Monday Morning Pause

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See the Wrap for last week here

The Week Ahead:

  • Monday 2/8: No ecodata release scheduled
  • Tuesday 2/9: Wholesale inventories
  • Wednesday 2/10:  Trade balance (Forecast -$35.7, last -$36.4B), budget balance, EIA Oil Inventory Report,
  • Thursday 2/11: Jobless claims (F = 460K), retail sales (F = 0.3%), retail sales ex autos (F = 0.6%), inventories (F = 0.0%), EIA Natural Storage Report,
  • Friday 2/12: Consumer sentiment (F = 76, last 74.4)

In Today's Post:

  • Holdings Watch
  • Commodity  Watch
  • Stuff We Care About Today
  • Earnings Calendar - Week 3
  • Odds & Ends

Holdings Watch:

  • $10KP II:
    • $11,100
    • 27% Cash.
  • The Quickview on the Holdings tab has been updated.

Commodity  Watch:

Crude oil eased 2% last week to close at $71.19, recovering on Friday below key support at $70 after briefly dipping to $69.50. The 12 month crude strip is now trading at $73.64. This morning crude is up slightly.

  • "Doesn't Play Well With Others" Watch: On Sunday, Ahmadinejad announced that he was kicking off further uranium enrichment. Iran is currently enriching to 3.5% purity and wants to go to 20%. 80% is bomb threshold material. The U.S. and Germany threatened new sanctions (there are already 3 sets of sanctions in play at present). U.S. Secretary of Defense Gates said that "Iran may still yield to coordinated sanctions" but I have to think the microphone missed the beginning of that sentence which must have been "there is a snowball's chance in hell that...". And in its usual fashion, China has already argued against further sanctions.


Natural gas rallied 7% last week to close at $5.52 ... we remain range bound despite a recent attempt to drop through $5 just before the supply numbers hit at the end of January. The 12 month strip is now trading at $5.93. This morning gas is trading up a little better than a dime as the forecast shows snow storm after snow storm for big swaths of the U.S.

  • Weather Watch: A Return of the cold. Accuweather plots the next two weeks as colder than normal for at least 80% of the U.S. Joe Bastardi of Accuweather thinks the cold could persist into March and if that occurs, look for storage to break through the 1.5 Tcf mark by the end of the withdrawal season which will help to support gas above $5 into the shoulder season as we look to make the transition to summer demand, a summer that just about has to see higher generation based demand (whether or not gas demand will be up as a result will largely be a function of gas and coal prices).

    • Week Before Last: 217 HDDs which was in line with normal temps and yielded last Thursday's smallish looking 115 Bcf withdrawal report.
    • Last Week: 225 HDDs vs a prior forecast of 210; 219 last year and 215 normal.
    • This Week's Forecast: 227 HDDs vs 206 normal and much colder than last year's 143.



Stuff We Care About Today

RRC Sells Properties To EVEP

  • Appalachian data point: 78.8 Bcfe for $151.8 mm or $1.92 / Mcfe ... probably a good deal for both as RRC gets a decent price for non core reserves that it can plug back into its higher return Marcellus program and EVEP gets long life and fairly low cost assets to bolster its annuity machine, again at a not too high price.


CRED Updates Bakken

  • First Bakken well, a 9,200 ' foot lateral is about to be completed on the Fort Berthold Reservation; I don't care so much as it pertains to CRED but a successful (higher rate) long lateral on the reservation could give KOG a shot in the arm. 
  • I'd expect to see results in the next couple of weeks here.

Conference Watch: Next week, Feb 17th and 18th, Enercom Oil and Services Conference - see schedule here - EXXID, WLL, LINE, and other interesting names.

Earnings Watch

So far, earnings to date have been for the most part better than expected from coals to service to the few E&Ps that have reported. The market backdrop has overridden any resulting moves from the numbers or the outlooks so at this point its not really fair to say its been a "buy the rumor, sell the news" type of season as much as its been a "holy crap, look how fast the S&P is falling" type of season.


Odds & Ends

Analyst Watch:

  • HK - UBS raises target by $2 to $30, rating Buy
  • HK cut to Market Perform at Bernstein
  • XOM raised to buy at Collins Stewart
  • FSLR target cut $10 to $125, rating Hold at Deutsche
  • NFX target bumped $4 to $55 at Credit Suisse
  • FST and PXP targets upped $2 each to $30 and $36 respectively at Credit Suisse

Interesting Reading Watch:

121 Responses to “Monday Morning Pause”

  1. 1
    BirdsofpreyRcool Says:

    Good morning.

