Bookkeeping: Two New Positions

I am adding two positions here, one an old holding I am adding back to the portfolio and another a brand new name.

1. After being bullish all fall on the deep sea oil drillers, and promptly seeing them do nothing I exited my positions about 8 weeks ago. Of course, not more than a few weeks later did this group finally begin to put a move on (Darwin and all). I did mention in mid December how great the charts were looking of the 3 names in this sector [Three Deep Sea Drillers - 3 Great Charts]. I did add a smaller position back in Atwood Oceanics (ATW) shortly after [Restarted Atwood Oceanics], when it pulled back, but certainly not enough considering how huge of a move it made right after that buy. I am maybe making the same error today by being greedy and holding out for a lower price, but I am going to restart a position in Diamond Offshore Drilling (DO) on today's pullback. After peaking around $149 last week, the stock has pulled back to its 20 day moving average today - $134. (10% correction) So I am adding here in the $136s, with hopes to see mid $120s to add more. This would be near the 50 day moving average. As we enter a world of stagflation (I was a kid last time around so should be 'exciting' to see it in this time around), I expect oil to continue to confound 'experts' who don't realize this brand of inflation has nothing to do with the US economy but a continued world of shortages as too many people try to enter the middle class at once across the globe. Much like the oil service names I have been hoping to hop in, deep sea oil service is going to be needed if crude is $60, $80, $100, or $120. Why these stocks are not getting better valuations is beyond me - I think people still think this is a cyclical story, and not secular. I started DO as a 1.5% position. Atwood Oceanics has not budged - I was hoping to add to that name as well. Most traders would actually add ATW since it has the better relative strength vs DO, but I like to buy things near support levels. Just a style difference - I could certainly have the wrong horse, but I now own both once again.
2. For the first time I am adding a steel name to the fund. I am very conflicted over the steel story. On one hand the world growth must slow as Western economies enter slowdown (cough cough recession). On the other hand China seems determined to build build build no matter what.... and India is still building... as is the Middle East. More importantly China increased tariffs on steel exports, so this might be a short term benefit as they slow down their flooding of world markets with steel. While I am not a secular bull on steel, I keep a small part of the portfolio for cyclical companies (short term moves) like the refiners, or just some shorter term trades, so I am going to try one here with US Steel (X). I debated this name versus Arcelor Mittal (MT) which is turning into the worldwide powerhouse in steel, and Cleveland Cliffs (CLF) which is a US based iron ore pellet company (iron going into steel). I like all 3, but chose US Steel for technical reasons. I actually have debated adding Cleveland Cliffs for months as a long term holding since I think it could be bought out at some point and I have very little iron exposure... still debating. Back to US Steel (X) - easy story from a technical perspective... before the Chinese tariff news steel stocks seemed to be weakening on fears of slowdown in world economies, after this news is released stock rallies from low $100s to $122. Now we are back to where we were before the tariff news came out. 50 day moving average is $106 so this is where I enter. Now, since this is more of a trade instead of a long term position I am taking a different tact than normal. Usually I build up a position over time but I am doing a quick 2.6% exposure (300 shares) - if X strengthens I will add to this position and then if I can get a 10% or so move I will flip out. If this 50 day moving average fails, then I will set a stop loss somewhere near $100, take the loss and move on. Let me stress again, this is not a typical position but I try to keep a small portion of the fund for opportunities like this. I have avoided this whole area (metals, mining, steel, dry bulk) the past few months due to the inevitable time when people realize emerging markets can't decouple from their export markets, and it has worked out well thus far. I plan to continue to play the growth in those markets with agriculture and infrastructure (especially energy build out)... I think the other areas are more prone to investor sentiment swinging to fears of commodity slowdown when world economies slow, so those areas are best left to nimble trading in and out - whereas we will have a lot more stability in the ag and infrastructure names in my opinion.

Long US Steel, Diamond Offshore, Atwood Oceanics in fund; no personal positions