I analyze macroeconomic issues from a fundamental perspective, and I analyze market behavior from a technical perspective. Original macroeconomic analysis can be found here and both macro analysis and commentary can be found on my Caps blog. If you like or appreciate my analysis, please add yourself to my Following List

Wednesday, June 2, 2010

ATPG, part IV

Here is my 4th look at ATPG in the last several months. I have written about ATPG several times:

- Analysis Update: ATPG and AMX
- Analysis Update: ATPG and AMX (Feb 5)
- Natty: It's a Gas!, a Review of ATPG, and a look at SWN

I had been calling for a correction in ATPG down to the support level at ~$8.00. And I had a small short position in ATPG that I had recently covered partially yesterday and then again this morning. And for disclosure's sake, I just bought a speculative long position.

Here is the relevant chart from my last post that was showing the support levels: http://4.bp.blogspot.com/.../binve-1.png. You can see my projection got extremely accelerated. I was bearish on ATPG due to it's extremely high debt levels, but it is being sold off aggressively along with nearly all producers due to BP's negligent actions.

But let me be clear, I am not long term bearish on ATPG. In fact I am long term very bullish. I think the management has made some smart long term strategic purchases. But their debt load is high and their stock ran up too far *way too fast* since this last correction. And now it has corrected back down way too fast. It is bouncing off very strong support.

Is this "the bottom" for ATGP? I have no idea. I just know that I like the risk/reward here for a bounce that should last awhile. And if it gets down to $6.00, I will like it even more.

Here is my new chart:

Disclosure: I have a small speculative long position in ATPG
blog comments powered by Disqus