Intuitive / Analytical Practical Application

[ducati998]

CALLON PETROLEUM (NYSE:CPE) Delayed quote data

Last Trade: 15.08
Trade Time: 4:04PM ET
Change: 0.33 (2.24%)
Prev Close: 14.75
Open: 14.77
Bid: N/A
Ask: N/A
1y Target Est: 17.33

Day's Range: 14.35 - 15.11
52wk Range: 10.15 - 18.00
Volume: 135,700
Avg Vol (3m): 133,045
Market Cap: 267.23M
P/E (ttm): 12.67
EPS (ttm): 1.19
Div & Yield: N/A (N/A)


Now for something that will only show up on the "Tape" once it happens, but, if overnight, could possibly play havoc with a "Tapereaders" position.

Selling of PUT OPTIONS.
I will always sell puts, of any stock that I wish to buy.
It of course reduces my price by the premium received, and adds some immediate return to my position. Now, the Specialist, will almost certainly be aware of these positions, and will of course use them in his best interest.

Where does this leave the technical trader and the P&V trader?
If the price of the Options sold is at a "Support" level, things work out quite well.
Do I place my Strike Price at support levels........of course not.
I want a bargain, and I am a complicit ally of the Specialist in trying to run support levels on charts.

Just as a note, Turtle strategy is still long, with a stop at $13.72
Obviously, has kept me long, but, if stopped out, the loss will be much larger. Therefore on a mechanical system your backtested results must really fill you with confidence, otherwise you will be second guessing every position, and defeats the object of going mechanical in the first place.

Now, I was stopped out of position #1, and here we are back above the stoploss of $14.80.
Does that not **** you off?
It certainly used to **** me off, lost money, and lost my position.

cheers d998

 

[Tapewormtoo]

Now, I was stopped out of position #1, and here we are back above the stoploss of $14.80.
Does that not **** you off?
It certainly used to **** me off, lost money, and lost my position.

cheers d998

Yes, it can be frustrating. Most of the time though it seems when that would happen was when indicators were used for trading. Nothing wrong with using indicators but one must also "read the tape" For instance, the daily tape in CPE shows weakness but demand starting to come back in. The weekly tape shows weakness still. The monthly tape shows demand coming in. So I wouldn't hold a short position too long in this case unless things reverse. If the demand falters tomorrow then I would continue to hold. If it gets stronger I might be looking to cover. Just have to see what happens.

 

[ducati998]

Which leads directly into the topic of position size.
Now this is a really important area if you want to make money in the stock market.

So far, all my TA, puts me long.
How much money would I realistically place on a trade?
Would I place more on a different strategy?
Or, would they be pretty much the same?

The stoploss points are different for different strategies, and so far the looser stoploss has kept me in the trade, which is generally the case. The tighter your stoploss, the more frequently you will be stopped out, and so increase your losses. However, the loose stop, if activated will incur a larger $loss.

Returning to position size therefore, would the "likelihood" of being stopped out change or modify your thinking on position size?

To make money in the stock market, apart from having a winning strategy, which is kinda necessary, you must have "Capital Exposure", without which you will always just kinda break-even. That is to say your returns must be on total capital.
It is pretty pointless to have a 100% return on 10% of your capital.
This returns you 10%, whereas, a 20% return on 100% of your capital returns you 20%.

This is the theory of cut your losers, let your winners run.
Very tough to do daytrading. Obvious reasons are, how many positions can you manage at once? Lets say 4.......25% of your total bank on each trade? Or 1 position with 100% of your bank on the trade? 10 positions, with 10% of bank, watching Level2 would take on a whole new meaning.

But with the current examples, even if I re-entered the trade, I could be stopped out again.
If I was, would my discipline suffer?
Stopped out a second time, and re-enter again, .......how many times would it take before I might say, hell, forget the stop, it'll come back....................................................oh dear.

You were running a 25% position, and it just didn't come back.
The problem with TA is you really haven't got the faintest idea of what you have bought.
Therefore you must run small positions
Therefore you must run multiple positions to get capital exposure
Therefore you will in aggregate increase trading costs, stopout costs, losses, and be possibly quite frustrated.

Thoughts?
d998

 

[ducati998]

Tw2,
Do you run a trailing stop, or is your hard stop as previously detailed?
As the "Tape" only runs during the day, I presume your weekly, monthly reads are as a chart?

cheers d998

 

[Tapewormtoo]

Tw2,
Do you run a trailing stop, or is your hard stop as previously detailed?
As the "Tape" only runs during the day, I presume your weekly, monthly reads are as a chart?

cheers d998

Hard stop. I know it sounds risky but that is the way I am willing to do it. I might get hit with a loss but I also am in for a bigger move thus bigger profit when it does occur by not losing my position.

