Moving Average Analysis of FEZ’s Oil and Gas Industry
Global Markets Ring in the New Year with Dreadful Results
FEZ’s oil and gas industry
The SPDR Euro STOXX 50 ETF’s (FEZ) oil and gas industry had a return of -7.2% in the week ended January 8, 2016. Oil and gas stocks such as Total (TOT), Repsol, and ENI (EAA) returned -9.5%, -11.7%, and -7.9%, respectively, that week.
The increasing conflict in the Middle East and the slowdown in China’s economic activity are the major reasons for the fall in crude oil prices. If these types of geopolitical issues continue, then crude oil could hit new lows in the future.
The continuous fall in oil prices is leading to losses for major integrated oil and gas companies. Their stock prices have been falling drastically. Now let’s analyze their performances by using the moving average.
Moving averages
Total is trading 13% below its 100-day moving average, 15% below its 50-day moving average, and 10% below its 20-day moving average.
Repsol is trading 22% below its 100-day moving average, 19% below its 50-day moving average, and 14% below its 20-day moving average.
ENI is trading 13% below its 100-day moving average, 10% below its 50-day moving average, and 6% below its 20-day moving average.
All the major oil and gas companies of FEZ are trading below their moving averages, which indicates they’re not able to cross their short-term moving averages and are headed toward a downtrend.
To confirm an upward movement, they need to cross their short-term moving averages.
The United States Oil ETF (USO) is also trading below its 100-day and 50-day moving averages. Major US integrated oil and gas stocks such as Exxon Mobil (XOM), Chevron (CVX), and Occidental (OXY) are trading below their 100-day and 50-day moving averages.
Analysts’ estimates
Analysts’ estimates suggest an upside of 27%, 50%, and 24% for Total, Repsol, and ENI, respectively, over the next 12-month period from the current levels as of January 8, 2016.
To learn more, read Geopolitical Tension and Low Oil Prices Weigh on European Market.
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