VLO is overbought; technicals imply a drop to $350.

But this stock we're looking at is on Valero. Now, let me back out to show you really how I've been drawing uh the progress and monitoring the progress technically on this chart.

So, you can see here I've got two parallels. The first one's the blue parallel started all the way back in October of 2020 that contained price all the way up here until March of this year.

And if you guys recall, right around the end of February, beginning of March, the United States invaded Venezuela and then we attacked Iran. And then obviously with the big Iran attack, there has been an explosion as far as increase in cost of oil.

But Valero has staged itself to really benefit as their refineries can already accommodate the crude coming from Venezuela. Much that we already um as far as the United States is already um uh acquired.

So VLOO has just continued to push up on the charts.

Now what I did to gauge where this next level of resistance would be, I started a parallel and I drew it within the price action on the previous parallel after price had broken out, retraced and bounced much like I go through on trading the close.

Anyway, back to the analysis on this bounce that's occurring. So, we bounced through that parallel and then retraced and has since come back up. Even notice here on the 50% area, we paused, retraced, broke out, retraced again, and then bounced.

Much like I described, guys, these happen over and over again, illustrating we were going higher.

Now, why has price put on the brakes right here over the last four trading days? Well, it's because of this inclining parallel channel. Now, it didn't even get to $400. One could argue, hey, Drew, it's it's stalling out there because of the $400 whole round number.

You could be right, but price didn't pierce that area mainly because it couldn't get there because of this resistance.

And since we're seeing price come back down now, uh, a positive for price to come come down further on VLOO is if we put a daily close lower than this low pivot that occurred on September 9th, which is at $37,959.

We have a daily close underneath that level, that increases probabilities vo to come down to the next level right around $350 as the next key level of near-term support.

But look at the RSI, guys. near overbought just coming down under 70 right now under 68. This too by the way the RSI is the relative strength indicators located at the bottom of the screen that you see when I flip to the weekly look at we're at 75.76.

Flip over to the monthly we're at 86.49 49 both monthly and weekly still remaining overbought near-term still implying that we do need to see further downside on the chart of via low that should uh correspond sooner rather than later on that chart.