I should warn you that I am just playing devil's advocate here. So if you do not want to hear another negative viewpoint then do not read on. And no I am not downramping so as to acquire cheap entry, as I am not currently interested in buying SSN. However, as I was a holder who sold at 3.8 I am still following this stock.
Now, since Gene announced it had fracced the first 5 stages, which is when all this excitement really began we have heard from this forum a lot about what the possible flowrate would be.
Immediatly after that announcement it was supposed to be somewhere between 2000-3000bopd as we had only fracced a third and everyone thought that the flowrate would increase with additional fracs. Because of this excitement the SP ran from 2.9 to 4.1.
However once we started to hear the real story, that is that that after a 40% cut the rate had stayed the same, all those that were expecting higher rates sold and the SP fell back to 3.6. Then after another announcment showing a total 45% cut the flow rate decreased. So once again, those hoping for a flow rate increase at 70% cut sold, and the SP again fell back to 3.4c.
Now, I find it interesting that after so much hype about high flow rates, this forum has conceded that the flow rate will actually decrease as the cut increases. Something that could have found out easily by way of basic some due diligence.
The funny thing is that some on here are still talking about the SP increasing after another flow rate decrease?! Have you ever considered that the SP is overvalued?
The SP traded in a range between 2.4 and 3.2 for a very long time. This is when Gene had significant shows and was due to be fraccced, and Ripsaw about to be spudded. It then was valued at 2.6c after the ripsaw duster and 3.2c after the first Gene flowrate announcement with all the excitement of two-thirds of the frac to come.
So it seems to me given that all the information is currently on the table, with no real good news expected in the short term, that there is not much left to drive an SP increase. But rather the possibilty that the SP will fall back to support of 3.2c and if it breaks this could fall back into its old trading range.
Technically the chart is a shocker. Just look at the chart posted by Enrichj. The stochastic showing overbought and crossing back down, while the MACD is also about to cross over back down. That is as bad as it gets for momentum.
The only saving grace is the workover of the State GC well in early May which may create some interest.
Now, I am sorry to post such a negative message, but given the tone of this forum over the last week I thought it time to give those new to this game a bit of a reality check so they do not lose any more money.
Cheers
SSN Price at posting:
3.4¢ Sentiment: ST Sell Disclosure: Not Held
