Diamond Offshore Drilling Is Approaching Important Moving Averages

Published on Wednesday, 20 June 2012 05:56 Written by TradersHuddle Wire

New York, June 20th (TradersHuddle.com) - Diamond Offshore Drilling, Inc. (NYSE:DO) closed the the trading session at $60.61, near its 50 day and 200 day moving averages currently set at $62.89 and $62.42 respectively. Diamond's price action places the stock below these important levels, which makes it difficult to be bought, as it will certainly face resistance as it approaches these important moving averages.

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.

The latest price action range, defined by a peaks and troughs algorithm, placed calculated support at $56.27 and resistance at $61.24. Traders should monitor these levels, as they provide insight into the latest price dynamics in Diamond Offshore Drilling.

If traders want to establish a position on Diamond Offshore Drilling, given the heavy resistance expected near the 50 and 200 day moving averages, a trade might be evident as the stock manages to break these moving averages. However, until the break materializes buying the stock is nothing different than flipping a coin.