October crude oil posted an upside reversal on Tuesday ending a two day decline. The high range close sets the stage for a steady to higher opening when Wednesday's night session begins. Stochastics and the RSI are bearish hinting that a short term top might be in or is near. Closes below the 20 day moving average crossing at 106.34 are needed to confirm that a short term top has been posted. If October renews this summer's rally, weekly resistance crossing at 114.83 is the next upside target. First resistance is last Wednesday's high crossing at 112.24. Second resistance is weekly resistance crossing at 114.83. First support is the 20 day moving average crossing at 106.34. Second support is the reaction low crossing at 103.50.
If you attend one webinar this summer make it..."How to Beat the Market Makers" with John Carter. Click here to Sign up NOW!
October Henry natural gas closed higher on Tuesday and tested the 38% retracement level of the May-August decline crossing at 3.680. The high range close sets the stage for a steady to higher opening on Wednesday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near term. If October extends this month's rally, the 50% retracement level of the May-August decline crossing at 3.842 is the next upside target. Closes below the 20 day moving average crossing at 3.457 would confirm that a short term top has been posted. First resistance is the 38% retracement level of the May-August decline crossing at 3.680. Second resistance is the 50% retracement level of the May-August decline crossing at 3.842. First support is the 20 day moving average crossing at 3.457. Second support is August's low crossing at 3.154.
Ready to start trading crude oil? Start right here....Advanced Crude Oil Study – 15 Minute Range
The September S&P 500 closed higher on Tuesday as it consolidates above the 50% retracement level of the June-August rally crossing at 1629.45. The low range close sets the stage for a steady to lower opening when Wednesday's night session begins trading. Stochastics and the RSI are diverging but remain neutral to bearish signaling that sideways to lower prices are possible near term. If September extends the decline off August's high, the 62% retracement level of the June-August rally crossing at 1611.47 is the next downside target. Closes above the 20 day moving average crossing at 1659.67 would confirm that a short term low has been posted. First resistance is today's high crossing at 1649.80. Second resistance is the 20 day moving average crossing at 1659.67. First support is last Wednesday's low crossing at 1625.00. Second support is the 62% retracement level of the June-August rally crossing at 1611.47.
Day Trading History of 16 Major Candlestick Patterns
October gold closed higher on Tuesday and the high range close sets the stage for a steady to higher opening when Wednesday's night session begins trading. Stochastics and the RSI are overbought but are turning bearish hinting that a short term top might be in or is near. Closes below the 20 day moving average crossing at 1361.90 would confirm that a short term top has been posted. If October renews the rally off June's low, May's high crossing at 1489.00 is the next upside target. First resistance is last Wednesday's high crossing at 1432.90. Second resistance is May's high crossing at 1489.00. First support is the 10 day moving average crossing at 1396.10. Second resistance is the 20 day moving average crossing at 1361.90.
Michelle "Mish" Schnieders new free eBook. Download now, and get "Mish's Daily" insight to the next moves!
Tuesday, September 3, 2013
Monday, September 2, 2013
"Beating the Market Makers" John Carter's Webinar Replay
Over 10,000 traders watched the live webinar on Tuesday and John does limit seating so sign up right away before traders fill all of the slots.
Just Click here to Register Now
Here's what he'll be covering...
- How to be on the same side as the Market Maker
- How to protect yourself in a trade
- How to pick the right stock at the right time
- What Wall Street doesn't want you to know about weekly options
- The one simple trick to put the odds in your favor
And much more......
This timely webinar replay will take place this Wednesday, August 22nd at 8:00 PM Eastern Time.
Click here to register
After you register you will receive reminder emails automatically so you don't miss the webinar. I don't know if they'll be recording this, or if he'll ever share this information again, so don't miss out.
We'll see you in this free training class, then we'll see you in the markets. Will you be trading with us....or against us?
Ray @ The Crude Oil Trader
Market Makers.....Can you be on the same side of the trade?
Sunday, September 1, 2013
Is 1,600 the Next SP500 Support Level?
Since the current Syrian situation arose, we have seen some strong volatility return to U.S. financial markets. The observed volatility has included both realized volatility and implied volatility in many of the various option chains. There are pundits who will surmise a variety of outcomes, but frankly no one knows for sure. Will oil prices spike if military action occurs in Syria? Will oil prices fall on a military action(s)? What will happen to gold? What will happen to risk assets? Will they find Jimmy Hoffa?
We have recently received several emails asking these questions. We have answered them all in the same manner. We have no idea what is going to happen in financial markets for sure. Anyone who says they do does not respect the randomness of markets. We can look at option based probabilities for some clues, but there is no definitive answer.