The "tape" as I see it is not just daily. It can be in any time frame. I assume you are talking about the intraday moving of prices when you say it only runs during the day. Most all my tape reading is on charts. Even the daily chart reading. I would use the intraday tape readings as a point of view on exiting my position when on an intraday basis the market is going against my position in such a way that I would consider it extremely dangerous and threatening to my position.

For instance, yesterday I said demand was coming back in but the overall view still was somewhat weak. This morning it opened gap up and traded up to 15.57. Now, I could still cover at a profit and would do so if I made no comparison of the intraday data with the daily "tape" and the weekly tape and the monthly tape. However, my opinion based on the best I can interpret the tape is that this gap up is weak and I would expect the gap to be filled if not by the end of the day probally within the next couple of days. So, I will take the chance on holding my position. If, on the other hand, demand for one reason or the other, increased explosively, then I should be able to cover with at least a breakeven. If the demand increased so much that it traded up this way quickly then I would forget my hard stop and take anything I could get. Basically, my stop loss is to protect me if I am wrong in the start of a move. If I read the tape correctly and right away I get a profit then my hard stop takes on less and less significance for me as I can usually get at out at some sort of profit or breakeven.

To sum up: I see this gap up as weak (at this time today) and this is confirmed by the intra-day tape and the daily tape (up to now). General direction as expressed by the weekly and monthly tape readings are still somewhat weak. So, even though demand began creeping in yesterday and obviousley today I don't think the demand has proved to be strong enough (as of yet) to overcome the overall weakness that I still see expressed in the tape readings thru different time periods. So, I continue to hold my short position. 1:19 Eastern time

 

[ducati998]

Tw2,
Here is just a brief snapshot.
Now, the volume, unless you are going to watch P&S, which will still not reveal the intent, as it may be a short covering, or a legitimate long being initiated, what information does it impart?

To my mind, volume analysed in the context of longer term holdings has validity, but is not a quick decision method. Useless for daytrading, and dependant on timeframe a bit of information overload for the swing-trader.

You have maintained consistently that the "Tape" has been weak for buying over the last week or so, and that this indicates the probabilities lie with a short position.
Can you expand on what leads you to your conclusion. ( P&V analysis )
If its just a "gut" feeling thats fine, can you expand a little on how you trade your gut?


CALLON PETROLEUM (NYSE:CPE) Delayed quote data

Last Trade: 15.58
Trade Time: 2:46PM ET
Change: 0.50 (3.32%)
Prev Close: 15.08
Open: 15.35
Bid: N/A
Ask: N/A
1y Target Est: 17.33

Day's Range: 15.32 - 15.59
52wk Range: 10.15 - 18.00
Volume: 54,300
Avg Vol (3m): 133,045
Market Cap: 276.09M
P/E (ttm): 13.09
EPS (ttm): 1.19
Div & Yield: N/A (N/A)


cheers d998

 

[ducati998]

And, a little later.


CALLON PETROLEUM (NYSE:CPE) Delayed quote data

Last Trade: 15.64
Trade Time: 3:04PM ET
Change: 0.56 (3.71%)
Prev Close: 15.08
Open: 15.35
Bid: N/A
Ask: N/A
1y Target Est: 17.33

Day's Range: 15.32 - 15.64
52wk Range: 10.15 - 18.00
Volume: 55,900
Avg Vol (3m): 133,045
Market Cap: 277.16M
P/E (ttm): 13.14
EPS (ttm): 1.19
Div & Yield: N/A (N/A)


d998

 

[ducati998]

Sentiment..................changes again

Specter of $105 oil spooks stocks
Goldman Sachs says oil is in the early stages of a 'super spike' period. Chicago PMI rises sharply in February. Elan plunges on Tysabri death. S&P cuts AIG's credit rating.


A brokerage call indicating oil prices could climb above $100 pushed oil prices sharply higher and kept stocks pinned down this afternoon.

The Dow sank 0.37%, the Nasdaq composite lost 0.49%, and the S&P 500 index edged down a point.Banks and insurers
check your credit.
So should you.



New York light crude futures rose $1.61 to $55.60 in midday trading, in part because of a Goldman Sachs research note that said the market is in the early stages of a "super spike" period. Goldman revised its "super spike" range to $50 to $105 per barrel from $50 to $80 per barrel, Briefing.com reported.

The brokerage said oil prices will have to rise high enough to actually curb demand and reduce consumption before prices sink again.