    TechTrader is uncommitted today.

    HeadTrader thinks we rally, if we open negative first.

    TED is saying Greece/Portugal/Spain will be resolved (and “no big deal” in the meantime). Spread between 3-month cash LIBOR minus USTs at new low, 15.37 bps. But, mainly b/c LIBOR has stayed flat while treasury yields have ticked up a bit.

  2. 2
    BirdsofpreyRcool Says:

    Morgan Stanley out with a macro comment on energy — saying commodities slump is due to a USD rally and presents a “buying opportunity.”

  3. 3
    zman Says:

    Good morning and thanks much BOP. Not a whole lot of news out of energy land this morning, positive guidance out of XEC but little else that’s really newsworthy and certainly the RRC/EVEP deal does not qualify on the merger front.

  4. 4
    BirdsofpreyRcool Says:

    Credit CDS indices are wider this morning… indicating that at least some of the Credit Bears are still trying to press their case.

    IG +2.75 bps to 104.5

    HY -0.25 points to 96 (not much of a Big Scary Move here)

  5. 5
    BirdsofpreyRcool Says:

    Well, we are certainly getting HeadTrader’s prefered open this morning. If he’s right, then this will turn around and rally, at some point.

  6. 6
    BirdsofpreyRcool Says:

    IG +3 bps now… Bears still pressing.

  7. 7
    zman Says:

    BOP – opening volumes are very light in the group, for some of the dips I’m seeing. Stands to reason it could easily be turned but yes, all eyes are on the dollar.

    BEXP – thinking news out there in the next two weeks, this time with a long lateral over in Ross, doesn’t delineate acreage there as its practically on top of past good wells but it’s longer with more stages so if effective there it’s like you see all future BEXP completions go to the 28 to 32 stage range where they aren’t limited by faults/lease lines.

  8. 8
    BirdsofpreyRcool Says:

    BBEP/KWK BreitBurn Energy settles all outstanding litigation with Quicksilver, reinstates distributions (13.35)

    BreitBurn announced today that all litigation between the partnership and its directors and Quicksilver Resources Inc. has been settled. BreitBurn also announced its intention to reinstate quarterly cash distributions at the rate of $0.375 per quarter, or $1.50 on an annualized basis, beginning with Q1 2010 distribution. The partnership intends to pay this distribution on or before May 15, 2010. As part of the settlement, the the partnership has also agreed to pay Quicksilver the sum of $13M and expects this sum to be paid by insurance. However, discussions with the partnership’s insurers are ongoing.

  9. 9
    BirdsofpreyRcool Says:

    Just posted the BBEP news b/c it’s a slow news day. Life is too short, to get into a relationship with some management teams… just ask KWK.

  10. 10
    zman Says:

    BOP – and we got the second snow of the year here last night, unexpected and somewhat rare this far south to get two in a season. Third on the way later in the week. That Bastardi has been just about spot on this winter. Looking for a cold rest of Feb and maybe into March now.

  11. 11
    BirdsofpreyRcool Says:

    Should be an interesting week for the Davy Jones Triad. Expect we will hear buzz and rumors before the actual announcement is put out, toward the end of this week. DJ hit TD last week and is doing their final suite of logging runs. If all goes right (over 5.5 miles of hole, mind you), then should be able to give us an update Thurs or Friday.

  12. 12
    zman Says:

    BOP – saw it, meant to comment as well. Good for KWK. It would be better for them if they could monetize their interest in BBEP (and walk away). Everyone is now watching the ROSE Montana Bakken wells over at NFX and at KWK. Rumor has it KWK has two wells drilling up in the same northwest corner of the Montana but I haven’t been able to find a company comment on it.

  13. 13
    zman Says:

    Re 11 – words you don’t want to hear: fish, stuck tool, reamer.

  14. 14
    BirdsofpreyRcool Says:

    I think Bastardi and Punxatawny Phil are in regular communication.