Instead we want to look at a very powerful tool that is available on most trading software platforms. Volume by price is a powerful tool to determine where key levels are in an index or price chart.
Our complete chart work and set ups for the S&P 500 Index are shown here.
Trade Stock and ETF's Options Like a Pro - Join Now!
Friday, August 30, 2013
The Energy Report: Micro-Cap Oil Stocks that Hit the Jackpot
The Energy Report: With oil prices firming
up over the past couple of months and the spread between West Texas
Intermediate (WTI) and Brent Crude narrowing, what are your price
expectations for the remainder of 2013 and into next year?
Phil Juskowicz: While I don't spend a lot of time predicting commodity prices, I personally see relatively stable short-term oil prices. Intermediate or long-term prices may weaken, assuming no supply disruptions arise from political upheavals, while gas prices may strengthen based on supply/demand fundamentals. We've seen continued oil supply growth and the short term market seems to be pretty range bound, having developed a good base around the $100 per barrel ($100/bbl) level.
TER: Where do you see some of the best investment opportunities in the oil and gas business?
PJ: Micro-cap exploration and production (EP) stocks have severely underperformed the SP Small Cap EP Index since the second half of 2011 (H2/11). However, the definition of "small cap" depends on who you're talking to. The Small Cap EP Index consists of companies around the billion-dollar range like Approach Resources Inc. (AREX:NASDAQ) and Northern Oil Gas Inc. (NOG:NYSE). Casimir has a micro-cap EP index, which is comprised of companies with market caps up to $500 million ($500M) with some names under $100M. That index level started to diverge in H2/11. Both of these groups consist of relatively equal gas/oil weightings, so the performance should not, in our opinion, be attributed to the relative strength of oil prices over gas that commenced around that time. As a result, we believe that there are attractive investment opportunities in the micro-cap EP universe.
Casimir Micro-Cap EP Index (White) vs. SP Small-Cap EP Index (Yellow)
Casimir Micro-Cap EP Index composed of: AMZG, ANFC, CAK, CPE, CXPO, EGY, EEG, ENRJ, ENSV, FEEC, FXEN, GMET, GNE, HDY, HNR, IFNY, IVAN, LEI, MCEP, MILL, MPET, MPO, OEDV, PHX, PNRG, PSTR, RDMP, SARA, SSN, STTX, TAT, TENG, TGC, TPLM, USEG, WRES, ZAZA
Source: Bloomberg; Casimir Capital
TER: How do you choose the companies in your coverage list?
PJ: We look for small companies that have largely flown "under the radar screen" and are underfollowed. The companies we cover have strong management teams and operate in premier areas with good assets that have substantial cash flow potential.
TER: Do you cover any service companies?
PJ: Enservco Corp. (OTCBB:ENSV) is on our "watch list". The company is the only nationwide provider of hot oiling, well acidizing and frack heating services generally used to coax oil out of the ground, for example to counter paraffin buildups. Enservco experienced healthy margins in Q2/13 despite it typically being a seasonally weak time for heating services. The company continues having to turn customers away in some areas while it builds out its fleet. Management, in our opinion, has a track record of building successful companies and its regional staff has strong relationships with EPs. The company is also expanding into other basins and successfully tapping into new revenue sources.
TER: Why aren't competitors seeing the opportunity here and moving in to get a piece of the action?
PJ: There are regional pockets of mom and pop shops that will do some of these services, but, a nationwide company like a Noble Energy Inc. (NBL:NYSE) might turn to Enservco because it already has a reliable relationship with Enservco's staff in different areas. Enservco's services account for a very low percentage of total well drilling and completion costs (it might cost around $100,000 to service a $7M well) so customers are not as likely to conduct competitive bidding processes. Instead, they choose to use a company with which the frontline managers already have existing relationships.
TER: So it has developed a national reputation, which is its competitive strength.
PJ: And it's building out the capacity as we speak. Enservco is expanding its already large presence in the Marcellus Formation. In its Q2/13 conference call, management said they were starting to see the Utica play out a little bit. The Utica underlies the Marcellus in a lot of areas and Enservco gets some economics of scale there. [See map] Furthermore, management has been getting the word out more and also may be contemplating a reverse stock split and listing on another exchange.
Source: Marcellus Coalition
TER: What EP names on your coverage list look interesting?
