so far it's holding near the sept. oct. consolidation highs on the daily chart, and also potentially making a double bottom intraday here....good spot for a rally....not sure yet because are there still people wanting to unload more? not sure....leaning toward thinking in general that we're at or not far from the lows that will be the lows for all of december. good luck, bits.
the shares in esv had already fallen 10% from last months highs before today's drubbing....classic overdone. I loaded the boat just now pretty close to the lows....about 2k shares plus I sold January 55 puts @ 1.15
I think that this will prove to be the "puke" today. the process goes like this: weakness in the stock, everyone sees it and the concerns get priced in the stock as it goes lower and underperforms the general market. then an analyst comes out and says what most people have already know and been concerned about for weeks. you get the high volume selloff "puke" and that marks the bottom. we'll see if I'm right, but I am putting my money where my mouth is.
Bloomberg has an article about it. Just read it, and it won't be until late 2014 that the first contracts with Mexico by foreign firms comes to fruition. So this is a longterm benefit that starts effecting revenues in 2015.
Mexico congress just voted Yes to allowing foreign investment in Oil. This is good for NE as they do a lot of business with Mexico in the Gulf. This midday rally seems to have occured as this news came out, but I think this Yes vote was expected. Well, not complaining, let it rip.
RIG and ESV each stacked a rig, and Petrobras terminated a contract early that it had with RIG. I think there is general nervousness in the investment community concerning strength of the offshore market going into next year. But there is plenty of evidence of a strong market. It might end up being a situation in which strong markets for say high spec rigs balance out weakness for say older rigs. We're now at that point though where risk/reward considerations kick in and people feel these stocks are a Buy because the bad news is priced in and any good news could take us pretty far.
now i bought some @ 36.61....added 20% to my position there. I think it will hold around hear judging by the 1 year chart where we have support at the 3 month lows in Sept. and on the weekly chart there is general support at this level with selling below this level being bought. I have seen some negative sentiment on the group lately with one stacked rig and one rig where a contract (I believe by Petrobras) was cancelled early. I had just skimmed the particular article from an analyst, but I believe this came from RIG and ESV. I'll check later and post what they said....but the analyst did not believe that this signalled the end of a cycle at all it sounded like he believed it was isolated cases.
I didn't buy more yet. Two reasons:
1. I already bought more than I (apparently) should have at 38.
2. It felt like a strong trend down in the morning, and often it is best to just wait it out and see how it closes. Closing on the lows is usually not the greatest sign....so I figured just see what it does in the first hour tomorrow.
You can read the seeking alpha article that is currently 5 stories down on Yahoo's NE page. It also gives NE's statement on why they are doing it. My personal take is kind of neutral on it. NE management says it's so that NE and Spinoff Company can each focus on what they do best. Yawn....you have all kinds of public companies that have multiple divisions and they have a division head who focuses on his particular division. Say like GE which has tons of divisions that are completely unrelated. Anyway, it would remain to be seen just how much benefit is accrued by 2 separate companies. I don't think it's a negative though because contracts are still contracts...it's not like they will loose any revenues....although they'll have associated costs to doing the spinoff. I don't know....just my quick take....there are people here who understand the company and industry much better than I do, I just don't see the spinoff really impacting the stock price if everything else is going well.
The chart looks bullish to me,petro.....esp. on a weekly chart where we had that nice rally above 40 on good volume and then declining volume each week after that as the stock went lower. Also on the weekly chart we have good support at 37. This chart looks to me like a long consolidation (long is good) that is ready to rally. If you add this technical setup to the fact that for now there is nothing fundamentally that would indicate that world economies are contracting, and then add to that the traditional seasonal rally in the first quarter, and then add to that increasing revenues through 2014, I think this is a really nice risk/reward setup at a time when investors attention is elsewhere. This is why I am planning on a large position. I've also bought stock today, still with plenty of dry powder to buy more. By the way, the longer the consolidation, the more likely that you get a dramatic move when it goes. If we can get a week where the momentum crowd gets a hold of it in early 2014, I think we could easily see 45+.
I shorted the January 37 puts today @ .91 as a way to either collect the premium or get put the stock at a price I would be pleased with.
Approaching Christmas is rarely a bullish time for these stocks, but I think you position yourself for at least a 10% four month return by building a large position during the next 30 or so trading days. I think the market as a whole should have a selloff, but I don't think it will. However, I think you buy 1/2 of what you want in the 37-38 range, and then hope that maybe you get some kind of selloff that let's you average in cheaper. This is in preparation for the usual first quarter rally which I think we're getting well positioned for given the seasonality combined with a stock price that has gone nowhere and may be looked at as positioned to rally combined with some catalysts such as spinoff and increasing revenues from newbuilds. I think there is even a good shot at seeing a stock price of 45+ by say end of March. I'm also going to sell puts on dips to make income or get NE put to me at prices like 35 or 36 which is where I would love to average in anyway.
Hey guys, been very busy with family in town. Thanks for the well wishes and hope Thanksgiving was great for you guys. First evening where I won't be having turkey for dinner.
OK, mommy.....and thanks Bits.
I had no NE, so I bought 600 shares @ 38.08. I'll probably get to an even 1k shares if it goes lower.
I was on vacation for 16 days. I was in Prague and then Budapest. I had always wanted to see those 2 cities. I did have my laptop, but for some reason it wasn't letting me post. I had a fantastic time and some really funny experiences. Budapest has these amazing thermal water spas in really dramatic settings....I went to 2 of them....Gellert and Szechenyi and it was just SO fantastic. Travelling is cheap in both places and food is really good and pretty cheap. Anyway, thanks for your concern. I'm back but probably won't do all that much trading during Thanksgiving week. Hope all is well with you and everyone else. Hi Bits.
currently at 37.42, has support in here. I didn't have any stock so bought an opening chunk (about 1/3)....think they're just taking it down with Oil...but obviously 95 dollar oil is hardly a problem for drillers....not even close and likely to start gaining some price support pretty soon.
Hey pOnY gRRL, re: "still have a 1000 shares that may say goodbye tomorrow" hope you sold that 1k on the opening run this AM! fingers crossed that you did. ♥
I would sell at least 1/2 of my position in ESV given that we've had such a strong 3 day run....pretty good chance of a pullback after a run like that. I might even consider selling the whole thing and take a gamble that we're in a trading range where you might get a chance to buy back at say 56. I'm out of it now except for options. If it keeps on rising, oh well. I still think we get a strong up move in the first quarter of 2014, but I'm willing to bet that these stocks won't launch until sometime in January or February.
Good luck and hope all is well.