The "new range is now driven slightly more by the oil price we think is needed to cause a multi-year reduction in energy consumption and slightly less so by the potential for political disruption in a major oil exporting country," Goldman said.

Hedge-fund trading and other speculative activity may contribute to day-to-day volatility, but it's unlikely to contribute to the sustained rise in oil prices seen recently, the brokerage said.

And while the United States seems to be absorbing higher energy costs, high oil prices raise the possibility of "a sharp slowdown" in China, Goldman said.


Read more on Goldman's oil call.

Naturally, record crude prices have been a boon for energy companies. The Amex Oil index rose 16.51% in the first quarter. The Amex Natural Gas index gained 9.81% and the Philadelphia oil services index jumped 9.01%. Refiner Valero Energy (VLO, news, msgs) was the top performer in the S&P 500, soaring more than 50%.

Those industries dependant on oil, like airlines, are hurting. The Amex Airline index fell 17.14% in the first three months of 2005. Delta Airlines (DAL, news, msgs) was one of the S&P 500 stocks, dropping more than 45%.


See a screen of how major oil companies have done in the last quarter.


Check out the quarterly stock performance of major refiners

PMI jumps; spending strong
The Chicago Purchasing Manager's index rose to 69.2 in March from 62.7 in February. Economists expected the measure of manufacturing activity to dip to 60.5.

"Evidently capital spending is coming back much stronger than many people realized and that is probably what is behind that strong reading," Mark Vitner, senior economist at Wachovia Securities, told Reuters.

Consumer spending rose 0.5% in February, compared to a revised 0.1% increase the month before, the Commerce Department reported before the bell. The increase was in line with economists' expectations. Personal income rose 0.3% last month, compared to a 0.2% increase in January. Economists were looking for a slightly higher increase of 0.4%.

There was one note of caution. The core PCE price index, which measures consumer expenditures minus food and energy and is a favorite inflation gauge of Federal Reserve Chairman Alan Greenspan, rose 0.2% in February and is 1.6% higher than the same time last year.

There is little room for that index to rise more before the Fed takes more aggressive action to curb inflation, Stuart Hoffman, chief economist at PNC Financial Services Group, told CNBC's "Squawk Box."

Also this morning, claims for first-time unemployment benefits jumped by 20,000 to 350,000 last week, the Labor Department said. Economists were predicting jobless claims would drop slightly.

The end of MS drug Tysabri?
Shares of pharmaceutical company Elan (ELN, news, msgs) lost more than half their value after the company said its multiple sclerosis drug Tysabri was linked to another death in a patient. Biogen Idec (BIIB, news, msgs), Elan's partner in the drug, sank more than 10.7%.

The companies suspended marketing of the drug in February after it was linked to a fatal illness.

"This may actually be the death knell for the drug," Brett Holly, biotech analyst at CIBC World Markets, told "Squawk Box."

Meanwhile, Calyon Financial upgraded Time Warner (TWX, news, msgs) to "buy" from "add." It said they believe the company's joint bid with Comcast (CMCSA, news, msgs) for Adelphia Communications will be a major catalyst, Briefing.com reported.

And Freddie Mac (FRE, news, msgs) said its 2004 profit fell to $3.78 per share from $6.68 per share the year before, due to a change in accounting for derivates.

AIG credit rating cut
American International Group's (AIG, news, msgs) accounting trouble is hitting its borrowing power now. Standard & Poor's cut its senior debt credit rating on the company to AA from the top rating of AAA. AIG had kept an AAA rating since 1983, Briefing.com reported.

And the company's improper transactions could cut its net worth by $1.77 billion, The Wall Street Journal reported. The company's statement yesterday, which listed eight areas where accounting problems exist, does not cover the full extent of the company's problems, the Journal said, citing people familiar with the matter.

One source told the Journal that authorities are looking into a pattern of "serious hoodwinking" and said criminal charges against those responsible are possible.

-- Kim Khan

 

[Tapewormtoo]

I am still holding my short position at the market close. I am really busy the rest of the day but maybe tonight I can give a little more explanation.

tw2

 

[ducati998]

CALLON PETROLEUM (NYSE:CPE) Delayed quote data

Last Trade: 15.54
Trade Time: 4:05PM ET
Change: 0.46 (3.05%)
Prev Close: 15.08
Open: 15.35
Bid: N/A
Ask: N/A
1y Target Est: 17.33

Day's Range: 15.32 - 15.70
52wk Range: 10.15 - 18.00
Volume: 92,800
Avg Vol (3m): 133,045
Market Cap: 275.38M
P/E (ttm): 13.06
EPS (ttm): 1.19
Div & Yield: N/A (N/A)

Tw2,

am still holding my short position at the market close. I am really busy the rest of the day but maybe tonight I can give a little more explanation.