PJ: We like Miller Energy Resources (MILL:NYSE; MILL:NASDAQ), which, in late 2009, captured former Pacific Energy Resources Ltd. assets out of bankruptcy that were valued at $500M for an outstanding $4.5M. Miller's entire enterprise value, meanwhile, is just $240M. Moreover, its infrastructure assets were valued by third parties on behalf of its lender at $190M. What makes these assets most attractive is the fact that recent well results indicate that original estimates by Forest Oil (which sold the properties to Pacific in 2007) may in fact be correct, which would mean that these Alaskan assets could contain 100200 million barrels (MMbbl) of recoverable oil reserves. Proved oil reserves presently stand at 8.61 MMbbl.
TER: How was Miller able to buy $500M worth of assets for less than 1% of their value? Even in bankruptcy, you'd think that there'd be buyers willing to pay more than that.
PJ: David Hall, a Miller Energy executive who had worked on the assets even before Pacific bought them from Forest Oil in 2007, was following the Alaskan bankruptcy proceedings. He got in touch with the CEO of Miller, Scott Boruff, and told him about these assets that were becoming available.
TER: Why does Miller believe that the original estimates of recoverable oil reserves may, in fact, be correct?
PJ: The thesis is that Forest Oil used the wrong completion techniques, which is why well performances had dropped off. The completion techniques Forest Oil used were in fact different from techniques used for other assets on the McArthur Trend. David Hall believed that workovers on existing wells, for example, replacing some electric submersible pumps and making changes to completion techniques on new wells, could improve production. Low and behold, that's exactly what's happened.
In addition, Miller just started doing sidetracks of some of these old wells. It posted a 21-day production test of its RU-2A well several weeks ago at 1,314 barrels per day, which would indicate that that the oil's there and it's recoverable. Management has been doing a good job of utilizing preferred equity to have substantial capital expenditure programs without diluting the common shareholders. To top it off, it has about 600,000 undeveloped acres that it's just starting exploration on as well.
TER: What other names look interesting?
PJ: I like Trans Energy Inc. (TENG:OTCBB), which is a pure play in the Marcellus Shale. The company holds about 20,000 net acres in the Marcellus, a substantial portion of which are in the core, liquids-rich part of the play. Operators, including Range Resources Corp. (RRC:NYSE), EQT Corp. (EQT:NYSE) and Gastar Exploration Ltd. (GST:NYSE), continue to increase their return assumptions for acreage adjacent to Trans Energy's. The company's production is set to ramp up as soon as Williams Companies Inc. completes the construction of certain infrastructure. Trans Energy's acreage is in northeast West Virginia, on the southwest Pennsylvania border. There's been a lot of success coming out of that area.
TER: What sort of strategy would you suggest our readers consider?
PJ: I think the micro-cap space, in general, is less correlated to the market's vagaries. Perceived changes in foreign interest rates, for example, have a larger effect on large-cap names. Micro-cap pricing is determined more by company-specific dynamics, such as anticipated future cash flows. Plus, a lot of micro-cap names and EPs in general seem to be more active on hedging, and therefore should be less susceptible to changes in commodity prices. As a result, investors that exercise due diligence should be rewarded for accurate cash flow predictions. If you want to find companies where your hard work can actually pay off, then the micro-cap space is a good place to look.
Micro caps seem to be getting more active in reaching new investors, and some of the management teams have regrouped from previous lives and are starting up very successful new companies. I think Bonanza Creek Energy Inc. (BCEI:NYSE) is a great example of management hailing from one company and getting back together and starting all over again.
TER: Thanks for talking with us today and giving us some interesting input, Phil.
PJ: I appreciate the opportunity.
Philip Juskowicz, CFA is a managing director in the research department at Casimir Capital, a boutique investment bank specializing in the Natural Resource industry. Juskowicz began his career at Standard Poor's in 1998, where he was one of the first analysts to recommend Mitchell Energy, credited with discovering the Barnett Shale. From 2001-2005, He worked with a former geologist in equity research at both First Albany Corp. and Buckingham Research. At Buckingham, Juskowicz was promoted to a senior oilfield service analyst position, leveraging his extensive knowledge of the EP space. From 2006-2010, he was an insider to the oil and gas industry, serving as a credit analyst at WestLB, a German investment bank. In this capacity, Juskowicz was responsible for $500M of loans to energy companies and projects. He earned a Master of Science in finance from the University of Baltimore.
Here is our complete disclosure
Phil Juskowicz: While I don't spend a lot of time predicting commodity prices, I personally see relatively stable short-term oil prices. Intermediate or long-term prices may weaken, assuming no supply disruptions arise from political upheavals, while gas prices may strengthen based on supply/demand fundamentals. We've seen continued oil supply growth and the short term market seems to be pretty range bound, having developed a good base around the $100 per barrel ($100/bbl) level.
