Listed within the Dow Jones Industrial Average, Chevron Corporation (CVX) is one of the world’s largest integrated energy companies, closely tied to global oil market dynamics. Originally removed from the DJIA in 1999 and re-added in 2008, Chevron remains a bellwether for the energy sector. Due to its dependence on crude prices, the company’s performance often mirrors the broader oil cycle; when oil prices bottomed in 2020, CVX reached a low near $43 per share. Geopolitical developments have introduced renewed uncertainty. Tensions between the United States and Venezuela—one of Chevron’s crude suppliers—intensified earlier this year after President Trump revoked Chevron’s license to operate in the Venezuelan oil sector and imposed a 25% tariff on goods from countries purchasing Venezuelan oil or gas. These measures added pressure to the global oil supply chain. Despite these headwinds, and with the license issue now resolved, Chevron posted strong quarterly results today, exceeding earnings estimates as profits from its $53 billion Hess Corp. acquisition boosted production and cash flow. A key aspect of this acquisition is Hess’s 30% stake in the Stabroek oil block off the coast of Guyana, a region bordering Venezuela, with which Guyana continues to dispute oil rights. From a technical perspective, the relative SMAX currently sits at 4 out of 10, reflecting a declining trend within the Dow Jones Industrial Average since early 2023. The candlestick chart supports this view, showing choppy price action near the highs as CVX trades within a narrowing range. Trading volume has declined from prior breakout levels. For a breakout to occur, several indicators would need to align. The SMAX score would need to strengthen further—having risen from 0 in July to 4 currently, it has shown early signs of improvement—and trading volume would need to increase, as the year-over-year decline suggests limited institutional participation. Sustained higher volume near previous highs would likely be necessary to overcome resistance, where supply has historically curtailed breakout attempts.
The Point & Figure chart highlights Chevron’s long-term recovery from the 2020 lows. This rally primarily unfolded while CVX remained in the SIA Unfavoured Zone, only entering the Favoured Zone after breaking above the key $96 resistance level. At present, P&F analysis shows the stock consolidating near a critical support area around $147. A breakdown below this level could expose downside targets near $130.54 and $118.23. On the upside, resistance zones are identified near $162.30, followed by the all-time high at $168.86, with further potential toward $201.81 if momentum extends into new territory. The final support at $118.23 aligns with the long-term trendline supporting the current uptrend. If this level fails, there is no significant support until the prior breakout at $96, introducing potential for substantial downside movement. Since the earnings report, price has traded to a daily high of $158.86—slightly below the first resistance level of $162.30. At this time, CVX does not show strong performance indicators. Increased investor interest combined with dynamic political developments could influence its future trajectory. As one of the largest companies in the energy sector, CVX might serve as a useful proxy for trends among smaller industry peers.
Disclaimer: SIACharts Inc. specifically represents that it does not give investment advice or advocate the purchase or sale of any security or investment whatsoever. This information has been prepared without regard to any particular investors investment objectives, financial situation, and needs. None of the information contained in this document constitutes an offer to sell or the solicitation of an offer to buy any security or other investment or an offer to provide investment services of any kind. As such, advisors and their clients should not act on any recommendation (express or implied) or information in this report without obtaining specific advice in relation to their accounts and should not rely on information herein as the primary basis for their investment decisions. Information contained herein is based on data obtained from recognized statistical services, issuer reports or communications, or other sources, believed to be reliable. SIACharts Inc. nor its third party content providers make any representations or warranties or take any responsibility as to the accuracy or completeness of any recommendation or information contained herein and shall not be liable for any errors, inaccuracies or delays in content, or for any actions taken in reliance thereon. Any statements nonfactual in nature constitute only current opinions, which are subject to change without notice.
