Heyward, welcome back. MTEL reported pretty good preliminary result. As to your GLM, the chart says it is trading no differently from NE and MDCO - failed to penetrate the upper BB and got bounced after two days of trying (Thursday and Friday). What that typically means is more selling pressure will ensue. GLM's short term support is at around $20 so you have some cushion left. Some bad news on GLM. NBR's Friday edition invited guest who bought GLM at 22 and sold at 32 said he still favors the oil drillers at this point but would not buy GLM but DO. Don't know his reasoning. My guess is the shallow vs deepwater differentiation.
How many birds?
On land drillers - with the surfacing of dayrate lowering news for the onshore rigs, I would switch land holdings to deepwater drillers. Not that they are not cheap in PE and other measures, just that this dark cloud is going to hover around for a while and can limit upside potential. As to their old highs, they were definitely inflated due to irrational exurberance (even the management admitted to that). I definitely don't count on their recovering to that level anytime soon, and cerainly lag the offshore drillers. Having said that, UTI, PTEN, BDI, GW, NBR have become the official dogs of the drillers. I would sell into strength and switch into offshores, particular the beaten down deepwater like RIG for continuing participation - just a risk/reward consideration, not TA. If one looks at TA, just look at UTI LONG stochastics:
207.95.154.130
The last 3 times it got that low, it rebounded. It will likely rebound as well in the next 2 days but the upside potential may not be as good. The fact that it dropped lower than its previous low is a risk. I have some UTI, will sell into strenth and switch into probably RIG or FLC depending on the relative price on the day. |