TER: Where do you see some of the best investment opportunities in the oil and gas business?
PJ: Micro-cap exploration and production (EP) stocks have severely underperformed the SP Small Cap EP Index since the second half of 2011 (H2/11). However, the definition of "small cap" depends on who you're talking to. The Small Cap EP Index consists of companies around the billion-dollar range like Approach Resources Inc. (AREX:NASDAQ) and Northern Oil Gas Inc. (NOG:NYSE). Casimir has a micro-cap EP index, which is comprised of companies with market caps up to $500 million ($500M) with some names under $100M. That index level started to diverge in H2/11. Both of these groups consist of relatively equal gas/oil weightings, so the performance should not, in our opinion, be attributed to the relative strength of oil prices over gas that commenced around that time. As a result, we believe that there are attractive investment opportunities in the micro-cap EP universe.
Casimir Micro-Cap EP Index (White) vs. SP Small-Cap EP Index (Yellow)
Casimir Micro-Cap EP Index composed of: AMZG, ANFC, CAK, CPE, CXPO, EGY, EEG, ENRJ, ENSV, FEEC, FXEN, GMET, GNE, HDY, HNR, IFNY, IVAN, LEI, MCEP, MILL, MPET, MPO, OEDV, PHX, PNRG, PSTR, RDMP, SARA, SSN, STTX, TAT, TENG, TGC, TPLM, USEG, WRES, ZAZA
Source: Bloomberg; Casimir Capital
TER: How do you choose the companies in your coverage list?
PJ: We look for small companies that have largely flown "under the radar screen" and are underfollowed. The companies we cover have strong management teams and operate in premier areas with good assets that have substantial cash flow potential.
TER: Do you cover any service companies?
PJ: Enservco Corp. (OTCBB:ENSV) is on our "watch list". The company is the only nationwide provider of hot oiling, well acidizing and frack heating services generally used to coax oil out of the ground, for example to counter paraffin buildups. Enservco experienced healthy margins in Q2/13 despite it typically being a seasonally weak time for heating services. The company continues having to turn customers away in some areas while it builds out its fleet. Management, in our opinion, has a track record of building successful companies and its regional staff has strong relationships with EPs. The company is also expanding into other basins and successfully tapping into new revenue sources.
TER: Why aren't competitors seeing the opportunity here and moving in to get a piece of the action?
PJ: There are regional pockets of mom and pop shops that will do some of these services, but, a nationwide company like a Noble Energy Inc. (NBL:NYSE) might turn to Enservco because it already has a reliable relationship with Enservco's staff in different areas. Enservco's services account for a very low percentage of total well drilling and completion costs (it might cost around $100,000 to service a $7M well) so customers are not as likely to conduct competitive bidding processes. Instead, they choose to use a company with which the frontline managers already have existing relationships.
TER: So it has developed a national reputation, which is its competitive strength.
PJ: And it's building out the capacity as we speak. Enservco is expanding its already large presence in the Marcellus Formation. In its Q2/13 conference call, management said they were starting to see the Utica play out a little bit. The Utica underlies the Marcellus in a lot of areas and Enservco gets some economics of scale there. [See map] Furthermore, management has been getting the word out more and also may be contemplating a reverse stock split and listing on another exchange.
Source: Marcellus Coalition
TER: What EP names on your coverage list look interesting?
PJ: We like Miller Energy Resources (MILL:NYSE; MILL:NASDAQ), which, in late 2009, captured former Pacific Energy Resources Ltd. assets out of bankruptcy that were valued at $500M for an outstanding $4.5M. Miller's entire enterprise value, meanwhile, is just $240M. Moreover, its infrastructure assets were valued by third parties on behalf of its lender at $190M. What makes these assets most attractive is the fact that recent well results indicate that original estimates by Forest Oil (which sold the properties to Pacific in 2007) may in fact be correct, which would mean that these Alaskan assets could contain 100200 million barrels (MMbbl) of recoverable oil reserves. Proved oil reserves presently stand at 8.61 MMbbl.
TER: How was Miller able to buy $500M worth of assets for less than 1% of their value? Even in bankruptcy, you'd think that there'd be buyers willing to pay more than that.
PJ: David Hall, a Miller Energy executive who had worked on the assets even before Pacific bought them from Forest Oil in 2007, was following the Alaskan bankruptcy proceedings. He got in touch with the CEO of Miller, Scott Boruff, and told him about these assets that were becoming available.
TER: Why does Miller believe that the original estimates of recoverable oil reserves may, in fact, be correct?
