Makattak, Good question u raised. To measure risk in any sector look at the top dogs like AZZ to see where they are headed. Here the exploration fundamentals are excellent and upside looks substantial. Yet the chart pattern has gone vey flat. BCC is more speculative, smaller play, the technicals have also gone flat. VIL is the most speculative and is in a serious sell-off mode.
U.S. natural gas prices are in an almost daily free fall and look to go lower. New drilling technology and fraccing has exploded the amount of gas resources in the U.S. which is a reaction to high oil prices. Assume that gas prices will stay weak thru the end of spring. The whole resource market is under pressure due to a very strong U.S. dollar. The Aussie dollar looks very suspect, the 100 dma has now rolled over and looks likely to head lower. This factor alone pulls a lot of foreign "trading money" out of the market. U can see this in the trading patterns of the overall spec market where volumes have dried up.
In this type of market trading VIL becomes extremely risky to your finances. I wish all of the longs good luck and hope that VIL pulls out some good production numbers from its drilling program and runs against all of the other headwinds hitting this sector.
VIL Price at posting:
3.9¢ Sentiment: None Disclosure: Not Held