  15. 15
    zman Says:

    Speaking of the triad, MMR selling off a bit this am, probably just volume that buys for the weekend thinking Monday announcement, doesn’t get it and will reload again later. Thing is with these guys you never really know when they’ll put out a pr. Things take time this deep with this much pressure and heat. Things that sound like a week can take four. Conversely, they got the last pr out in record time.

  16. 16
    BirdsofpreyRcool Says:

    IG CDS index now +3.5 bps… still pressing….

  17. 17
    zman Says:

    BOP – good comments on TED on Friday comments section by the way.

  18. 18
    BirdsofpreyRcool Says:

    #15 — good point. Always have to keep that in mind. The scale and engineering feat at DJ is just mind-boggling. Any time you drill, it’s an opportunity for something to go wrong. Now, just multiply that by about 50 for the Davy Jones well. 5.5 miles takes you a long time to drive in traffic… imagine having to deal with that distance, only in 400 degree weather. Yikes.

  19. 19
    zman Says:

    For those of you who are interested in the logistics of drilling, including drilling, testing and completion I recommend chapters 17 to 20 in:

    Nontechnical Guide to Petroleum Geology, Exploration, Drilling and Production

  20. 20
    BirdsofpreyRcool Says:

    TED was my main guide, throughout 2007-2009. When it blew out to almost 500 bps, I thought the world would end.

    Just for reference sake, the median on the 3-month cash TED is about 20bps. So, I expect this index to widen out a bit and not indicate anything terribly scary.

  21. 21
    zman Says:

    NFX – Boothby, current president, to take chairman role aw well from Trice, a plus in my book.

    A few stocks in the group trying to wake up, but mostly just inconsequential noise in both directions until the S&P makes up its mind.

  22. 22
    BirdsofpreyRcool Says:

    IG still at +3bps from Friday’s wider close. Would like to see this start to tighten back here.

  23. 23
    BirdsofpreyRcool Says:

    Hmmmm… not gonna happen yet… +3.25

  24. 24
    zman Says:

    More on the Iran thing:


  25. 25
    Jerome Blank Says:

    KWK…holding lower trendline support on a developing daily ascending triangle…and it’s right at P&F trendline support…if your bullish on KWK, this is an easy spot to manage…

    Charts and comments added…


  26. 26
    zman Says:

    BOP – you know I don’t recall too many positive days in the last year or so for equities when we have no economic data release.

    Thanks JB. I had been expecting ROSE to be the first name with Southern Alberta Bakken results (north Montana) but it’s possible KWK has something with their 4Q press release which may come out first. Haven’t seen the dates for either just yet.

    I also expect to see some action in the Eagle Ford names this week with the EOG release. EOG has never admitted to their plans or acreage size in the EFS but word on the Street is they have four rigs running and a size position and will have well news in this week’s press release. Look for PXD, HK, SFY, ROSE, and to lessor extent APC and CHK to be affected.

  27. 27
    BirdsofpreyRcool Says:

    IG index tightening a bit with stocks up… if stocks rally, I think you will see credit follow. There are still some bearish positions that need to be unwound, if it turns the other direction. Snap-back could set a bear-trap, for the slow-moving, greedy ones, who did’nt unwind on Friday.

  28. 28
    jiveyjr Says:

    I reviewed JB’s charts while watching the Super Bowl…that chart book is getter better all the time…thx

  29. 29
    sunshine Says:

    Voted 🙂

  30. 30
    bloodystupidjohnson Says:

    VTR: Cardium basin — I think instead of picking one, the best way in this case, is to take a basket approach. I know purist stock pickers hate this, but so be it.

    My basket comprises BXE/WTL/NAL/MEL/BNE — I also own PWE. It so happens on Friday I did buy a little more of NAL and WTL. I am a buyer of the above on any stock weakness.

    If you had to twist my arm probably my fav Jrs are BXE/WTL — but don’t hold me to that — reason for a basket of stocks. PWE is the 800 lb gorilla in the group which I also like ALOT.

    Even though I am not a real big fan of brokerage reports, the Canadian brokers like Peters, BMO, etc do a nice job of following the Cardium play.

  31. 31
    Jerome Blank Says:

    EXXID back into x’s, MMR needs to print $15.50 to reverse back into x’s…

    Re: #28, 29…jiveyjr and sunshine, thanks much…jiveyjr, thank you for the feedback e-mail last night and comments…

  32. 32
    zman Says:

    EXXID – getting a boost here, best in show at present for the triad on the day, close to it for the group as well.