PJ: The thesis is that Forest Oil used the wrong completion techniques, which is why well performances had dropped off. The completion techniques Forest Oil used were in fact different from techniques used for other assets on the McArthur Trend. David Hall believed that workovers on existing wells, for example, replacing some electric submersible pumps and making changes to completion techniques on new wells, could improve production. Low and behold, that's exactly what's happened.
In addition, Miller just started doing sidetracks of some of these old wells. It posted a 21-day production test of its RU-2A well several weeks ago at 1,314 barrels per day, which would indicate that that the oil's there and it's recoverable. Management has been doing a good job of utilizing preferred equity to have substantial capital expenditure programs without diluting the common shareholders. To top it off, it has about 600,000 undeveloped acres that it's just starting exploration on as well.
TER: What other names look interesting?
PJ: I like Trans Energy Inc. (TENG:OTCBB), which is a pure play in the Marcellus Shale. The company holds about 20,000 net acres in the Marcellus, a substantial portion of which are in the core, liquids-rich part of the play. Operators, including Range Resources Corp. (RRC:NYSE), EQT Corp. (EQT:NYSE) and Gastar Exploration Ltd. (GST:NYSE), continue to increase their return assumptions for acreage adjacent to Trans Energy's. The company's production is set to ramp up as soon as Williams Companies Inc. completes the construction of certain infrastructure. Trans Energy's acreage is in northeast West Virginia, on the southwest Pennsylvania border. There's been a lot of success coming out of that area.
TER: What sort of strategy would you suggest our readers consider?
PJ: I think the micro-cap space, in general, is less correlated to the market's vagaries. Perceived changes in foreign interest rates, for example, have a larger effect on large-cap names. Micro-cap pricing is determined more by company-specific dynamics, such as anticipated future cash flows. Plus, a lot of micro-cap names and EPs in general seem to be more active on hedging, and therefore should be less susceptible to changes in commodity prices. As a result, investors that exercise due diligence should be rewarded for accurate cash flow predictions. If you want to find companies where your hard work can actually pay off, then the micro-cap space is a good place to look.
Micro caps seem to be getting more active in reaching new investors, and some of the management teams have regrouped from previous lives and are starting up very successful new companies. I think Bonanza Creek Energy Inc. (BCEI:NYSE) is a great example of management hailing from one company and getting back together and starting all over again.
TER: Thanks for talking with us today and giving us some interesting input, Phil.
PJ: I appreciate the opportunity.
Philip Juskowicz, CFA is a managing director in the research department at Casimir Capital, a boutique investment bank specializing in the Natural Resource industry. Juskowicz began his career at Standard Poor's in 1998, where he was one of the first analysts to recommend Mitchell Energy, credited with discovering the Barnett Shale. From 2001-2005, He worked with a former geologist in equity research at both First Albany Corp. and Buckingham Research. At Buckingham, Juskowicz was promoted to a senior oilfield service analyst position, leveraging his extensive knowledge of the EP space. From 2006-2010, he was an insider to the oil and gas industry, serving as a credit analyst at WestLB, a German investment bank. In this capacity, Juskowicz was responsible for $500M of loans to energy companies and projects. He earned a Master of Science in finance from the University of Baltimore.
Here is our complete disclosure
Wednesday, August 28, 2013
Precious Metals & Miners Flash Short-Sell Signal
Today Chris is telling us that the good news is that the bottom has likely been put in for gold, silver and gold miners BUT the recent rally in these metals and miner looks to be coming to an end. While we could see another pop in price over the next week or so the price, volume and momentum seem to be stalling out.
What does this mean? It means we should expect short term weakness and lower prices over the next month or two.
Here are three charts Chris posted several months. Their forecast were based off simple technical analysis using cycles, Fibonacci and price patterns. As you can see we are not trading at our key pivot level which we expect selling pressure to start to increase and eventually overpower the buyers sending the prices lower.....Click here to see Chris' complete chart work and article.
Wednesdays market summary and a U.S. response. Wait for it, wait for it.
October crude oil closed higher on Wednesday as it extends this summer's rally. Profit taking tempered early session gains and the low range close sets the stage for a steady to lower opening when Thursday's night session begins. Stochastics and the RSI are bullish signaling that sideways to higher prices are possible near term. If October extends this summer's rally, weekly resistance crossing at 114.83 is the next upside target. Closes below the 20 day moving average crossing at 106.04 would confirm that a short-term top has been posted. First resistance is today's high crossing at 112.24. Second resistance is weekly resistance crossing at 114.83. First support is the 20 day moving average crossing at 106.04. Second support is the reaction low crossing at 103.50.
