Valero Energy Corp (NYSE:VLO) shares are rising on Wednesday following reports that Venezuelan oil sanctions will be eased and shipments to the U.S. will resume and continue indefinitely.
What Happened: A senior Trump administration official told Reuters that Venezuelan oil sales to the United States will begin immediately, with the initial shipment being between 30 million and 50 million barrels, and will continue on an ongoing basis.
On Tuesday, President Donald Trump presented a plan to refine and sell up to 50 million barrels of Venezuelan crude that had been originally stranded under the U.S. blockade.
According to the official, the U.S. will selectively ease sanctions to support the flow of Venezuelan crude and refined products into global markets. Much of the oil now headed to the U.S. would have been exported to China.
Technical Analysis: Valero Energy is currently showing strong bullish momentum, trading well above its key moving averages. The stock is positioned 9.6% above its 20-day SMA, 6.9% above its 50-day SMA and 11.5% above its 100-day SMA, indicating a solid upward trend.
With an RSI of 62.94, the stock is in neutral territory, suggesting that while it has room to run, it's not yet in overbought conditions. This level indicates that momentum is healthy but traders should watch for any signs of a pullback as it approaches overbought territory.
The MACD is above its signal line, signaling bullish momentum and suggesting that the current uptrend may continue. Traders should keep an eye on this indicator for any shifts that could suggest a weakening trend.
Key support is at $168.50, while resistance is at $185.50. If the stock tests the support level, it could signal a potential reversal, while a breach of resistance may lead to further upside.
The golden cross in July, when the 50-day SMA crossed above the 200-day SMA, indicates a strong bullish trend. This crossover often signifies the beginning of a sustained upward movement, which aligns with the current price action.
Over the last 12 months, Valero has gained 48.44%, reflecting strong performance and investor confidence. This long-term trend reinforces the bullish outlook and suggests that the stock has been in a solid uptrend.
Currently, Valero is trading near its 52-week high of $185.62, which shows it is performing well within its range. This positioning indicates strong demand and suggests that traders are optimistic about its future performance.
VLO Price Action: Valero Energy shares were up 3.39% at $184.32 at the time of publication on Wednesday, according to Benzinga Pro.
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