Sure, no problem, look forward to it.


Just really as a summary so far.
The general idea was to give a contrasting view of different trading strategies and investing strategies, on one consistent example, CPE.

What I wanted to highlight was the analysis of each particular strategy in relation to market sentiment................what appears on the chart each market session.
How effective was each strategy at getting and keeping you a profit on this trade(s). That is at the end of the trade(s) are you in net profit.

So far, Strategy #1........stopped out. No re-entry $630 loss on 1000 share position
............Strategy #2.........stopped out no re-entry $630 loss on 1000 share position
.............Strategy#3........Showing small paper profit of $0.29 on 1000 share position
...........Strategy #4.........stopped out @ $14.80 ......$630 loss on 1000 share position
............Strategy #5........no entry taken
............Strategy #6.......Still open, showing paper profit of $0.29 on 1000 share position
............Investment........No position opened, but PUTS sold for Strike @ $11.50 Realised profit.
**Note.....CPE does not actually have OPTIONS listed, thus purely theoretical strategy for CPE

And TAPEWORMTOO,
...........Strategy P&V........Trade Open

Is anyone interested in providing an analysis of the VOLUME?
Tw2, will I think give his ideas, and I shall provide my own, any takers......even complete novices? This is one way to learn, put up your thinking in public, adds a little reality to the experience............and hell, none of the experts have offered anything so what you got to lose?

cheers d998

 

[ducati998]

Here is a list of "VOLUME" outside of the noise factor.
Now this volume is important, as it will effect real changes on supply and demand of the "shares"

The intra-day volume, basically is just noise. It will or may provide you better or worse entry points into your position, but apart from that, lends very little to an analysis of volume in the context of supply and demand.

The noise, and those that trade it requires at least direct access, very cheap brokerage, volatility, and a sound system of scalping a profit.

Volume in a longer term context is valid, but will always be a bit of a slow data point to base the opening or closing of a position on. It may however be confirmatory to other analysis.

NET SHARE PURCHASE ACTIVITY
Net Institutional Purchases - Prior Qtr to Latest Qtr
Net Shares Purchased (Sold) 584,000
% Change in Institutional Shares Held 4.8%

So, over the last Q1 the float has been reduced by 4.8%
And all the noise, is contradictory to that simple fact.

Where does this leave the "technical trader"?
Is chart analysis of "volume" anywhere near the depth required to base a conclusion on?
Particularly, if you are going to place $$ on it.

cheers d998

 

[ducati998]

Just found these that had been previously posted by "THE BRAMBLE"

Originally Posted by TheBramble
There are six kinds of volume:~
Causative.
Consequential.
Inadvertent.
Mixing.
Delayed
and Rogue.

Although these types of volume were never expanded upon, I wonder if any would care to hazard some guesses?

I'll take a shot at those of which I think I can make a half-sensible interpretation.

Causative - The volume causes the price to move.
Consequential - The volume is as a consequence of the price action.
Inadvertent - no idea.
Mixing - no idea.
Delayed - The volume reported is delayed either accidentally or deliberately.
Rogue - A spike or feed error in volume data.

and,

When the MMs get to the point where they want to unload (distribution) they artificially mark-up the price to attract buyers (generally on low volume so there is no causation in effect) and as a result mug-punters pile in with as a CONSEQUENCE of the price and create volume. CONSEQUENTIAL volume. CONSEQUENTIAL volume i.e. volume that is as a consequence of price action (not volume action)

The discussion then sort of died out.
They were however very good questions and observations, curious why none of the P&V experts never really came back to him on these factors.

To my mind, you have to seperate for want of a better term Investor Volume, that has been taken out of circulation for an indeterminate period, and Speculator Volume which will one presumes have a recyclebility that can be manipulated by the MM.

Now of course one of the points being made, and I concur, is that PRICE will cause or create volume. Can the same statement be made in regard to volume?

d998

 

[ducati998]

Just the latest bit of news regarding the price of oil and where it might go.
Now for CPE, and any Oil Producer, the price received for the barrels produced will always be a determinant in their earnings.

More so if they are a high cost producer, which we know that CPE isn't particularly.
Most producers will trade in the futures market trying to hedge their final selling price. CPE certainly does this, and will thus take losses on contracts at times.

Notice that the "average" price received has been $50 / barrel.
This is about $25 / barrel higher than they had previously hedged their production at, so earnings, you would expect to rise.

