Stock Analysis | Occidental Petroleum Outlook - A Weak Technical Profile Amid Mixed Market Signals

Occidental Petroleum Outlook - A Weak Technical Profile Amid Mixed Market Signals

Market Snapshot: The technical outlook for OXY is bearish with an internal diagnostic score (0-10) of 2.22, suggesting investors should proceed with caution in the near term.

News Highlights

• Colombia oil and gas investment to rise 8% in 2025 (May 29):
• Colombia's E&P investment is expected to jump to $4.68 billion. While not directly linked to OXY, this highlights global momentum in the upstream oil sector.

Tinubu introduces new executive order to boost Nigeria's oil and gas sector (May 31):

• President Tinubu’s order is aimed at reducing project costs and attracting investment, offering potential long-term tailwinds for global oil producers like OXY.

OPEC+ set to hike oil output by more than 411,000 bpd in July (May 31):

• This global production boost could add downward pressure on oil prices, which could indirectly weigh on OXY’s share price.

Analyst Views & Fundamentals

Three analysts have issued ratings over the past 20 days, all of which are Neutral, with a simple average rating score of 3.00 and a weighted average of 2.73 (based on historical performance).

• James West (Melius Research): Historical win rate of 100.00%, with an average return of 3.70%.
• Josh Silverstein (UBS): Historical win rate of 71.43%, with an average return of -0.49%.
• Devin J Mcdermott (Morgan Stanley): Historical win rate of 50.00%, with an average return of -9.25%.

Though the consensus is neutral, the current price trend is a modest 0.17% rise, which is not aligned with the neutral market expectations. This suggests the market is waiting for more definitive signals.

Money-Flow Trends

The fund-flow analysis shows a mixed picture:

• Big-money (block) inflow ratio: 49.48% — trend is negative.
• Large and extra-large investor inflow ratios: 49.92% and 49.27%, respectively — both negative trends.
• Small investor inflow ratio: 50.55% — trend is positive.

This signals that big institutional investors are pulling back, while retail investors are cautiously stepping in. The fund-flow score of 7.89 (good) suggests the market may not yet be fully bearish, but caution is warranted.

Key Technical Signals

The technical analysis paints a weak picture for OXY over the past five days:

• Williams %R Overbought: 3.22 internal diagnostic score. Historically, this signal has a 51.61% win rate with an average return of -4.00%.
• RSI Overbought: 2.00 score. This has a 41.67% win rate and an average return of -7.00%.
• Bullish Engulfing: 1.44 score — a bearish signal despite the name. This has a 37.50% win rate and an average return of -8.40%.

Recent Chart Activity: Over the last five trading days, multiple overbought indicators have appeared, including the Williams %R and RSI. These signals, while common, suggest a market that may be overextended and due for a correction.

The key insight: 3 bearish vs. 0 bullish indicators indicate a strong downward bias. The overall technical score of 2.22 (weak) reinforces the idea that the stock is in a vulnerable technical position.

Conclusion

Investors should consider waiting for a pull-back before initiating new positions in OXY. While there are some positive macro developments in the oil sector, the internal diagnostic technical score of 2.22 and the mixed fund-flow signals suggest that the near-term outlook is not favorable.

Watch for: Further technical deterioration, changes in OPEC+ output decisions, and potential reactions from large institutional investors. For now, the risk-reward balance is not clearly in favor of the bulls.