Chevron shares are at a critical juncture before it delivers a fourth-quarter update after the market closes today.
CVX recently hit new 52-week highs but has since turned lower and broken its 10-day moving average. On the daily chart below, that moving average is shown in blue.
The key area to watch, however, is the series of tops that the stock has hit in the last year. The red horizontal line shows that the $110 area is a major level from both a bullish and bearish perspective.
For bears, the latest move down lower may be an attractive inflection point for a trade because the shares have a history of drifting lower after hitting resistance and falling back. For bulls, the prospect of a breakout above resistance which has been tested several times, could be good news.
When a resistance level has been hit many times, breaks above that level can lead to very strong rallies. CVX is trading at $108.08 this afternoon, off 0.9 percent on the day.
The company is scheduled to give a fourth-quarter interim update at 5 p.m. ET today. Management will issue the official earnings report for the quarter on Jan. 27.
(Chart data provided by Thomson Reuters)
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