October Henry natural gas closed higher on Wednesday as it extended this month's rally. The high range close sets the stage for a steady to higher opening on Thursday. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near term. If October extends this month's rally, the 38% retracement level of the May-August decline crossing at 3.680 is the next upside target. Closes below the 20 day moving average crossing at 3.421 would confirm that a short term top has been posted. First resistance is today's high crossing at 3.628. Second resistance is the 38% retracement level of the May-August decline crossing at 3.680. First support is the 20-day moving average crossing at 3.421. Second support is August's low crossing at 3.154.
October gold closed lower due to profit taking on Wednesday as it consolidated some of the rally off June's low. The low range close sets the stage for a steady to lower opening when Thursday's night session begins trading. Stochastics and the RSI are overbought but remain neutral to bullish signaling that sideways to higher prices are possible near term. If October extends the aforementioned rally, May's high crossing at 1489.00 is the next upside target. Closes below the 20 day moving average crossing at 1346.80 would confirm that a short term top has been posted. First resistance is today's high crossing at 1432.90. Second resistance is May's high crossing at 1489.00. First support is the 10 day moving average crossing at 1383.50. Second resistance is the 20 day moving average crossing at 1346.80.
The September Dollar closed higher on Wednesday. The high range close sets the stage for a steady to higher opening when Thursday's night session begins trading. Stochastics and the RSI are neutral to bullish signaling that sideways to higher prices are possible near term. Closes above the reaction high crossing at 81.99 are needed to confirm that a short term low has been posted. If September renews the decline off July's high, June's low crossing at 80.61 is the next downside target. First resistance is the reaction high crossing at 81.99. Second resistance is August's high crossing at 82.61. First support is last Tuesday's low crossing at 80.77. Second support is June's low crossing at 80.61.
And last but not least.....September coffee closed higher on Wednesday as it consolidated some of this summer's decline. The high range close set the stage for a steady to higher opening on Thursday. Stochastics and the RSI are oversold but remain neutral to bearish signaling that sideways to lower prices are possible near term. If September renews this month's decline, monthly support crossing at 10.21 is the next downside target. Closes above the 20 day moving average crossing at 118.11 would confirm that a low has been posted.
Here's the Premier Trader University "Free Training Webinar" Schedule
SDRL - Seadrill announces second quarter 2013 results
Operating profit for the quarter was US$507 million compared to US$552 million in the preceding quarter. The decrease is driven by gain on sale of the West Janus in the first quarter, offset by lower operating and SG&A expenses during the second quarter.
* Seadrill reports its best operating results and net income ever and generated second quarter 2013 EBITDA*) of US$665 million
* Seadrill reports second quarter 2013 net income of US$1,750 million and earnings per share of US$3.68
* Seadrill increases the ordinary quarterly cash dividend by 3 cents to US$0.91
* Economic utilization for floaters increased to 94% in Q2 2013 from 92% in Q1 2013
* Economic utilization for the jack-up fleet in Q2 2013 was 98%, down from 99% in Q1 2013
* Seadrill secured a three-year contract for the newbuild drillship West Neptune with a total estimated revenue potential of US$662 million
* Seadrill realized a gain of US$1,256 million from the sale of the tender rig division to SapuraKencana Petroleum for a total consideration of US$2.9 billion
* Seadrill completed the sale of the tender rig T-15 to Seadrill Partners LLC (SDLP) for a total consideration of US$210 million
* Seadrill ordered two jack-ups for a total estimated project price of US$230 million per rig, with deliveries in 4Q 2015 and 1Q 2016
* Seadrill and SapuraKencana joint project secured an eight year contract for three Pipe Laying Support Vessels with a total estimated revenue potential of US$2.7 billion
* North Atlantic Drilling completes sale and leaseback transaction for the newbuild harsh environment jack-up West Linus for US$600 million
Subsequent events
* Seadrill appoints Per Wullf as CEO to take over from Fredrik Halvorsen
* Seadrill orders four ultra-deepwater drillships for an estimated project price below US$600 million per rig, with deliveries scheduled for the second half of 2015
* Seadrill orders two jack-ups for an estimated project price of US$230 million per rig, with deliveries in the second and third quarters of 2016, respectively
* Seadrill reaches 50.1% ownership in Sevan Drilling and launches mandatory offer for all outstanding shares which closed on August 22, 2013
* Seadrill secures a 180 day contract for the newbuild ultra-deepwater drillship West Tellus with a total estimated revenue potential of US$150 million
* Seadrill secures a 2.5 year contract for the jack-up rig West Freedom with a total estimated revenue potential of US$222 million
* Seadrill secures a one year contract extension with Talisman in Malaysia for the jack-up rig West Vigilant at US$167,000 per day
* North Atlantic Drilling is awarded an extension of the current drilling contract, in addition to a new drilling contract for West Navigator, securing employment to December 2014 with a total estimated revenue potential of US$98 million
Click here for complete earnings report and consolidated financial information
Here's a FREE Trend Analysis for SeaDrill....ticker SDRL
Tuesday, August 27, 2013
Volatility in Syria = Volatility in the Markets. Risk off is ON!