    That CRED well is a Petro-Hunt operated well on the reservation, about 6 sections west and 3 north of KOG’s Moccasin Creek wells. So this extended lateral is not far from KOGs 1 and 2 wells and from its yet to be released 10 and 11 wells.

  33. 33
    jiveyjr Says:

    really liked the bullish percentage charts and your comments regarding them…excellent

  34. 34
    bloodystupidjohnson Says:

    RE: Flores — SAT RE:2 Don’t forget, because of the haynesville mess and the extreme damage it did to PXP balance sheet, PXP had to sell its other 50% interest in the Permian basin to OXY on the cheap. OXY gave a price of 500 million on a take it or leave it basis. This was a fire sale on PXP part of a valuable piece of property.

  35. 35
    zman Says:

    BSJ – and I’d give that same kind of credit to Bob Simpson at XTO for entering into the plays late, at the peak, for a premium. Makes sense that XOM, who likes to pay top dollar for things, bought that one instead of an EOG who has stealthily entered the same plays.

  36. 36
    Jerome Blank Says:

    ROSE…for folks holding ROSE shorter term, keep an eye on the 50 day SMA which is right at channel support, as you can see from the charts, the 1/2 pt box size already puts ROSE on a P&F sell signal, so I’d really like to see intraday supprt come into paly at about $19. if this breaks, evaluate stops and look reenter if taken out of the trade…

  37. 37
    zman Says:

    Crude and natural gas acting better than the broad market, service and then E&P uniformly green. Energy has slightly underperformed the broads so a little catchup is in order. Numerous TA types over the weekend calling 1067 on the S&P major resistance.

  38. 38
    Jerome Blank Says:

    RE: #36 sorry for typos, writing too fast…

  39. 39
    choices Says:

    slow news day item.

    I have heard of this guy but do not know his track record:FWIW, he likes ATW.


  40. 40
    bloodystupidjohnson Says:

    Z: In view, over the years, Bob Simpson did a fabulous job of directing XTO, EXCEPT for the last few years. He paid the absolute peak prices for those properties. Then he had the nerve to try to justify them in conf calls and industry presentations. If the other parts of XTO were not so well run (production, hedging, etc) these actions would have caused XTO serve problems down the road.

  41. 41
    zman Says:

    BSJ – I hear ya on all of that.

  42. 42
    bloodystupidjohnson Says:

    In praise of Aubrey: One man who has down a great job of running a company is Aubrey over at CHK. He sold pieces of his shale plays at great prices, especially when one considers the market those assets where sold into. Those sales prevented serve fiancial problems at CHK. Of course he put the company into the problem, but he did a magical job of bailing it out.

  43. 43
    zman Says:

    Jerome – do you have any thoughts on EOG, earnings Wednesday, stock has been playing in a channel and did not fill the December XOM for XTO gap? I’m long the $100s at present and am looking for a number of potential catalysts on the call. Historically speaking, the stock has sold off on earnings, not due to a miss but because the stock had generally run up into the announcement. Given their current “not too expensive status” just wondering if you agree that it looks like its headed back to $100.

  44. 44
    zman Says:

    BSJ – can’t disagree that over the years he has built a machine of a gas company. Very good track record of early entry and high priced monetizations. I gave up my role as Aubrey apologist last year however when he sold the maps and paintings to the company and when they gave him the $75 mm deal to carry on with his working interest position. People hate that stuff although honestly, its a five year deal and not out of line with other guys in similar situation’s bonuses and doesn’t matter to the company in the big scheme of things (that’s like 10 Haynesville wells) to a company that during that span will drill hundreds but again, I won’t defend him for that stuff.

    Greening of the group continues, MMR has shrugged off the Friday for Monday sellers now as well.

    NFX – another name with near term catalysts – earnings next week and big granite wash wells and at least one Bakken well that should impress plus the plan for 2010, anyway, like how the chart is setting up there too.

  45. 45
    zman Says:

    S&P at 1070, through what some were calling major resistance at 1067.

  46. 46
    BirdsofpreyRcool Says:

    Credit indices supporting the stock market rally here.

    IG +1.75 bps

    HY down only 0.25 pts now.

