New York, New York (PressExposure) May 08, 2012 -- Sasha Cekerevac, editor for Penny Stock Detectives, believes that oil prices will remain high for a long period of time for a number of reasons, including increasing world population and the explosive growth of car buying in Asia. In a recent Penny Stock Detectives article, Cekerevac points out that many junior energy companies are taking advantage of high oil prices by searching for wells at an accelerated rate, in order to profit from the high prices.
"One of the more interesting penny stocks involved in deep offshore oil drilling is Vantage Drilling," notes Cekerevac. "The company takes advantage of high oil prices by providing firms with offshore drilling rigs that are capable of working in water up to 10,000 feet. Vantage just took possession of one of the most state-of-the-art, deep-sea offshore drilling rigs that it has already have contracted out. The Company's current backlog is approximately $2.8 billion."
According to Cekerevac, when taking a look at the technical analysis of Vantage Drilling, if we look at the Fibonacci retracements, there are some very bullish signs. The analyst notes that he personally uses the open and close of the bars rather than the highs and lows for determining retracement points, as he believes this information is more definitive when using technical analysis. From the lows in January to the highs in March, the stock has pulled back to a key Fibonacci level: the 38.2% retracement. Cekerevac also advises someone looking at technical analysis that, if an indicator has met with previous significance, the confidence of future importance is greatly enhanced. This 38.2% level that Vantage has seen as support was also a key resistance level on the way in late February. In technical analysis, says the analyst, what was once resistance becomes support and vice versa.
When Cekerevac looked at Vantage Drilling in his recent article, he saw that the most likely scenario is of a trading range occurring for a period of time, although the overall trend is still bullish. A break above the $1.70 level is going to be considered significant for the bullish case, while a break below $1.25 would be quite bearish, in Cekerevac's opinion. More technical analysis is needed to define exact entry and exit points, says the analyst, in addition to what oil prices are doing. Even though technical analysis is a good tool to use, it's only one in your toolbox. At the end of the day, Cekerevac notes, the company needs to be well run for the price to go up, so combining both technical analysis and fundamental analysis is your best bet at being a successful investor.
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The editors of Penny Stock Detectives believe that low-priced stocks, when researched properly, present investors with great opportunities to accumulate wealth and to increase the value of their investment portfolios. You can learn more about Penny Stock Detectives at www.pennystockdetectives.com.
Sasha Cekerevac, BA, and Danny Esposito, B. Comm., lead editorial stock analysts at Penny Stock Detectives, in conjunction with stock market guru George Leong, B. Comm., have just updated their breakthrough video, If You Missed Apple, Shame on Us; If You Miss This... which highlights a company these stock analysts believe looks very similar to Apple Inc. in its early days. To see the video, visit: [http://www.pennystockdetectives.com/video/pt/index.php?sb=PRESS].