Trading Idea - Is Chevron close to Resistance?

Published on Friday, 20 August 2010 05:08 Written by Christian Paolinetti

New York, August 20th (TradersHuddle.com) - Shares of Chevron Corp. (NYSE:CVX) are trading very close to calculated resistance at $79.19 with the current price action closing at just $75.84 placing the stock near levels that make it difficult to buy.

Chevron Corporation is an integrated energy company with operations in countries located around the world. The Company produces and transports crude oil and natural gas. Chevron also refines, markets, and distributes fuels as well as is involved in chemical operations, mining operations, power generation and energy services. Chevron, the second largest U.S. energy producer and formerly known as ChevronTexaco, was founded in 1879 and its based in San Ramon, CA.

Chevron's current stock range is defined by current calculated support defined at $66.83 and by the resistance level at $79.19, the stock is clearly over-extended from support, making it difficult to establishing new long positions at this level.

Traders don't have a clear entry point for Chevron, as the stock is well above support, however, as the stock pulls back towards $66.83 it will definitely provide a reference point to establish a trade. On the other hand if the stock decides to break above resistance level at $79.19 then traders will get an opportunity to enter Chevron stock by establishing a position as the stock moves to a higher range.