  47. 47
    BirdsofpreyRcool Says:

    (reminder… you want to see a minus number in front of the IG change and a plus number in front of HY. IG is quoted in yield, so higher yield is worse. HY is quoted in points, like stocks, so higher points means lower yield means rally.)

  48. 48
    bloodystupidjohnson Says:

    Z: the thing that I really HATED that Aubrey did was those knock out hedges. You think CHK was hedge at X price of gas, when low and behold they were not. That was just plain stupid. Hedges are put on for a reason, and trying to make a few extra cents or show how smart you are, is not one of them.

  49. 49
    zman Says:

    BSJ – That took us all surprise although the saving was more than a few cents and when they put them on, nobody believe gas would fall that far. Now we all are believers, lol.

  50. 50
    zman Says:

    Snow bucketing down here now, just doesn’t happen more than once a decade, damn global warming, ahem, I mean climate change.

  51. 51
    bloodystupidjohnson Says:

    Weather forecasters: Fri at 6PM the local weather forecasters was saying that we would get 2 to 4 inches of snow. Twelve hours latter and 13 inches of snow latter the same forecaster came on TV and said — “well the storm went as PLANNED”.

  52. 52
    Jerome Blank Says:

    RE: #43 EOG…Zman, I see the channel…EOG is currently on a P&F sell signal, but is holding P&F trendline support which remains in place untila a print thru $89… and right now EOG is still holding up nicely above the lower channel line on the candlstick…from here EOG goes back into X’s if it can get back to print $94, this would imporve the technical picture quite a bit…to get to $100 EOG would need to break a new P&F buy signal, but there is tough resistance now at $98…and this might be a challenge given the bullish percent environment… I added charts and comments to get a better visual on the technical picture….


  53. 53
    milepost_43 Says:

    BEXP Feb 15s…I blinked….now playing with “their” $$…thanks Z…..

  54. 54
    zman Says:

    Jerome – thanks much and I voted.

    MP – thanks and nice to see it moving back in the right direction. One more day like today and I’ll be a bit more comfortable…I should add while it’s possible they release news next week I would be they wait for the earnings release. I think they will only have 1 well ready to talk about next week…. and then four month in about 3 weeks.

  55. 55
    Jerome Blank Says:

    RE: #54, Zman, thank you…

  56. 56
    bloodystupidjohnson Says:

    ELI: remember FRI and the choice between TRGL and ATPG — well at least over the last two days, the choice should of been ATPG — lol.

  57. 57
    RobBanks Says:

    Z – newbie question. Why is lateral length and number of sections important?

  58. 58
    zman Says:

    Rob – good question. The idea is that you are drilling one vertical well and then a lateral section into the productive zone. The longer the lateral, the more of the target zone, in this case the middle Bakken, you are exposiing the wellbore to. If you think of a vertical well that essentially would just punch through the zone and only tap the area proximate to the well bore as it cross that zone, you can then think that bending into the zone and then running along it would expose more of the wellbore to the zone. So essentially, and this is an oversimplification, you are doing, with the lateral, the work of several vertical wells. The number of frac stages or the distance between them really is what they want to optimize. You are piercing the casing of the well every so often to tap the oil from around the wellbore, so you perf the casing and frac the rocks, propping them open with proppant (generally sand) to let the hydrocarbons flow into the well in the most efficient manner possible. The early wells in this area would have one large uncontrolled frac but in the last 2 to 3 years, operators have refined their techniques, increasing the number of fracs and the length of the wellbore. As long as the reserves per additional frac outweighs the costs of said frac, it makes sense (assuming that you aren’t running into technical problems of pulling so many fracs off at the same time.

  59. 59
    zman Says:

    Got this from JD in an email regarding the SOX (and since the SOX or the techs have been said to have been the leadership since March I thought I’d post it.

    SOX looks good: MACD already low, RSI bounced 2x, red 200day rising at 305.

  60. 60
    elduque Says:

    Its really cold here this morning- temp got down to 55.


  61. 61
    RobBanks Says:

    RE 58.

    Thanks for the detailed explanation, that cleared up some missing parts of my understanding.

    What I’m also wondering is why the PR’s and presentations give the lateral length and number of sections. Is this just to give some details and color? I’m thinking as investors we care about BOED and EUR and cost of the wells – are the lengths and stages and sections nice to know numbers, or do they help investors come up with valuations?

