Strictly: Drilling and oil-field services Message Board

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Gold/Mining/Energy : Strictly: Drilling and oil-field services

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To: otter who wrote (68012)	6/11/2000 5:00:00 PM
From: double-plus-good	Read Replies (1) of 95453

otter; i tend towards being a little overly bearish, but i feel compelled to chip in with my 2 cents. i concur with the recent cautionary words of bullsky here. while most of us here are expecting a great deal more from the sector based on our extensive fundamental research and the drawdown on reserves and very low levels of domestic production... ...i, for one, am not particularly enthralled with the chart patterns we are showing in the osx and its stocks. there is a great deal of uncertainty expressed there and many drillers have cracked their 50 dma support levels and will have a lot of trouble getting past them. there are bearish divergences in most of the recent highs; the bull has apparently fled our little sector for now. on the one hand we have a lot of money leaving for the "easy" money in the snap-back in the speculative issues; on the other hand the smart money seems more than a little concerned that the "slowdown" which has the daytraders so pumped up may be the start of something a lot more serious. IMO the worst thing that could happen is to have OPEC unleash more supply into the face of a US economic slowdown /possible recession. that could quickly end the bull in oil prices, which we all know by now is dependent in part on the futures traders interpretation of data sets. the sentiment can change quickly. so while i tend to think that this osx run/cycle has not seen its highs, i also think the path will not be as clear and direct as it was in the 97-98 run. my personal gut feel is that we are going to fail out of some rally attempt soon and go into a consolidation phase between 90-110 and possibly lower. in other words i think we are going to have a significant pause with weak momentum and relatively poor performance for some time until the fundamnetals are fully supportive of the expanded valuations on the OSX stocks. i don't see a collapse here just nothing very spectacular to look forward to. here's an OSX chart with the MA's. 207.61.23.98 note that after dipping below the 50 day we are now precariously perched right at that support. if we can't get a decent rally started here shortly and do head south for a second time i will be selling most of my remaining positions until either the upward direction has resumed or prices are too cheap to ignore. one quick note. the last time i was as concerned with the near term direction was as i was pointing out a possible head and shoulder around osx 87 in november. we shortly proceeded to rally impressively. so i hope my worries are similarly responded to this time around. here's an interesting news item re: the pricing of NG. it is killing the margins in a number of chemical concerns. biz.yahoo.com i don't see how NG can't help but come in from this price run. nothing goes straight up. so i have a cautious view of the enp's which i think will also back off their highs for a rest or maybe more. anyway lets hope my pessimism does the trick and we turn and run to osx 140. re: falcon; she looks better than most of the others and the money flow is strong, but i think i spy a bear flag on the daily. big poppa SLB has been not so strong latley and where SLB goes the rest surely follow. ++

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