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Analyzing Marathon Petroleum’s Moving Averages

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Marathon Petroleum’s moving averages

In this part, we’ll discuss the trend in Marathon Petroleum’s (MPC) moving averages in the first quarter. First, we’ll see how Marathon Petroleum’s moving averages trended in the past few quarters.

In the second quarter of 2018, Marathon Petroleum stock fell after the company announced the Andeavor acquisition. In the third quarter of 2018, since the acquisition progressed as expected, Marathon Petroleum stock and its 50-day moving average rose.

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The trend reversed in the fourth quarter of 2018. Marathon Petroleum stock and the 50-day moving average fell sharply due to weaker refining cracks and lower-than-expected third-quarter numbers. Marathon Petroleum’s 50-day moving average broke below its 200-day moving average in the fourth quarter. Usually, when a shorter-term moving average breaks below a longer-term moving average, it’s viewed as a technically bearish sign.

First quarter

Marathon Petroleum stock has risen 4% in the first quarter. However, weakness in the stock in the previous quarter impacted Marathon Petroleum’s 200-day moving average. So far, the stock’s 200-day moving average has fallen 4% in the first quarter. The decline narrowed the gap between the stock’s 50-day moving average and 200-day moving average. Marathon Petroleum’s 50-day moving average, which was 14% below its 200-day moving average on January 2, is 11% below its 200-day moving average.

Going forward, Marathon Petroleum’s earnings and cash flows are expected to rise as the integration of Andeavor progresses. The rise could have a positive impact on Marathon Petroleum stock and its 50-day moving average.

Phillips 66 (PSX), HollyFrontier (HFC), and Delek US Holdings’s (DK) 50-day moving averages are 9%, 15%, and 20%, respectively, below their 200-day moving averages.

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