September 26, 2025

 

(DEEP DIVE INTO PHILLIPS 66 (PSX))

 

September 26, 2025

 

Hello everyone

 

I’m going to focus on an energy stock today – Phillips 66 (PSX).  The setup is looking good.  I will go through the chart picture and explain why it has grabbed my attention.

Firstly, I know the number of moving averages appears to be overkill.  But I have done that for a good reason.  I have the simple moving averages of the 20, 50, 100, 150, 200, 250, 300, 400, 500, and 600 (at the close).  On this weekly chart, they are all supporting the price action. 

Now, the two black arcs highlight what can be seen as a cup and handle formation.  The larger black arc shows the cup, and the smaller arc shows the handle.  If you measure from the base of the cup to the top of the cup (i.e. the resistance line I’ve drawn at the top), that is the measure of the projected target on the upside, which takes us to around $175.00.   

The strong divergence has been forming for around two years.  Mid-July 2023 to mid-July 2025 highlights the divergence pattern.  The longer the setup, the stronger the move.  The MACD is showing strength in momentum.

And On Balance Volume (OBV) has shown consistent strength. 

If you don’t own the stock, I would consider scaling in now. 

If you want to buy an ETF, you could consider the following.  PSX is a holding in both the XLE (Energy Select Sector SPDR ETF) and the XOP (SPDR S&P Oil & Gas Exploration & Production ETF).  Both ETFs have struggled in recent years, but the broader picture shows a promising setup for both. 

 

Phillips 66 Weekly chart ($136.59 close on September 24, 2025)

The (PSX) chart below was copied on Friday morning (my time).  As we can see, the stock has clearly broken through that resistance.  We should see more upside in the weeks and months ahead.  The Fib. Projections (taken on September 24) show potential price targets on the upside.

 

Phillips 66 (PSX) September 25, 2025, price @ $139.08

 

(XLE) Energy Select SPDR Fund

You can see that (XLE) has consolidated since 2022.  This consolidation may prove constructive, as a decisive push back above the high 90’s could trigger a momentum breakout, potentially carrying at the ETF above its prior peak from 2014. You will notice too that volume has shown consistent strength.

The (XOP) ETF remains well below its 2014 high, as well, but it has been tracing out what could be interpreted as a potential 10-year inverse head-and-shoulders pattern.  A breakout above the neckline at 160 would open a large “air pocket” of light resistance, which could take the stock up to the previous 2014 high.

 

(XOP) Weekly chart

The energy sector is slowly coming out of the quiet corner.  If Phillips 66 (PSX) can capitalise on the bullish patterns illustrated above, it could set a precedent for other energy stocks to follow.  And that kind of broad participation would also strengthen both ETF’s and help the energy sector regain a more resilient long-term up-trend.

 

 

Cheers

Jacquie