Despite recent gains in energy prices, it has been a difficult year for integrated oil giant Chevron (CVX) relative to other stocks this year. CVX exited the green zone of the SIA S&P 100 Index Report back in March and dipped into the red zone over the summer. Although it did manage to rebound for a few weeks in the late summer, for the last month, CVX has been drifting back down toward the bottom of the Yellow Neutral Zone finishing yesterday in 51st place down 7 spots on the day and down 20 positions in the last month with the share price down 14.6% over that time.
Investor sentiment appears to have soured toward Chevron due to a combination of a weak recent earnings reports and the company taking on risks (transaction and integration) related to its planned purchase of Hess Corp. Interestingly, competitor ExxonMobil (XOM), who also is working on a major acquisition (Pioneer Natural) is still in the Green Favored Zone. Meanwhile, ConocoPhililips (COP), who has not announced a recent acquisition, is down only 2.6% in the last month, has a bullish SMAX score of 10 and is up near the top of the Green Favored Zone holding steady in 5th place, up 5 spots in the last month. A major breakdown is underway in Chevron (CVX) shares. Back in September, an Ascending Triangle breakout above $170.00 failed to gain traction, ending in a throwover bearish Bull Trap instead. Last month, $170.00 was re-established as resistance and since then the bottom has really started to fall out from under CVX.
In recent weeks, CVX has staged two breakaway gaps downward, taken out both its 50 and 200-day moving averages and snapped a previous uptrend support line. All of these recent declines and bearish signals have happened on rising volume, a sign of increased selling pressure.
Next potential downside support appears at previous lows in the $125.00 to $135.00 area. Initial resistance has dropped to the $150.00 round number.
Chevron (CVX) shares have spent most of this year digesting and then giving back some of the gains previously made in a late-2022 rally. A summer bounce ended in a bearish Bull Trip where CVX broke out by one row and then rolled back down, completing a lower high in the process.
Recently, the shares have continued to trend downward completing a bearish Triple Bottom downward and have started November trading at their lowest levels in a year. Initial downside support appears in the $128.95 to $134.20 area where two previous lows and a horizontal count cluster, followed by a long-term 45-degree uptrend line and a previous breakout point near $103.50. Initial resistance on a bounce may appear near $157.25 based on a 3-box reversal.
With its bearish SMAX score falling to 2, CVX is exhibiting weakness against the asset classes.
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