RIG - rats jumping back onboard

Transocean (RIG) closed strongly higher for the fourth consecutive day, closing 5% higher @ $51.73. It has been a starkly strong week for RIG, having climbed over 15% since New Years Eve. The near term looks distinctly positive.


RIG, daily

Summary

RIG is seeing a very clear breakout from a trading range that spans five months. With two daily closes >49, this is pretty good.

The company has been having serious issues, not least related to the Deep Water Horizon disaster, but it seems that issue is now closed, with an agreed payment, and the company can finally move forwards.

see key stats @ yahoo! finance


Upside targets?

First upside target is the March 2012 high in the 57s. If RIG can break back into the 60s, - and if the main indexes broadly hold together into the summer, then a full retrace to the March 2011 high of $85 seems reasonable.

After all, almost anything related to the Oil sector is going to do well in the longer term.

It is certainly one to watch in the coming weeks.

AAPL - failing at the 50 day MA

Apple (AAPL) is having difficulty breaking above the declining 50 day MA. AAPL closed the day -1.2% @ $542. Today's red candle confirms the black (fail) candle from Wednesday. First downside target is around $530/25


AAPL, daily

Summary

Many have recognised the 50 day MA as an important level for AAPL to close above. Despite the market soaring almost 5% in just 3 trading days, AAPL is still stuck in the 540s.

Today's close is certainly  nothing dramatic, but it does confirm yesterdays little sign of weakness (as black candles often are).

*If the indexes retrace back to sp'1440/35, then AAPL looks set to hit 530 or so.

Considering the weekly/monthly charts...I'd guess we battle back higher from there.

TVIX, UVXY - nuked..again

With the indexes seeing what is arguably a hyper-ramp, the VIX got smashed another 18% lower into the 14s. Not surprisingly, both the 2x bullish VIX instruments - TVIX and UVXY suffered a second devastating daily close, falling around 21 and 23% respectively.


TVIX, daily

UVXY, daily

Summary

The leveraged instruments..when they go badly, are unquestionably the worse horror show of all.

We've now seen the 2x bullish VIX instruments lose about 45% of their value in just two trading days.

Not much can be said, other than a floor will be reached...'at some level'.

The real problem though is even if the VIX went back to the level it was at the Friday close, due to the statistical decay, TVIX/UVXY would still be down around 10/15% !
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As for the VIX itself...

VIX, weekly

 
This is one of the most powerful down candles we've seen in a very long time, perhaps since market floored in October 2011.

Those who believe this two day index rally is not going to last, should be seeking a VIX levelling out in the 13s..sometime in the middle of next week.