Extra
Oil prices surge after $105-a-barrel forecast

Research report forecasts dramatically costlier crude and suggests a 'super spike' -- fueled by 1970s-style inflation -- could send prices well into triple digits.

By Reuters

Oil markets have entered a "super-spike'' period that could see 1970s-style price surges as high as $105 a barrel, investment bank Goldman Sachs said in a research report Thursday that sent oil futures spinning.

U.S. light crude settled up $1.41 to $55.40 a barrel after peaking at $56.10, within $1.50 of the $57.60 record high struck on March 17. Benchmark Brent futures jumped $2.20 to $54.29 a barrel.

Oil prices have climbed around 25% this year as signals that rapid demand growth in emerging economies China and India will strain world supply ignited heavy buying from big-money funds.

Goldman's Global Investment Research note raised the bank's 2005 and 2006 New York Mercantile Exchange crude price forecasts to $50 and $55 respectively, from $41 and $40.

These forecasts sit at the top of a table of predictions from 25 analysts, consultants and government bodies surveyed by Reuters.

"We believe oil markets may have entered the early stages of what we have referred to as a "super spike'' period -- a multi-year trading band of oil prices high enough to meaningfully reduce energy consumption and recreate a spare capacity cushion only after which will lower energy prices return,'' Goldman's analysts wrote. Banks and insurers
check your credit.
So should you.



The analysts said resilient demand had led them to revise their super-spike range to $50-$105 per barrel from $50-$80 previously, noting strength in oil demand and economic growth in the United States and China especially.

U.S. oil futures on the New York Mercantile Exchange have averaged $50.03 per barrel so far in 2005.

Goldman Sachs is the biggest trader of energy derivatives, and its Goldman Sachs Commodities Index is a widely-watched barometer of energy and commodities prices.

Goldman pointed out thin spare capacity in the energy supply chain, and long response times for bringing on supply additions, as well as robust demand in the United States and in developing heavyweights China and India, despite the recent rapid increase in energy costs.

Shades of the 1970s
Goldman said the current oil market environment looked more like that seen in the 1970s -- when oil prices spiked dramatically following the Arab oil embargoes on supply to the West and Iran's revolution.

High energy prices threw the world into recession, and triggered several years of declining oil demand.

Supply growth continued unabated and bolstered spare capacity, which in turn stabilized oil markets at lower prices -- a phase of the market cycle that Goldman's researchers said had only just ended


The bank also said its super-spike forecast range was conservative, noting declining U.S. gasoline spending as a proportion of GDP and consumer spending.

During 1980-1981, gasoline spending in the United States corresponded to an average 4.5% of GDP, 7.2% of consumer expenditures, and 6.2% of personal disposable income, Goldman said.

"Our new $50-$105 per bbl super spike range perhaps conservatively corresponds to gasoline spending in the United States that reaches 3.6% of forecasted GDP, 5.3% of consumer expenditures, and 5.0% of personal disposable income.

Goldman said that were it to assume gasoline spending needed to reach 1970s levels to destroy demand, its upside super-spike estimate would be $135 per barrel for New York crude.

"Perhaps the ultimate answer to high how oil prices need to go before demand destruction occurs is derived from knowing when American consumers will stop buying gas guzzling sport utility vehicles and instead seek fuel efficient alternatives.

"Based on our analysis of gasoline spending and the economy noted above, we estimate that U.S. gasoline prices may need to exceed $4 per gallon."

 

[ducati998]

CALLON PETROLEUM (NYSE:CPE) Delayed quote data

Last Trade: 15.40
Trade Time: 3:59PM ET
Change: 0.14 (0.90%)
Prev Close: 15.54
Open: 15.70
Bid: N/A
Ask: N/A
1y Target Est: 17.33

Day's Range: 15.22 - 15.74
52wk Range: 10.15 - 18.00
Volume: 94,400
Avg Vol (3m): 135,818
Market Cap: 272.90M
P/E (ttm): 12.94
EPS (ttm): 1.19
Div & Yield: N/A (N/A)

 

[ducati998]

In regards to VOLUME.

To really understand the place volume plays in an analysis it would to my mind at least to yourself, define or determine what you believe ultimately creates market prices.

As far as I am concerned the final arbiter of market price is the earning power of the business that the shares represent a proportion of.
If the business is consistently successful in creating wealth, then the market price will at some point represent that value.

At other times it will be over or under-valued dependant upon market sentiment.
As regards volume, logically you would expect demand, and therefore volume to be higher at a lower price, as the lower price represents better value. This is not consistently found however, usually ample supply is available at the lower price, thus facilitating easy entries, at higher prices, still not what you would expect, higher price, higher demand, lower supply, until...............some big holder dumps........then watch out, as sometimes a rush for the door ensues, leaving late comers taking a loss, very often this is the trend reversal. The key is who supplied the volume. It will never be daytrader or short-term volume that does this, it will always be institutional volume.