  62. 62
    zman Says:

    Rob – gotta step out for a minute but in a nutshell, they are telling you the length and the frac # to give you a sense that they are getting more bang for the buck. Really what we should care about is the EUR, the IP as IPs are short lived and many of these wells will be off by 80% at the end of year 1 (with long lives however), maybe recovering 1/2 to 2/3 of the ultimate reserves in the first year and depending on prices, paying out in pretty short order (often under 2 years). So yes, it’s generally just helpful color. If BEXP says their next ROSS well is a 30 stage frac and I know the last one on the east of that was an 18 stager and the one to the northwest was a 24 stager, and this is not some step out but close to those two wells, then I can expect to see a bigger IP, barring something strange.

  63. 63
    RobBanks Says:

    OK, thanks!

  64. 64
    BirdsofpreyRcool Says:

    Desk Update – equities hang in OK, but desk is pretty quiet to start the week. There hasn’t been a lot of follow through to Fri’s late-session rally (a lot of which was short covering). That said, the large vanilla selling from last Thurs and early Fri hasn’t appeared yet either and shorts aren’t being as aggressive putting new exposure on. The trend still remains to fade rallies. Larger vanillas not doing much of anything today. European sovereign headlines remain top of mind and some spreads are wider (i.e. Spain, Portugal, and Greece spreads are wider vs. German bunds), but this doesn’t seem to be having the same type of systemic impact today as they did last week (although financial equities worldwide are all lagging due in part to sovereign debt worries). Calendar is pretty light this week both on the corporate and eco front; the biggest event will prob. be Bernanke’s testimony before the House on exit strategies. People watching to see if we can close north of 1071 on the sp cash.

  65. 65
    zman Says:

    Thanks for that BOP – market has a very quiet, post Super Bowl hangover, feel to it.

  66. 66
    zman Says:

    I’ll have those E&P qucik multiples out for tomorrow along with last thoughts on EOG and snapshot pre earnings preview.

  67. 67
    zman Says:

    Oil up 80 cents now to $72 as the dollar retreats a third of a percent, but remains above 80 on the index.

    NG about flat now as profit taking all morning comes into play… I would not expect a big sell off in NG over at least the next two weeks as 2 winter storms, one from the west and one from the central plains collide to run up to D.C. dumping big snow on them again.

  68. 68
    zman Says:

    Forgot who took VNR late last week but your timing is better than mine.

  69. 69
    zman Says:

    Small post lunch sell off in progress on the DJIA/S&P.

  70. 70
    choices Says:

    another slow news day item FWIW-somewhat dated (early Jan 2010)


  71. 71
    zman Says:

    Thanks choices, surprising little in there on energy.

  72. 72
    Jerome Blank Says:

    S&P sidenote…S&P futures broke out above “value area high” this morning at 1063, rallied 5 pts, then broke back into value at 1:10PM, there is a Market Profile strategy called the 80% rule…in a case like this, when you break back into value and hold below value for a 30 minute time frame, there is an 80% probability of testing “value area low”, which in this case is 1055…by the way, first touch of VAL is many times a good day trade buy spot….

  73. 73
    baylor3217 Says:

    Kog seEms to be doing it’s rinse, wash repeat thing again.

  74. 74
    baylor3217 Says:

    Trying to unload half my bexp option position @ .50 if anyones interested 🙂

  75. 75
    zman Says:

    Thanks JB, good to keep in mind. ROSE in weak gets weaker mode. I may add a little if the market turns back to green. Near term catalyst for them may wait on the quarterly press release although EOG earnings could help all the EFS players. North Dakota Bakkens could catch a ride as well (not ROSE but thinking WLL, CLR, BEXP, NOG)

  76. 76
    Jerome Blank Says:

    RE: #75, ROSE, watching ROSE price action @ $19 support, see post #36 for technical thoughts…

  77. 77
    zman Says:

    Yep, yep, had 36 in mind. That kind of action, separate from the group, is what I call a “weak gets weaker” or a “strong gets stronger” kind of day. It builds on itself for no other reason than it started out differently than the group.

  78. 78
    jiveyjr Says:

    BEXP just put in new high for the day…

  79. 79
    nifkin Says:

    NG weaker on news of some LNG cargoes incoming… hasnt showed up in bentek data yet.

