OKLAHOMA CITY, March 21, 2016 /PRNewswire/ -- SandRidge Energy, Inc. (the "Company") (OTC PINK: SDOC) will release its 2015 fourth quarter and full-year financial and operational results after the close of trading on the New York Stock Exchange on Tuesday, March 29, 2016.
Let's all keep something in mind here.
Whatever "negative rhetoric" to be extrapolated from LAST QUARTER'S Financials, is already baked into the present PPS. Short of nervous nellie/newbie types selling on the "GOING CONCERN" statement that SandRidge management already indicated would be in the Financial statement, I don't anticipate anything in the release's verbiage that will cause further decline.
SandRidge was under the microscope for months concerning whether or not they would default on their interest payment to creditors. They squashed/dispelled that notion when they paid the creditors within the grace period allotted them.
SandRidge Energy is flush with cash and have been utilizing/conserving their cash position the best way they can. I believe their banker/lender ($500,000,000) has done their due diligence enough to afford them to draw down on their credit line. I do not believe they would have allowed them this privilege if there were any bankruptcy concerns within the next 3-6 months.
SandRidge Energy common stock fell from the .20's down to .027/share due to the fact they were DELISTED from the NYSE to the OTC Pink markets.
Months prior to being delisted, the shares were trading in the .30 - .40 range. One must ask themselves the question: "What large institutions/hedge funds are allowed to hold stocks under $5 or $1/share? Don't most fund charters (the rules) prohibit them from holding securities at such low prices?"
The answer is a resounding YES, but some institutions held anyway.
On 1-7-16, the day SDOC got delisted it traded 161,559,700 shares with a range of .027 - .13/share
The following session, it traded 135,324,600 shares with a range of .03 - .08/share
Again, this massive drop was due to the MASS EXODUS out of the stock due to forced selling by institutions. Volume that high is indicative of fund outflows meeting fund inflows.
OLD money out.
NEW money in.
That's what makes markets.
The panic, for all intents and purposes, is OVER
Keep in mind that even prior to the shares being DELISTED, the share price was down trending BELOW all of it's ma's. It had a 3 day pop over it's 50 period MA line in early November. Once it began trending BELOW the 50 period SMA and the 20,13 and 8 period EMA, it was downhill.
Please see chart then continue reading beneath it:
Since January, shares of SDOC initially traded on a downward trajectory from .10/share and into February traded in a sideways channel indicative of consolidation/equilibrium.
A beautiful "U Bottom" base was formed and SDOC has broken the down trend by crossing up through not only the 8, 13 and 20 period EMA lines, but also the most important 50 period MA in blue. That type of cross is very BULLISH, and you will note the high volume bars that developed the day that cross occurred.
Since early March, the PPS has maintained ABOVE the 50 period MA and above the 3 most widely charted EMA lines.
We've got a well established and up trending MACD, and it is my opinion that if nothing "shocking" comes out of the LAST QUARTER financials, we will have a powerful upside move that breaks clear thru the .15/share resistance.
What was once resistance (.15) now becomes new support, and then I anticipate the "chaser" crowd to enter causing momentum up and through the .20 - .22/share area. There may be some congestion at this level as there "may" still be those stuck in from PRE-DELISTING price points, and they may want to exit FLAT. Those poor people had to suffer from .25 down to .027 so they may just count their blessings and sell flat. Obviously, they should have averaged down, but some folks are just "deer in the headlights" type of investors and do nothing.
We clear the congestion at .15 and .22 and there's no telling how high this stock can run.
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