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Gold/Mining/Energy : Strictly: Drilling and oil-field services -- Ignore unavailable to you. Want to Upgrade?

To: Elmer who wrote (27782)	8/14/1998 10:00:00 PM
From: Grommit	Respond to of 95453

What signals are you waiting for and were any of these signals present in March but ended up being wrong? Watch the fundamentals not the stock prices. Watch oil prices, oil inventory, rig count, asia demand, dayrates and all the rest. Some institution may move "early", before the sector fundamentals change, but so what. In that case you buy not at rock bottom. The other risk is that the fundamentals change on you. You buy then get nailed. You see oil prices move up, only to come back down for one reason or another. But that head fake is less likely than a head fake from watching only stock prices, and buying when the ticker moves up a notch. Take a nap until fall.

To: Elmer who wrote (27782)	8/15/1998 12:02:00 AM
From: papi riqui	Read Replies (1) \| Respond to of 95453

Elmer, You raised some good points, especially about the March rally. As I said, I was too chicken and too late to take advantage of it. It's not that I did or did not call the March bottom, far from it, I simply lacked the necessary conviction about the market to commit funds at the time. In retrospect, it is clear that March was indeed a short term bottom and many people made good profits buying it. I wish I had. But by late April/early May it also was clear that the rally had run its course and the sector (and the market) had again turned negative. You would agree, I'm sure, that it has remained negative since then with no sign of a turnaround. As far as me trying to call the bottom, trust me, I wouldn't know one if I fell out of bed on it. But I do know that in a freefalling market it's nuts to buy any stock simply because it has fallen to seemingly absurd levels and then remained flat for a day or 2 or perhaps had a 1 or 2 day rally. That's just gambling on a hunch, pure and simple. It may be that now really is the time to buy. I haven't a clue. But I'm not buying it until the market tells me that it's time to do so. That won't be at the next bottom because I don't think you can really know when the bottom has occurred until after the fact. How will the market tell me that? When there are more buyers than sellers, i.e., when these stocks start giving buy signals. As of now, every last one of 'em are on sell signals and have been for quite a while. It's sorta like crossing the intersection on the green light. Doesn't guarantee a safe crossing, but it's less risky than crossing against the red. You may want to take a glance at the P&F thread if you're interested in this line of thought. I don't believe anything or anyone can tell you where the market is going, but I find P&F very helpful in understanding where the market stands now.

To: Elmer who wrote (27782)	8/15/1998 12:48:00 AM
From: SliderOnTheBlack	Respond to of 95453

Actually papi riqui presents the most ''sane'' bearish arguement yet... I respectfully disagree for reasons all ready posted; but this is an intelligent well thought out & valid point. Once again; I have no arguement with the conservative stance of being in cash and/or waiting here... I just believe that there is immediate upside and tremendous opportunity here right NOW. Too much cash being generated by these ''new'' companies. The BHI or GLM of today is certainly not the same animal of 10-15 years ago; neither are the dynamics of the market. PE and cash flow valuations have changed, the deepwater factor is different, the technologies are different, the cost of bring a barrell out of the ground when indexed for inflation etc... But one can not make an informed decision without realizing the "flip-side''... PSS: Mike from La. ??? <<"When stocks get hammered because of a long-term change in fundamentals it usually pays to take your lumps and sell. But when stocks get hammered because of a short term change in fundamentals that don't affect the long term, it's a buying opportunity. And if the short-term negatives actually improve the long-term picture, you have an extradinary buying opportunity. That's the case today with oil services and drilling companies..... ... in the next two to three years most if not all stocks in the group will well surpass their previous highs. This means for the very leveraged drillers .... targets four or even five times the current prices are realistic.>> IMHO: Truer words have not been spoken.... if you think this guy is a ''clown'' then simply short the sector... To me- the essence here is exactly the single most important point -- a ''short term change'' in crude prices that does NOT change the long term fundamentals of the oil service & driller companies... History if filled with examples of taking advantage of a ''10 year low'' - in this case crude prices ...pick out virtually any commodity, any sector, any niche and buy at a ''10 year low'' and I think you will on average find some pretty nice returns....