Most institutional buyers will practice "diversification".
Assuming you accept this, then lets say an institution has $100M under management, and they will deploy no more than 5% of their funds into a stock......or $5M

A $5M position in CSCO, may not put much of a dent in the total float.
A $5M position in CPE, that has only 17M total shares starts to reduce supply quite quickly. Therefore it must be the aggregate of institutional volume that you must assess. While you will always see "what is"...............the information that you need is not just how much they hold, but under what conditions or scenario, or price will they become sellers.
This will always be guesswork, therefore, volume as an analytical tool will always be a lagging tool, not as P&V practitioners would have you believe a "leading"indicator.

Currently we know that 70% of the available float is accounted for by the institutions.This leaves approximately 5M shares available. The Specialist will require inventory to make the market, and provide shares for any bigger buyers. Should this demand exceed his ability to provide, then share-splits can be an answer, or he just has to move price around to shake out short-term traders, if there is enough volume being held, and the Specialist will have a very accurate idea as to what is held by the weak holders

This really looks at volume from an investment point of view.
What about the daytrader, swing trader, what does this reduced volume mean to him?
Generally it means greater volatility, and greater % range in price.
This stock just of late has been fluctuating at about 5% a day, which for a sleepy little stock is quite a lot.

With so much of the float in institutional hands at the moment, very bullish noise as for the price of oil, I would contend that intra-day volume means absolutely nothing currently. It is noise, price will jump all over,..again irrelevant, just inventory adjustment.
If intra-day volume was significant to analysis at this point, you would be looking at some follow through........there is none.

This stock, over the next 6mths will hit $22+
Dependant on what oil is doing at that point, and how the Company has set up the hedging contracts for their production, then the fundamentals may well be changing, and you may well see some real "supply" come into the market, until then just noise.

cheers d998

 

[ducati998]

Associated Press
Crude Futures Near Record-High Levels
Monday April 4, 12:09 am ET
By Wee Sui Lee, Associated Press Writer
Crude Futures Near Record-High Levels Despite OPEC Saying Would Initiate Second Output Rise


SINGAPORE (AP) -- Crude prices pushed near record-high levels on Monday even though the president of the Organization of Petroleum Exporting Countries said the group would initiate a second output rise to calm an overheated crude market.



Light, sweet crude for the May contract had risen 29 cents to US$57.56 a barrel on the New York Mercantile Exchange as of midday in Asia. The benchmark commodity reached a record high of US$57.70 a barrel on Friday.

Heating oil prices rose marginally to US$1.6695 a gallon (3.8 liters).

The president of OPEC said Saturday the group will increase its overall production ceiling by 500,000 barrels a day starting in May to meet expected world demand.

"For sure, there will be an increase in the third quarter and fourth quarter, and the increase will start from May," Sheikh Ahmad Fahad al-Ahmad Al-Sabah said.

Al-Sabah was referring to an increase previously authorized by OPEC during its meeting in Isfahan, Iran, last month. At that time, OPEC increased its production ceiling by 500,000 barrels to 27.5 million barrels a day, and said it might provide for another 500,000 barrels a day if crude prices did not stabilize.

Al-Sabah attributed the recent change in prices to psychological fears of supply shortages and added that OPEC should reassure the market in order to cap the price surge.

OPEC already is exceeding the production ceiling, at around 28 million barrels a day, according to Al-Sabah.

Lorraine Tan, director of research at Standard & Poor's investment services in Singapore, said the timing of OPEC's actions is crucial in affecting crude prices.

"If OPEC acts quicker, prices would come off," she said.

Prices rose Friday after a power failure at Venezuela's giant Amuay oil refinery forced the plant to shut down its processing units on Thursday.

Petroleos de Venezuela S.A., or PDVSA, said the refinery would be running at full capacity within a week. The Paraguana refining complex, which includes the Amuay and Cardon refineries, normally produces around 700,000 barrels per day.

Venezuela is the world's fifth largest oil exporter and a major fuel supplier to the United States.

Prices have gained more than US$3 since Thursday, when Goldman Sachs, a major trader in the energy markets, released a report saying oil markets might have entered a "super-spike" period which could eventually push prices toward US$105.


Interesting to see what happens today with CPE and Oil prices, contrasted with the index.
cheers d998

 

[ducati998]

Well, if you were trading sentiment today, you would have needed to be long, as the price rose. Was it due to the price of oil?
Was it due to the index?
Was it due to the value within the business?

