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BP’s 50-Day and 200-Day Moving Averages in Q4 2018

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BP’s moving averages

In the previous part, we discussed that BP (BP) stock has fallen 18% in the fourth quarter. In this part, we’ll discuss BP’s moving averages in the fourth quarter.

In the fourth quarter, BP published strong third-quarter earnings due to strong upstream realizations. However, lower oil prices and weaker markets in the fourth quarter, which we discussed in the previous part, led to the fall in BP stock. The fall impacted BP’s 50-day moving average, which has fallen 5% in the fourth quarter.

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BP’s 50-day moving average has broken below its 200-day moving average in the fourth quarter. BP’s 50-day moving average, which was 1% above its 200-day moving average on October 1, is 4% below its 200-day moving average. Usually, when a shorter-term moving average breaks below a longer-term moving average, it’s considered as a technically bearish sign. Going forward, only a steep and consistent increase in BP stock could push its 50-day moving average above its 200-day moving average.

Peers’ moving averages

Total (TOT), Equinor (EQNR), and ENI’s (E) 50-day moving averages are 5%, 3%, and 6%, respectively, below their 200-day moving averages. Suncor Energy’s (SU) 50-day moving average is 10% below its 200-day moving average.

We’ll discuss the SPDR Dow Jones Industrial Average ETF (DIA) and the SPDR S&P 500 ETF’s (SPY) moving averages. DIA and SPY closely resemble the Dow Jones Industrial Average and the S&P 500 Index, respectively. While SPY’s 50-day moving average is 1% below its 200-day moving average, DIA’s 50-day moving average is equal to its 200-day moving average.

Next, we’ll estimate BP’s stock price range until December 31.

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