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

To: RGinPG who wrote (31404)	11/3/1998 12:54:00 PM
From: SliderOnTheBlack	Read Replies (1) \| Respond to of 95453

RGinPG; stochastics and the prior run-ups... Ron; I think overall that the stochastics are a good tool; I like to use them to indicate a buy better than a sell. I think you agree that on a substantial move upward, they give too early of a sell signal. I agree with you on the fundamentals - no arguement there. But, we are still so cheap; in comparison to the general market; that this massive inflow of cash has to go somewhere and this is still one of the better values sectorwise. Fund managers are going to be pressured to participate here; if they sat out the beginning of this total market recovery & bounce; they allmost ''have'' to be in in case they miss a major move. With both International & Fed rate cuts still coming; I think one has to view this as a unique market enviroment. I say; one has to be here untill proven otherwise... The one VERY BIG ''cavaet'' however; is one HAS to ve vigilant and be quick; and most importantly - be willing to take some or even ALL of your chips of the table if we see bad OPEC news or a big retracement starting... The upside still far overshadows the downside; most all of the Oilpatch stocks are still available at prices that make sense on a long term hold basis. We are NOT in the same situation as last May-June when we were falling from out highs looking for support... Obviously this left a very ''gun-shy'' attitude with many; me included, but that was then & this is now...<VBG>. Another key; is how one enters here. I would preferably buy on dips; like OMNI's blowoff after it's earnings release - this was a classic - lost big revenue due to GOM storms & International Expansion; PKD as well; TCMS as a laggard etc. Buy on dips or average in in 2-3-4 buys spaced days or weeks apart...reading the market trend both technically and watching the fundamentals of Crude Prices - OPEC news, Rig utilization, Day Rates etc. Don't buy on a rally or even necessarially here today... pick you openings. If we were at last May's price levels - this would be another story all together. But, these runs are hard to come by of late - one has to participate as long as this enviroment exists - imho. But, be ready to leave quickly. We could see a big move off of positive OPEC news and if the supply numbers come in better than expected & the Fed Cuts and we get some crude short covering - all of this is highly possible; if it happens - another 15-25% up from here is very, very possible. Keyword- possible; not a sure thing by any stretch. But, to not position for this; is to miss an entire MAJOR MOVE ! Remember; there is no such thing - as ''cheap Oilpatch stocks - with strong fundamentals''; one has to enter somewhere before the fundamentals are clearly ''strong'' or you'll be buying FGII at $26-30, RIG RON $50 + imho; cant have $18 crude, solid dayrates, 95% Rig Utilization and cheap stocks ! - wishfull thinking, but doesn't exist. You have to enter somewhere; we're seeing some early indicators of Asian recovery, Fed & International rate cuts and we have momenteum ...