Looks like the energy sector is starting to get energized. Here’s a trading idea for using diamonds to make money. Check out Diamond Offshore (DO). (August 29, 2015)
Diamond Offshore Drilling ( NYSE:DO ), the weekly chart, very compelling, right? I guess it can be, but this frankly looks a whole lot like this, and this, and all that. This is what I want to show you, the daily chart. The daily chart actually shows a kind of completed “W” pattern here. I’m looking at this “W” pattern; finally we get a move back up above the apex here on the middle of the “W”. So this is a completed “W” pattern and at the same time a breakout above the 50-day moving average.
This is important; this is a stock that’s trying to build a base. Other energy stocks ( NYSE:CVX ), they haven’t been trying to build a base they’ve been trying to find the bottom, and have been struggling to do so. But with Diamond ( NYSE:DO ), this actually, really I would say it found the bottom here. Because if you look at how it closed within the Bollinger Bands, most of these closes are supposed to be inside the bands, this had been drifting down lower. Then on this last pullback it never really came down to the lowest band. And then on this day everything else was imploding, why not Diamond Offshore ( NYSE:DO )? But it quickly moved up above here.
So what I’m telling you is this, there are buyers here. And there’s also volume picking up. Not one big, massive volume spike like some of these companies, but volume is definitely picking up on these moves. I think Diamond Offshore ( NYSE:DO ) is something that you can be buying right now. If it happens to pullback next week the closer you can get it to 22.00 or 21.00 the better it is. But what I’m telling you is, I think this stock is done going down.
Now, I could make some cheesy comment about this being a “diamond in the rough” and all that stupid stuff, but I’m not going to do that. All I’m going to tell you is I think this stock has pretty much hit the bottom. You could easily see another 10 or 15 percent move just before it really gets up to a point where maybe buyers are going to dry up and sellers are going to be moving in. So look at Diamond Offshore ( NYSE:DO ), I think it’s going to work with you.
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