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MPC, VLO, PSX: What Technical Levels Suggest

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Refining stocks in Q1 2019

In Q1 2019, Marathon Petroleum (MPC), Valero Energy (VLO), and Phillips 66 (PSX) stocks rose, while HollyFrontier (HFC) stock fell. The varied returns were primarily due to mixed cues in refining margin indicators of these companies.

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Moving average trends in Q1 2019

At the beginning of the first quarter, VLO and PSX’s 50 DMAs (day moving average) stood way lower than their 200 DMAs. As the quarter progressed, these refining stocks and their 50 DMAs rose. Notably, their 50 DMAs moved closer to their 200 DMAs. When short-term moving averages move closer to the long-term moving averages, it could result in a cross-over, which is a bullish technical sign.

Valero’s 50 DMA, which stood 22.0% below its 200 DMA on January 2, stood 12.7% below its 200 DMA on March 29. This was led by a 2.7% rise in VLO’s 50 DMA. Similarly, Phillips 66’s 50 DMA rose by 2.5% in the quarter. The gap between PSX’s DMAs narrowed from 13.7% to 7.4%. Also, MPC’s 50 DMA moved closer to its 200 DMA. On March 29, MPC’s 50 DMA stood 10.5% below its 200 DMA.

However, the fall in HollyFrontier’s stock led to a 10.3% fall in its 50 DMA, which widened the gap between both its DMAs. HFC’s 50 DMA, which stood 9.3% below its 200 DMA on January 2, stood 14.3% below its 200 DMA on March 29.

Thus, VLO, PSX, and MPC’s moving averages show improvement. But HFC’s moving averages point at technical bearishness in the stock.

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