Where Have BP’s Moving Averages Trended?


Apr. 27 2018, Updated 7:32 a.m. ET

BP’s moving averages

Before we look at BP’s (BP) moving averages since January 2, 2018, let’s briefly look at how its moving averages trended in the past.

In 2Q17, BP’s 50-day moving average crossed over its 200-day moving average. BP reported its 1Q17 earnings, which surpassed the estimates. BP reported the start of two of its major upstream projects—West Nile Delta and Quad 204.

In 3Q17, likely due to Hurricane Harvey, oil prices declined and pressured BP stock. BP’s 50-day moving average broke below its 200-day moving average. As the effects of Hurricane Harvey started easing, oil prices started rising, which supported the stock. BP’s 50-day moving average crossed over its 200-day moving average at the end of 3Q17. In 4Q17, BP’s 50-day moving average rose. The stock likely rose due to upstream project updates and BP’s 3Q17 numbers, which exceeded analysts’ estimate.

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Changes in BP’s moving averages

Since January 2, BP published its 4Q17 earnings. BP surpassed its earnings estimates for 4Q17. BP’s upstream earnings rose year-over-year. However, weaker broader markets and lower oil prices in February, as we discussed in the previous part, led to the marginal gain in BP stock. BP’s 50-day moving average, which was 9.3% above its 200-day moving average on January 2, is 3.4% above its 200-day moving average.

If BP has better-than-expected 1Q18 earnings, its stock and 50-day moving average could rise. BP is expected to post its 1Q18 earnings on May 1.

Peers’ moving averages

Like BP, PetroChina’s (PTR) 50-day moving average is 2.9% above its 200-day moving average. ENI (E) and Suncor Energy’s (SU) 50-day moving averages are 4.9% and 0.7%, respectively, above their 200-day moving averages.

Now, we’ll discuss the SPDR Dow Jones Industrial Average ETF (DIA) and the SPDR S&P 500 ETF’s (SPY) moving averages. These ETFs represent the broad stock market and the overall economy, which includes diverse industries. SPY and DIA’s 50-day moving averages are 3.1% and 4.1% above their 200-day moving averages, respectively.

Next, we’ll discuss BP’s stock price range forecast before its 1Q18 earnings


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