If you are a technical trader, you may very well have no views on the above at all.
You may quite legitimately say "I trade price, or volume, or XYZ" but, volume, in many cases, particularly small caps will have absolutely no impact, if you are watching daily volume.

Volume will only work for you if you watch real supply of volume, and this is so lagging that for a daytrader it is worse than useless.
In a large cap, say a CSCO, then volume may be of use in tracking daily momentum.

PRICE.
Of what use to a daytrader is price?
What does price mean to a daytrader?
I have seen, numerous references from P&V exponents, that they do not even use volume, price contains all. I have never seen a definition from them on price that makes even remote sense in how they are attempting to use it.

Summary of todays "PRICE ACTION"


CALLON PETROLEUM (NYSE:CPE) Delayed quote data

Last Trade: 15.91
Trade Time: 3:47PM ET
Change: 0.51 (3.31%)
Prev Close: 15.40
Open: 15.50
Bid: N/A
Ask: N/A
1y Target Est: 17.33

Day's Range: 15.50 - 15.95
52wk Range: 10.15 - 18.00
Volume: 126,400
Avg Vol (3m): 137,181
Market Cap: 281.94M
P/E (ttm): 13.37
EPS (ttm): 1.19
Div & Yield: N/A (N/A)


And almost the close

CALLON PETROLEUM (NYSE:CPE) Delayed quote data

Last Trade: 15.76
Trade Time: 4:02PM ET
Change: 0.36 (2.34%)
Prev Close: 15.40
Open: 15.50
Bid: N/A
Ask: N/A
1y Target Est: 17.33

Day's Range: 15.50 - 15.95
52wk Range: 10.15 - 18.00
Volume: 135,900
Avg Vol (3m): 137,181
Market Cap: 279.28M
P/E (ttm): 13.24
EPS (ttm): 1.19
Div & Yield: N/A (N/A)


cheers d998

 

[ducati998]

Although nothing to directly do with CPE, currently, in case you had missed it Wall St. is in M&A mode again.

A small cap stock like CPE can very often become a takeover target.
Now, if you had bought undervalued shares, and suddenly you are the target of a takeover, you get your cake very early.

Of course, "workouts" can be a very lucrative pastime in their own right.


Associated Press
ChevronTexaco to Buy Unocal in $16.4B Deal
Monday April 4, 2:15 pm ET
By Michael Liedtke, AP Business Writer
ChevronTexaco Is Buying Rival Unocal for About $16.4 Billion in Cash and Stock


SAN RAMON, Calif. (AP) -- ChevronTexaco Corp., the nation's second largest oil company, is buying smaller rival Unocal Corp. for about $16.4 billion, hoping to further elevate its already surging profits by boosting its oil and natural gas supplies in Asia.



The deal announced Monday proposes to unite San Ramon-based ChevronTexaco, which trails only to Exxon Mobil Corp. in the U.S. oil business, with El Segundo-based Unocal, the nation's ninth biggest oil and gas production company.

ChevronTexaco initially valued its acquisition price, consisting of stock and cash, at $62 per share, nearly 4 percent below Unocal's closing price last week.

The offer disappointed investors, who had driven up Unocal's market value by 20 percent since the media reported ChevronTexaco's was discussing a possible takeover a month ago. Unocal's shares slipped $4.74, or 7.4 percent, to $59.61 during Monday afternoon trading on the New York Stock Exchange, while ChevronTexaco's shares fell $2.16, or 3.6 percent, to $57.15.

As part of the deal, ChevronTexaco will assume $1.6 billion of Unocal's debt and sell about $2 billion in assets.

ChevronTexaco Chairman David O'Reilly told reporters Monday that he expects the proposed takeover to receive the required regulatory approvals so it can be completed before year's end.

Based on the two companies' most recent results, ChevronTexaco would have annual sales of about $163 billion after the acquisition is completed. That means the combined company still would be far smaller than Irving, Texas-based Exxon Mobil, which rang up nearly $300 billion in revenue last year.

Unocal has been considered an attractive takeover target for years, largely because of its valuable cache of natural gas in Asia and oil in the Gulf of Mexico. The company reportedly drew interest from the China National Offshore Oil Corp., a large state-owned company, and Italian oil company Eni SpA before settling on a sale to ChevronTexaco.

ChevronTexaco prizes Unocal for its natural gas supplies in Asia, O'Reilly said. That rapidly growing part of the world could shape up as a potential gold mine for ChevronTexaco because China and India are consuming more energy to fuel their bustling economies, a phenomenon likely to drive up prices for years to come.