  80. 80
    zman Says:

    Nifkin – I saw LNG outflows at 2.0 Bcfgpd last week, so higher but not a big difference from what we’ve been seeing and down to the big volumes seen last time it got really cold.

  81. 81
    zman Says:

    ROSE printing in the $18s.

  82. 82
    VTZ Says:

    Re Dollar: There is a lot of longterm resistance in between the 80.50 and 81.50 levels so all the dollar bulls might have a harder time cracking it than expected.

  83. 83
    isleworth Says:

    Z- Did you review the Bernstein downgrade report on HK? Wondered what their thesis is?

  84. 84
    zman Says:

    Isle – no, I don’t have copy of it but would be interested in their thoughts there, so many, including myself on the opposite side of that downgrade in terms of the go forward thinking.

  85. 85
    Jerome Blank Says:

    RE: #83 HK…now trading at a low risk spot, but currently below P&F trendline support on a sell signal, so not currently crazy about the technical probability given the marco environment…but a short term bullish move could take the stock back to resistance at $26-$27 to cover, and a buy print at $28 changes the picture completely…

    HK Charts and comments…


  86. 86
    zman Says:

    No trades from me today, market just doesn’t look ready to run or fall off much here either, thinking we start to get more news flow in the space tomorrow and then more over the next two weeks.

  87. 87
    Jerome Blank Says:

    #72 correction…the VAL point is 1051, not 1055…1056 is the first hour low, should at least bounce there, before going lower…

  88. 88
    zman Says:

    re 87 – JB what’s your target for “going lower”?

  89. 89
    Jerome Blank Says:

    First hour low bounce, doing what it should be doing, might try to buy VAL on the /ES today if it holds for 10 minutes…

  90. 90
    Dman Says:

    The only good thing I can say about the market here is that it is dull. But I doubt that one day’s dullness is enough to trigger the “never short a dull market” proverb. POT, FCX just sliced into negative on the hourly MACD, suggesting downside there for tomorrow.

  91. 91
    zman Says:

    Dman – yep, not big volume in our space, not big downs or ups for the most part.

  92. 92
    zman Says:

    Dman – did you see the housekeeping watch today? Lot easier to go find stuff now.

  93. 93
    nifkin Says:

    re #85 and #86- HK downgrade more a knock on the Haynesville, core smaller than people think, econimics poor vs other shales, service cost will only go higher vs 09

  94. 94
    Jerome Blank Says:

    RE: #88, thinking of buying 1051, for a quick trade back to at least a retest of 1st hour low 1056, not the greatest risk/reward although perhaps back to VAH at 1063 if things work out…

  95. 95
    Dman Says:

    #91 – yes & I noticed you mentioned it the other day. A bit scary that I’ll now be accountable for all my past comments 🙂

  96. 96
    zman Says:

    Thanks Nifkin.

    Re core smaller – maybe but I doubt the analyst would know better than the rest of the world.

    Economics poor vs other shales – simply not true unless he’s right about the whole play as the economics are probably second best out their in the shales and maybe third best in the country

    Service go higher this year – well duh.

  97. 97
    Dman Says:

    oops, #95 was responding to #92

  98. 98
    zman Says:

    re 95 … “welcome to the party pal”

  99. 99
    BirdsofpreyRcool Says:

    HeadTrader saying NYC is expected to get 18 inches of snow on wed… they are telling people not to come into work. Could be a reeeeeeeeeeeeally slow week.

  100. 100
    zman Says:

    Looks like banks/financials taking it on the chin today and dragging down the S&P, energy down on the indexes but very mixed on the stocks.

  101. 101
    Dman Says:

    #24 – the article asserts that going to 20% enrichment is the hard part and that going from 20% to 90% is easier (quicker & less centrifuges). I hadn’t heard this before, but I suppose it makes some sense if the volume of material is contracting with each pass thru, i.e. the increase in concentration is achieved by eliminating the non-desired material. That sounds like how a centrifuge would work. I’ll see if I can get any info on this.

    If this checks out, then this announcement is a major raising of stakes and suggests that Iran calculates that they can deter US-Israeli action.

    From what I can gather, the Israeli security establishment is not very worried about Iran: they’ve been dealing secretly with the mullahs from the beginning and know from experience that they are subject to deterrence. For example in 2006 (as I recall from Haaretz articles at the time), they warned Iran that if any Hezbollah missiles hit Tel Aviv, the retaliation would be against Tehran.

