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Strategies & Market Trends : Three Amigos Stock Thread -- Ignore unavailable to you. Want to Upgrade?

To: Sergio H who wrote (14467)	3/13/1999 1:02:00 PM
From: Phil Jacobson	Respond to of 29382

Sergio, The article you posted on oil is quite bearish. I believe technical factors are easily and quickly overturned by "real world" factors such as supply/demand. I think oil will quickly go back to the middle of its trading range and the interest in the sector will quickly dry up. The sector has seen several technical gyrations - look at late October to mid-November when the entire stock market was recovering and took oil along for the ride - temporarily. Oil fell hard right afterward because there was nothing to sustain it. A few well placed puts may be in order (SLB, HAL). I'm taking the short side of this one. Phil

To: Sergio H who wrote (14467)	3/13/1999 2:11:00 PM
From: James Strauss	Read Replies (1) \| Respond to of 29382

OIL Sector... Sergio: While fundamentals are similar (82 day crude supply), the Emerging markets are beginning to show improvement in their stock prices... This usually precedes an improvement in fundamentals... The Relative Strength line of the XOI is rising, and the line has moved through its 10 day and 50 day MA... This tells me that the XOI will most likely retest the old highs in the 480 area... That's about 11% from current levels... That's also prior to the OPEC cut of 2 million barrels of oil per day as the Emerging markets demand begins to pick up... Companies like RDC, HAL, and GLM were up during a down market day... This is the kind of positive Relative Strength I look for on down market days... A look at the weekly chart for RDC gives a broader perspective of the beginning of the up move... iqc.com Note the rising indicators... The fact that this is happening on the weekly chart underscores the building strength of this move... The daily chart shows why the weekly chart has rising indicators... iqc.com RDC is representative of most stocks in the Oil Services sector... As such, I have to let the technicals guide me ahead of the fundamentals... Caveat: I own RDC... Jim