The U.S. stock indexes closed solidly lower today on profit taking and amid a “risk-off” day in the world market place The U.S. appears poised to take military action against Syria, possibly within 48 hours, after the Syrian government regime used chemical weapons against its citizens. World stock markets sold off Tuesday on the jitters regarding Syria. There are worries any U.S. military intervention in Syria could escalate into further instability and violence in the already volatile Middle East. Emerging country financial markets and currencies also saw strains Tuesday amid the risk aversion in the market place. The Indian rupee hit another record low versus the U.S. dollar Tuesday.
October Nymex crude oil closed up $3.04 at $108.97 today. Prices closed nearer the session high today and hit a fresh contract high. Syria tensions have pushed oil sharply higher following U.S. Secretary of State Kerry's harsh condemnation of Syria Monday afternoon. Crude oil bulls have the strong overall near term technical advantage. Prices have now seen a bullish upside “breakout” from the choppy and sideways trading range at higher price levels.
December gold futures closed up $26.50 an ounce at $1,419.70 today. Prices closed nearer the session high and hit a nearly three month high today. Safe haven buying was featured, along with fresh technical buying interest. The key “outside markets” were also bullish for the gold market today, as the U.S. dollar index was lower and crude oil prices were sharply higher. The gold market bulls have the near term technical advantage. A two month old uptrend is in place on the daily bar chart.
October natural gas closed up 2.4 cents at $3.577 today. Prices closed near the session high. The nat gas bears still have the overall near term technical advantage. However, the bulls have gained a bit of upside momentum.
The September U.S. dollar index closed down .271 at 81.170 today. Prices closed near the session low. The greenback bears have the overall near term technical advantage. Prices are in a seven week old downtrend on the daily bar chart.
And you just have to know that we can't resist talking about coffee. December coffee closed down 110 points at 116.65 cents today. Prices closed near the session low today as prices hover near the recent contract low. The key “outside markets” were fully bullish for the coffee market today as the U.S. dollar index was lower and crude oil prices were sharply higher. Yet, the coffee market bulls could get no traction, which is another bearish clue for coffee. The coffee bears have the solid overall near term technical advantage.
Don't miss this weeks webinar with Scott Andrews....Just click here to enroll!
October Nymex crude oil closed up $3.04 at $108.97 today. Prices closed nearer the session high today and hit a fresh contract high. Syria tensions have pushed oil sharply higher following U.S. Secretary of State Kerry's harsh condemnation of Syria Monday afternoon. Crude oil bulls have the strong overall near term technical advantage. Prices have now seen a bullish upside “breakout” from the choppy and sideways trading range at higher price levels.
December gold futures closed up $26.50 an ounce at $1,419.70 today. Prices closed nearer the session high and hit a nearly three month high today. Safe haven buying was featured, along with fresh technical buying interest. The key “outside markets” were also bullish for the gold market today, as the U.S. dollar index was lower and crude oil prices were sharply higher. The gold market bulls have the near term technical advantage. A two month old uptrend is in place on the daily bar chart.
October natural gas closed up 2.4 cents at $3.577 today. Prices closed near the session high. The nat gas bears still have the overall near term technical advantage. However, the bulls have gained a bit of upside momentum.
The September U.S. dollar index closed down .271 at 81.170 today. Prices closed near the session low. The greenback bears have the overall near term technical advantage. Prices are in a seven week old downtrend on the daily bar chart.
And you just have to know that we can't resist talking about coffee. December coffee closed down 110 points at 116.65 cents today. Prices closed near the session low today as prices hover near the recent contract low. The key “outside markets” were fully bullish for the coffee market today as the U.S. dollar index was lower and crude oil prices were sharply higher. Yet, the coffee market bulls could get no traction, which is another bearish clue for coffee. The coffee bears have the solid overall near term technical advantage.
Don't miss this weeks webinar with Scott Andrews....Just click here to enroll!