    However, whatever the views of the security establishment, the public and politicians are another matter entirely and panic about Iran is at a high level.

  102. 102
    zman Says:

    Bastardi is now calling for snow cover from the Louisiana Gulf Coast all the way up to the north pole (basically) by Thursday.

  103. 103
    Dman Says:

    #102 – not that the stocks seem to care.

  104. 104
    zman Says:

    Dman – I had read that before, that its not a linear enrichment curve, and that that the first 20% is the hardest. Still doesn’t mean they can to 95%.

  105. 105
    BirdsofpreyRcool Says:

    TED is still hanging out around +15.4 bps… pretty much yawning at the equities market and widening of the CDS indices.

    Frankly — if you can believe it — the TED Spread is the lowest it has been in 2 yrs, today.

  106. 106
    zman Says:

    The stocks are mostly watching the broad market.

  107. 107
    zman Says:

    Beerthirty, lousy close, should add fuel to the bear fire.

  108. 108
    Jerome Blank Says:

    KOG…nice price action in KOG on the close…holding support, and then some…

  109. 109
    BirdsofpreyRcool Says:

    Pointing out the TED level today, HeadTrader’s comment — “it’s not a crisis…. it’s just poeple trying to make $$”

  110. 110
    Dman Says:

    Very amused by this headline from the post:

    “Geithner Says U.S. Will ‘Never’ Lose Its Aaa Debt Rating”

    Given the G-man’s track record, I think the funeral service for Aaa can be held already.

    Notice the tricky wording: they will solve the defecit *after* they’ve solved unemployment. Hilarious! I’m sure the worlds creditors will *never* see through that little ruse.

  111. 111
    zman Says:

    re 108 yeah, but only really light volume.

  112. 112
    Jerome Blank Says:

    Re: #111, KOG, with you….but a “feels nice” material buying spike into the close, vs. the vol, the close was decent and in the right direction…can you believe ROSE closes at $19, talk about ambiguity…all in all this really was not that bad a day, BEXP, ATPG. AEZ EXXID, KOG, KWK all green…I’ll take look at the technical marco changes tonight after all the info is in….

  113. 113
    isleworth Says:

    PQ :
    Co announced that it ended 2009 with approximately 179 Bcfe of proved oil and gas reserves. The Company’s year-end reserves were net of approximately 3 Bcfe of proved reserves sold during 2009. Approximately 88% of the proved reserves at December 31, 2009 were natural gas, approximately 77% were located in long-lived basins and approximately 62% of the reserves were proved developed. As a result of the new SEC reserve pricing methodology, which averaged $3.87 per Mcf and $61.18 per barrel; along with the expiration of several high value cash flow hedges, the Company expects to record a non-cash ceiling test writedown of approximately $50 – $55 million during the fourth quarter of 2009.

  114. 114
    zman Says:

    re 113 – if that hits the stock tomorrow, I’m likely to add the common back, maybe a day or two or three from now.

  115. 115
    jat Says:

    TRGL and EVEP doing some overnight offerings, just got calls on them, if anyone cares.

  116. 116
    zman Says:

    Jat – gotta love it when guys like TRGL announce a secondary and forgets to mention how many shares they’ll be offering.

  117. 117
    Jerome Blank Says:

    Good evening…there were no material changes to the bullish percents that we are tracking or the macro technical picture…the bullish percent for financials and consumer staples were the standouts, actually tracking higher 2.27% and 1.92% respectively…energy recorded no change…

  118. 118
    RMD Says:

    ROSE: Quick reaction to ROSE today is that if co. announces “bad” results soon, I’ll suppose insider leakage knows more than I do , and my impression of squeeky-clean mgt was wrong, and I’ll sell and go do something else. In S. NJ where more snow is coming, enough to set NJ records if the forecast is correct.

  119. 119
    sunshine Says:


  120. 120
    nifkin Says:

    MCF Earnings on the tape

  121. 121
    nifkin Says:

    MCF Contango Oil & Gas reports Q2 EPS $1.18 vs year-ago $1.12 ($47.45 +$0.38)
    Company reports revenues of $46.1M vs year-ago $45.5M.

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