Patience with Diamond Offshore Drilling

Published on Wednesday, 01 February 2012 05:44 Written by Christian Paolinetti

New York, February 1st (TradersHuddle.com) - Shares of Diamond Offshore Drilling, Inc. (NYSE:DO) closed the trading session at $62.30 near its 200 day moving average currently set at $64.26. Diamond's price action is below this important level, which makes the stock difficult to buy, as there will certainly be resistance as it approaches its 200 day moving average.

Diamond Offshore Drilling, Inc. (NYSE:DO) drills offshore oil and gas wells on a contract basis. The Company is a world-wide deep water driller that serves markets that include the deep water, harsh environment, conventional semisubmersible and jack-up markets.

Latest price action range, defined by a peaks and troughs algorithm places calculated support at $52.98 and calculated resistance at $64.07. These levels are being closely watched by traders, as they provide great reference points for the latest price dynamics in Diamond Offshore Drilling shares.

Traders should evaluate their trade if they want to establish a position on Diamond Offshore Drilling given the resistance could materialize as the stock approaches the 200 day moving average. A trade might materialize as the stock manages to break this important level, as it could be used as support going forward, however until the break materializes, traders need to exercise patience. Other levels that traders will be evaluating are the ones defined by the peak and troughs algorithm that provides great price action reference points.