Monday, August 26, 2013
Thoughts from the Frontline.....France: On the Edge of the Periphery
By John Mauldin
"The emotional side of me tends to imagine France, like the princess in the fairy stories or the Madonna in the frescoes, as dedicated to an exalted and exceptional destiny. Instinctively I have the feeling that Providence has created her either for complete successes or for exemplary misfortunes. Our country, as it is, surrounded by the others as they are, must aim high and hold itself straight, on pain of mortal danger. In short, to my mind, France cannot be France without greatness.
– Charles de Gaulle, from his memoirs
In the Eurozone there was no mechanism by which exchange rates could be used to balance the labor-cost differentials between the peripheral countries and those of the northern tier. And then there's France. I've been writing in this space for some time that France has the potential to become the next Greece. I've spent a good deal of time this past month reviewing the European situation, and I'm more convinced than ever that France is on its way to becoming the most significant economic train wreck in Europe within the next few years.
We shifted focus at the beginning of the year to Japan because of the real crisis that is brewing there. Over the next few months I will begin to refocus on Europe as that train threatens to go off the track again. And true to form, this wreck will be entirely due to human error, coupled with a large dollop of hubris. This week we will take a brief look at the problems developing in Europe and then do a series of in-depth dives between now and the beginning of winter. The coming European crisis will not show up next week but will start playing in a movie theater near you sometime next year. Today's letter will close with a little speculation on how the developing conflict between France and Germany and the rest of its euro neighbors will play out.
France: On the Edge of the Periphery
I think I need first to acknowledge that the market clearly doesn't agree with me. The market for French OATS (Obligations Assimilables du Trésor), their longer-term bonds, sees no risk. The following chart is a comparison of interest rates for much of the developed world, which I reproduce for those who are interested in comparative details. Notice that French rates are lower than those of the US, Canada, and the UK. Now I understand that interest rates are a function of monetary policy, inflation expectations, and the demand for money, which are all related to economic growth, but still….
France's neighbors, Italy and Spain, have rates that are roughly double France's. But as we will see, the underlying economics are not that much different for the three countries, and you can make a good case that France’s trajectory may be the worst.
"No: France Is Not Bankrupt" – Really?
We will start with a remarkable example of both hubris and economic ignorance published earlier this year in Le Monde. Under the headline "No: France Is Not Bankrupt," Bruno Moschetto, a professor of economics at the University of Paris I and HEC, made the following case. He apparently wrote this with a straight face. If you are not alone, please try not to giggle out loud and annoy people around you. (Hat tip to my good friend Mike Shedlock.)
No, France is not bankrupt .... The claim is untrue economically and financially. France is not and will not bankrupt because it would then be in a state of insolvency.
A state cannot be bankrupt, in its own currency, to foreigners and residents, since the latter would be invited to meet its debt by an immediate increase in taxation.
In abstract, the state is its citizens, and the citizens are the guarantors of obligations of the state. In the final analysis, "The state is us." To be in a state of suspension of payments, a state would have to be indebted in a foreign currency, unable to deal with foreign currency liabilities in that currency….
Ultimately our leaders have all the financial and political means, through the levying of taxes, to be facing our deadlines in euros. And besides, our lenders regularly renew their confidence, and rates have never been lower.
To continue reading this article from Thoughts from the Frontline – a free weekly publication by John Mauldin, renowned financial expert, best-selling author, and Chairman of Mauldin Economics – please click here.
Sunday, August 25, 2013
Trading the "Opening Gap" in the Crude Oil Market
A few days ago we posted a compelling video explaining two unique
benefits of trading the crude oil market. If you missed it, here it is again.
On Wednesday, August 28th, our trading partners at Master The Gap will share a comprehensive research study for trading the opening gap in oil.
Learn More Now
During this 1 hour event, a wide range of time frames and scenarios will be reviewed showing what has worked best over the past 6+ years. Detailed templates will be included that can be used to create your own actionable gap trading blueprints.
Whether you are already trading oil or interested in starting, this special event and research study can help you create a solid trading plan based on what has worked over the past 1500+ trading days.
Get Started Today!
So why not learn how to trade Crude Oil with history on your side?
On Wednesday, August 28th, our trading partners at Master The Gap will share a comprehensive research study for trading the opening gap in oil.
Learn More Now
During this 1 hour event, a wide range of time frames and scenarios will be reviewed showing what has worked best over the past 6+ years. Detailed templates will be included that can be used to create your own actionable gap trading blueprints.
Whether you are already trading oil or interested in starting, this special event and research study can help you create a solid trading plan based on what has worked over the past 1500+ trading days.
Get Started Today!
So why not learn how to trade Crude Oil with history on your side?
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