Earnings

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Chevron’s moving averages trend up to January 2018

Before we look at Chevron’s (CVX) moving average since January 2, let’s briefly look at how moving averages trended until then.

CVX’s 50-day moving average (or DMA) fell below its 200 DMA in 2Q17 due to a decline in the stock, likely led by weaker oil prices. In 3Q17, Chevron posted 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 DMA again surpassed its 200 DMA.

In 4Q17, Chevron’s 50 DMA 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 make new highs—probably due to higher oil prices and tax reforms announced in the United States.

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Chevron’s moving averages since January 2

Since January 2, the decline in Chevron’s stock led to a fall in its 50 DMA. Weaker broader markets may have affected the stock. We discussed this impact in the previous part of this series. In the same period, Chevron reported its 4Q17 earnings, which missed Wall Street analysts’ estimates. This miss could have further pressured Chevron’s stock.

Chevron’s 50 DMA fell 3.9% since January 2. CVX’s 50 DMA has broken below its 200 DMA, right ahead of its earnings. Chevron’s 50 DMA, which stood just 6.9% above its 200 DMA on January 2, now stands 0.7% below its 200 DMA, which is technically a bearish sign.

Going forward, if the company posts better-than-expected 1Q18 earnings or the market gets stronger, or WTI rises, or any positive news occurs, Chevron’s stock could rise, leading to a surge in its 50 DMA. Chevron is expected to post its 1Q18 earnings on April 27.

Peers’ moving averages

Like Chevron, ExxonMobil’s (XOM) 50 DMA also stands 5.3% below its 200 DMA. However, Petrobras (PBR), ENI (E), and Suncor Energy’s (SU) 50 DMAs stand 26.5%, 4.4%, and 0.4%, above their 200-day moving averages, respectively. Also, PetroChina (PTR), YPF (YPF), and Statoil’s (STO) 50 DMAs stand 4.0%, 0.4%, and 11.9%, respectively, above their 200 DMAs.

Read on to the next part of this series to look at Chevron’s stock price estimates ahead of earnings.

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