Mike,
Excellent post. I wholeheartedly agree with your viewpoint.
The Drillers have great fundamentals and for long term (>1 years) investors, you will be rewarded in all probability. May I point out one diminutive thing? There is a difference in how you approach things depending if you are a trader or an investor. When you start to mix up the time frame is when trouble begins. If you have limited capital, you are constrained to an extent on then number of shares you can hold while maintaining a reserve to protect yourself against a margin call.
Traders are less concerned about fundamentals and pay much closer attention to the current trading behavior of a stock as well as the prevailing market psychology. While an investor would be grinning now and accumulating the Drillers at these prices as many funds likely are, traders are shorting them. Any rally is stopped cold due in part to momentum traders bailing and traders shorting.
Right, wrong...good, bad? I have no idea. However, if you are a trader, you take what is given. If not, you won't be a trader for long!
Myself, I have a proclivity for trading. I have never been a believer in buy and hold. I think Dell is a great stock yet as Dell rose some 70 points, my gain was much more - some 90 points. This is because I traded it. I bailed when it dipped and bought back when it bottomed. This is true for FGII, EVI and a few other Drillers. FGII I admit is one that I have not capitulated on and have been buying as it has fallen. As many traders do, I only "trade" with a portion of my capital while the rest is socked away for the long haul. When I get to the point where I feel the need to liquidate my long term holdings, it often signals the bottom of a pullback.
On occasion I visit threads to try to ascertain the sentiment level. This is a particularly good group and I have both learned much from the postings as well as come to respect several people who post.
I will bow out now, but let me say thanks to all of you for your insightful and intelligent work. I truly hope that this correction is short lived and you are rewarded.
Roger Perry
The Right Line Split Report
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