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Oil Drillers get Drilled

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As a fresh supply of crude oil keeps finding its way into the market, oil stocks continue to slip.

Oil Services Index Daily Chart

The Oil Service Index (OSX.X) tried to hold around the 120 area, but when that area was lost, it sank faster than the Exxon Valdeze. The last area of support was the long-standing up trend that was penetrated yesterday, and now OSX looks set to give back all of this years gains by falling to 103.

Halliburton Daily Chart

For those Premier Market readers who were following Halliburton, we will be dropping coverage on both the October calls and the July calls used to cover the position since our stop at $38.50 was hit today. Yesterday HAL closed the gap that formed on 4/26/01, but managed to hold above the 61.8% retracement level at $38.72. That level was lost this morning, and stopped us out of our position. At least prices at the pump should be coming down in the coming weeks.

Jeffrey Canavan
Assistant Analyst

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