Unocal's oil supplies in the Gulf of Mexico also figure to give ChevronTexaco even more clout in the North American oil and gasoline markets.

O'Reilly predicted Unocal would "fit like a glove" with ChevronTexaco. "This squarely fits with our key objectives," O'Reilly told reporters in a Monday conference call.

Like other major oil companies, ChevronTexaco already has been flourishing, thanks largely to a rapid run-up in oil prices that has pushed U.S. gasoline prices well over $2 per gallon, squeezing consumers and businesses alike.

ChevronTexaco earned $13.3 billion last year, the most profitable year since its inception in 1879. Unocal earned $1.21 billion last year, nearly doubling its profit from the previous year.

O'Reilly is betting ChevronTexaco can make even more money by drawing on Unocal's energy supplies and cutting costs from the overlapping operations of the two companies.

ChevronTexaco expects the deal to boost profits by at least $325 million annually, with about two-thirds of that targeted amount, or roughly $215 million, coming from lower expenses.

O'Reilly said the cost-cutting efforts will include layoffs, but declined to project how many people will lose their jobs. He indicated the layoffs will be concentrated in the U.S.

ChevronTexaco employs 47,000 workers while Unocal has about 6,000 employees.

The bid to buy Unocal marks the second major acquisition negotiated by O'Reilly since he became ChevronTexaco's CEO in 2000. The company bought Texaco Inc. for $39 billion 3 1/2 years ago, a deal that resulted in thousands of layoffs.

 

[ducati998]

Just to keep a check on that VOLUME parametre, follow what the insiders are up to.
Won't help you daytrading, but might help a longer term system.



View a Quick Analysis of these stocks

The rise in energy prices has propelled shares in oil and gas companies to all-time highs, prompting some insiders to lock in gains by selling company stock, said Mark LoPresti, senior quantitative analyst at Thomson Financial.

"We've seen increased selling in the oil and gas industry as a whole," LoPresti said Monday on CNBC's "Power Lunch." "Last month, oil and gas drillers were the top sellers, by market value. They were the second-top sellers by net shares sold, and, by head count, there were five sellers for every one acquirer."

Among the sellers were insiders at Barbados-based oil and gas contract driller Nabors Industries (NBR, news, msgs), LoPresti said. Insiders also sold at Texas-based exploration and production company Pioneer Natural Resources (PXD, news, msgs)



Insider selling is no surprise, given the outsized gains in oil and gas shares, LoPresti said. "But this is a signaling event, where insiders are telling you that they feel this is fairly valued and they're taking shares off the table."

LoPresti analyzes legal insider trading documents filed with the Securities and Exchange Commission. Directors and some corporate executives who buy or sell shares in their companies are required to report the transactions to the government.


Nabors Industries Ltd.

• Six insiders sold 6,932,929 shares for between $51.41 and $59.98 each, LoPresti said.
• It's the largest number of shares sold by insiders at the contract oil and gas driller in a 90-day period. The sales generated almost $400 million, LoPresti said.
• "One of the future risks for drillers is that liquefied natural gas has been expected to play a growing role in satisfying North American demand," LoPresti said. "Domestic gas drillers may be hurt by that."




Pioneer Natural Resources

• Eighteen insiders sold 960,446 shares for between $34.70 and $44.65 each, LoPresti said. It's the largest consensus selling yet at the oil and gas company.
• It's the second-largest number of shares sold in a 90-day period, LoPresti said.
• "One of the insiders here is a top holder of stock. He makes one of the largest sales at the company in over five years," LoPresti said.

cheers d998

 

[ducati998]

Price.
What is it?
To myself, price represents the $value that you pay for the business.
If my business earns $1 after all expenses, how much would you pay me for it?

Would you pay me $1000? No. Why not? (If yes, phone me )
Would you pay me $100?

The point obviously, although not this simplistic, is a business has an acceptable value, from which you will earn a return. The business may improve, or regress, and the price you have paid becomes of great import.

Price, for technical P&V, actually could be replaced by "X" and "Z".
It has no meaning.
Simply, you try to guess, from a pattern of previous X's and Z's whether it will continue up or down, or change. Thats it. If wrong, your stop takes you out of the trade.

Pattern recognition rules. If you are no good at pattern recognition, you better hope you have the mental discipline to remove yourself from further potential damage.

One method relies on hunting out bargains, or in terms of a workout, Corporate actions in contradistinction to market appraisal.

The other, trying to figure out what the crowd will do, and joining them before they move too far, and change their minds again.

One is very easy in theory, but very difficult in practice.
The other is difficult in theory, but easy in practice.

cheers d998