Jantastic...Thanks for your birthday good wishes. I did some work on Cliffs Drilling this morning as well as a little study of the movement of the Oil Service Group Bullish %. I know that you have an interest in the sector and your thoughts and help would be most appreciated.
I ran a check of the Insidertrader.com database and was disappointed to see only one buy of CDG stock by an insider in the last year (August 14, 1997-1,000 shares at $47 1/2). 10 sellers. Some insider buys would bolster confidence that insiders perceived a bottom was near, but nothing doing.
One has to go back to the May-June time frame in 1996 to find where Cliffs was trading at these low levels. At that time, the stock was consolidating an advance from $14 1/2 in Feb '96 that moved the stock as high as $34 before a retreat to $26. I wonder if anyone reading this board has access to the price of oil and what it was trading at in the summer of '96 and what the price eventually moved to by January '97? I'm interested to see how CDG responded to the movement in oil and how closely the stock tracked the commodity.
A study of the movement of oil service group is quite revealing. During the summer of '96, the oil service group corrected to where 50% of the stocks had bullish chart patterns by August, down from 82% in May. The oil service group turned around in September and eventually, almost all oil service stocks had joined the party as the number of bullish chart patterns had reached 80% by January '97. The group peaked in Novemeber of last year, also at 80%, and it's been in freefall since, with the exception of a strong recovery that started in February '98. This recovery in the February-May '98 time period occurred after the group reached a 5 year low of only 14% of the stocks showing bullish chart patterns. That number reached a peak of 64% in May and the group is currently at 24% and will surely be lower when the Oil Service Bullish % reading is computed next week. I would greatly appreciate a reader of the board responding to this post by posting the price of oil that tracks the time periods I highlighted in this post.
The key for Cliff's and the group is when a 6% turn in the number of bullish chart patterns takes place. Reversals from under 30% as we well know, portend a good trading move at a minimum and place groups in "Bull Alert" status. At that point, all who wanted to sell have sold and there is great buying power on the sidelines that will fuel an advance. The reversal has to take place, however, and it's dangerous to anticipate when that might occur.
Janerific, do the DWA box seats have a p&f long term chart for the price of oil? I would love to see it.
Your pal,
Bruce |
