This column was originally published on RealMoney on Feb. 17 at 12:41 p.m. EST. It's being republished as a bonus for TheStreet.com readers.

Oil drillers have been a hot industry within the energy sector. But as crude-oil prices have hit the skids recently, so have these former highflying -- now overbought -- stocks. However, positive developments in crude's technicals should encourage investors to buy the drillers on this weakness. I believe the seven stocks I've chosen to examine here hit bottom on or about Feb. 15.

All the companies I profile in this column are popular reader requests and have market caps of more than $900 million. They all also now rate either a hold or buy with ValuEngine. Some are slightly overvalued, but most are currently undervalued, thanks to the recent selling.

All of the weekly chart profiles for these stocks have overbought or declining momentum, and would have negative weekly chart profiles, given weekly closes below their respective five-week modified moving averages.

Shares even began to recover Thursday after

Baker Hughes

(BHI)

reported better-than-expected earnings before the open.

More important, I show a floor for crude oil at or above my annual support at $51.87, which is well above the 2004 close of $43.45. This higher base price indicates that the oil drillers should be bought on weakness to their pivot and value levels.

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Let's look at the underlying price action. On the Nymex, crude oil broke below its 200-day simple moving average of $60.39 Feb. 14, which now provides resistance. Crude oil peaked at $69.20 on Jan. 23 between my quarterly resistances at $68.05 and $71.10, and the oil drillers peaked shortly thereafter.

Crude oil broke below my semiannual pivot at $64.58 Feb. 7, providing a warning for downside risk. The weekly chart profile shifted to negative at the close on Feb. 11 below the five-week MMA at $63.58, and some of the oil drillers are poised to end this week with negative weekly chart profiles. Be aware that a weekly close below the five-month MMA at $60.58 would shift the monthly chart profile to negative.

The Feb. 15 low in Baker Hughes at $65.02 held my quarterly pivot at $65.05, but upside for the stock should be limited to my monthly risky level at $72.07. The weekly chart profile shows overbought momentum, and a close this week below the five-week MMA at $68.54 would shift the profile to negative. That would indicate risk to my lower quarterly pivot at $61.25. If crude oil continues lower, there is risk in Baker Hughes to my semiannual value levels at $48.92 and $46.49, where investors should add to positions.

Diamond Offshore

(DO) - Get Report

also made a low on Feb. 15, at $73.33. This was a test of my quarterly pivot at $73.87. Upside should be limited to my monthly pivot at $78.45. The weekly chart profile shows overbought momentum. Ending the week below the five-week MMA at $76.38 will shift the stock's chart profile to negative and indicate risk to my quarterly value level at $64.40, an attractive price for buys.

GlobalSantaFe

(GSF)

gave us a low of $51.30 for Valentine's Day, Feb. 14, which was also a test of my annual pivot at $51.34. I expect upside from this point to be limited to my monthly risky level at $58.41. The weekly chart profile shows overbought momentum, but watch for a close this week below the five-week MMA at $54.64. Such a close would shift the chart profile to negative and indicate risk down to a point where investors will want to add to positions: my quarterly value level at $45.93.

Halliburton

(HAL) - Get Report

is holding up better than the other drillers; its Feb. 15 low of $67.70 did not reach my quarterly pivot at $66.69. The good news for investors looking to buy: The weekly chart profile shows declining momentum, and a close this week below the five-week MMA at $71.40 will shift the profile to negative, indicating risk to my quarterly and annual value levels at $60.44 and $59.10 -- where those buyers will want to get active.

Nabors

(NBR) - Get Report

also put in a low on Feb. 15 at $67.84. This was a test of my semiannual pivot at $67.94, but the upside should be limited to my other quarterly pivot at $73.50. The weekly chart profile shows declining momentum, and a close this week below the five-week MMA at $76.24 shifts the profile to negative. That indicates risk to my annual value levels at $63.71 and $61.14, where investors should add to positions.

Noble

(NE) - Get Report

held my quarterly pivot at $69.02 with its Feb. 15 low of $69.01, but I expect upside will be limited to my other quarterly pivot, $74.94, especially because the weekly chart profile shows declining momentum. A close this week below the five-week MMA at $75.68 shifts the profile to negative, indicating risk to my annual value levels at $56.79 and $54.91, where investors should add to positions.

Transocean's

(RIG) - Get Report

Feb. 15 low at $70.05 was above my quarterly pivot at $67.88, but a rebound should be limited to my other quarterly pivot at $74.01. The weekly chart profile shows overbought momentum. A close this week below the five-week MMA at $75.30 would shift the profile to negative, indicating risk to my semiannual and annual value levels at $47.30 and $45.98, where investors will want to add to positions.

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Richard Suttmeier is president of Global Market Consultants, Ltd., chief market strategist for Joseph Stevens & Co., a full service brokerage firm located in Lower Manhattan, and the author of

TheStreet.com Technology Report

newsletter. At the time of publication, he had no positions in any of the securities mentioned in this column, but holdings can change at any time. Early in his career, Suttmeier became the first U.S. Treasury bond trader at Bache. He later began the government bond division at L. F. Rothschild. Suttmeier went on to form Global Market Consultants as an independent third-party research provider, producing reports covering the technicals of the U.S. capital markets. He also has been U.S. Treasury strategist for Smith Barney and chief financial strategist for William R. Hough. Suttmeier holds a bachelor's degree from the Georgia Institute of Technology and a master's degree from Polytechnic University. Under no circumstances does the information in this commentary represent a recommendation to buy or sell stocks. While he cannot provide investment advice or recommendations, he invites you to send your feedback --

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