re: why the "blow-off" for RIG:
My speculations:
1. someone knows something that you and I don't, and this is just the opening salvo. More blocks get dumped tomorrow, and RIG ends the week below 20. I'm being paranoid here, but I remember buying Intel last summer, as the stock went down and down and down, and then after the stock had bottomed, it came out the company had quietly been telling its big customers, for two weeks before they made it public, that their next big chip was going to be delayed.
2. A nervous holder decided that a major support line, at 25, had been broken, and wanted out. The stock had drifted just below 25, just before the block trade.
3. I see the high volume as a good thing. It means there are lots of buyers out there (like about half the posters on this thread) at this price.
4. Tomorrow, I think, is going to be a very volatile day for this stock. We're either going to: (A) rebound sharply, and re-establish support at 25, probably overshooting to 27 before drifting back to 25, or (B) continue the sharp downward movement, maybe gapping down, and it won't stop before 20, on even higher volume than today. I'm voting for (A), but that may be just wishful thinking, as I'm very long the stock.
5. No matter what happens tomorrow, this stock will be at much higher levels, when Brent has been at 18-20 $/B for a couple of months, and people start believing those prices are here to stay. RIG at 24 and Brent at 20 is a disconnect.
6. If the stock goes down further, I'm buying more. And I won't even think of lightening up until we're back to 31. |
