This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Cramer's Action Alerts PLUS - See his portfolio and get alerts BEFORE every trade. Learn more NOW!

Technical Outlook: Refiners May Be Bottoming

Tesoro (TSO - Get Report) has been in a in a steady downtrend over the past eight months, but that might be changing as the price has started to consolidate and move sideways in the last two months. After a stock takes a dramatic drop, such as Tesoro has done, it takes time for the process to reverse. If the price breaks above $20 on increasing volume, it may be a signal that the downtrend has ended.

The second barrier is the resistance level around $30, which could send the price back down to test the $20 support area. If that happens, and the price holds, it could be a good time to add to positions. The bottom of the chart shows that the money stream has started to break out of its range and lead the price higher.

TSO
Click here for larger image.
Source: TC2000

Valero Energy (VLO - Get Report) is also trading in a sideways consolidation pattern and may be in the process of building up enough steam to move higher. However, the red trend lines indicate that the stock needs to break through quite a bit of resistance before the primary trend can change from down to up.

If that does happen, investors will want to see a sharp increase in volume along with the institutional money stream at the bottom of the chart moving higher to confirm the breakout.

VLO
Click here for larger image.
Source: TC2000

When stocks begin to form a bottom, it takes time for them to work their way through the resistance levels that have been built during the prior downtrend. Action can be choppy until the momentum builds up. The key of course is to keep protective sell-stops under the bottom of the trading range in case the stocks resume their prior downtrend.

At time of publication, Manning had no positions in stocks mentioned, although holdings can change at any time.

Mark Manning, AAMS, is an Accredited Asset Management Specialist and Registered Investment Advisor with Butler, Wick & Co., where he specializes in wealth management. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Manning appreciates your feedback; click here to send him an email.

2 of 2

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Try it NOW
Only $9.95
Try it NOW
14-Days Free
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
SYM TRADE IT LAST %CHG
TSO $91.04 0.31%
VLO $60.08 2.40%
AAPL $129.36 0.21%
FB $79.60 -0.19%
GOOG $573.64 0.40%

Markets

DOW 18,203.37 -85.26 -0.47%
S&P 500 2,107.78 -9.61 -0.45%
NASDAQ 4,979.9010 -28.1950 -0.56%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs