Worldwide offshore oil and gas drilling contractor Diamond Offshore Drilling Inc. (NYSE: DO) has formed a massive bottom known as a cup-and-handle, which is a very bullish formation.

Coupled with a gold cross (also bullish), DO recently flashed a buy signal from the Moving Average Convergence/Divergence (MACD) indicator.

If you're looking for the most accurate way to predict the direction a stock or the market is headed, technical analysis is it.

Of course, no chart pattern is accurate all of the time (which is why technical analysis is more of an art than a science), but it's the closest you're going to get to a sure thing in the stock market.

So I'm offering up six technical trades today. Each of these stocks' charts are giving off extremely bullish signals and look ready to run higher.

Drill, baby, drill was the calling card of the Republican Party during the last presidential election.

With high oil prices and rising demand, finding new sources of oil is imperative. Given environmental concerns, offshore drilling is one space that still offers meaningful potential to increase domestic supply.

Diamond Offshore Drilling (NYSE: DO) operates some 45 deep water rigs that are keeping extraordinarily busy with oil prices on the rise.

You have to love OPEC. It's not uncommon for the barons of the giant cartel to voice their interest in seeing oil at such-and-such a price.

Recently, OPEC reiterated its desire to see oil prices at $80 per barrel. This, they claim, is the price needed to spur additional investment in crude projects. Apparently, anything less will result in oil sitting idle in the ground.

"We sense a turn for the better coming in the oil sector," says Peter Way who tracks 'big money' investors for his Block Trader Oil & Gas Report. Here's his look at the "big block" traders.

"When we use the hedging analysis employed in our stock price forecasts, there are significant differences between some adjacent futures expirations. Here's the current picture:

"Front month (November) hedging suggests likely near-term higher prices. But the December contracts are likely to continue the past 3-month price decline – briefly.

"After that we could see crude rise over a few months into the $115-125 area or even higher, providing a bullish backdrop for most energy stocks. We sense a turn for the better coming in this sector.

"Several issues are selling at attractive prices now. Among major integrated producers, the standout prospect among the big oils is Petrochina (NYSE: PTR).

What are the best energy investments for long-term investors? To answer this question, I surveyed 20 of the nation's leading financial newsletter advisors to find their current favorite ideas in the energy sector.

Interestingly, the advisors see the best opportunities in areas well beyond traditional oil firms; indeed, no one included in this report chose a major integrated oil company. Rather, the advisors have shown a preference for various oil services sectors, non-oil energy sources, and developing alternative technologies.

Some focus on areas such as deep-sea operations with Diamond Offshore Drilling Inc. (NYSE: DO), Transocean Inc. (NYSE: RIG) and Oceaneering International (NYSE: OII), while others look toward oil shippers such as Nordic American Tanker Shipping (NYSE: NAT) and refiners such as Valero Energy Corp. (NYSE: VLO).

Others chose companies that make specific products needed by the oil & gas industries such as NATCO Group Inc. (NYSE: NTG), which makes a wide range of oil & gas processing systems; Dresser-Rand Group Inc. (NYSE: DRC), a maker of control systems; Gardner Denver Inc. (NYSE: GDI), which makes compressor and fluid transfer systems; Tenaris (NYSE: TS), a maker of pipes and tublar products and Schlumberger Ltd. (NYSE: SLB), the largest and most diversified of the oil services companies.

Rowan Companies Inc. (NYSE: RDC), a provider of international and domestic offshore contract drilling services, is recently down .33 to $37.42. RDC has been frequently mentioned as unconfirmed buyout candidate over the last 18-months. RDC has a market cap of $4.1 billion with long-term debt of $450 million. RDC has a P.E. of 12. RDC is expected to report EPS on 11/1. RDC call option volume of 4,251 contracts compares to put volume of 62 contracts. RDC October option implied volatility of 38 is above its 26-week average of 33 according to Track Data, suggesting larger risk.

Diamond Offshore Drilling (NYSE:DO) implied volatility Flat as oil trades at $83. DO, a drilling service provider to the energy industry, is recently trading down .04 to $114.01. DO has a market cap of $15.9 billion with long-term debt of $502 million. DO has a P.E. of 18. DO is expected to report EPS in late October. DO has been frequently mentioned as a potential acquirer of drilling service assets. DO October option implied volatility of 32 is near its 26-week average according to Track Data, suggesting non-directional price risk.

Option update provided by Stock Specialist Paul Foster of theflyonthewall.com.

Diamond Offshore Drilling (NYSE: DO) volatility slightly higher as DO at record high. DO, a drilling service provider to the energy industry, closed at $113.04. RIG and GSF, drilling service providers, announced a merger of equals on 7/23. DO August option implied volatility of 36 is above its 26-week average of 33 according to Track Data, suggesting slightly larger price risk.

Ensco International (NYSE: ESV) volatility elevated as ESV at record high. ESV, an offshore contract drilling company, closed at $65.90. RIG and GSF, drilling service providers, announced a merger of equals on 7/23. ESV has a market cap of $9.8 billion with long-term debt of $308 million. ESV had March 2007 quarterly net income of $232 million on total revenue of $514 million. LYON has a $59 price target on ESV. ESV August option implied volatility of 40 is above its 26-week average of 33 according to Track Data, indicating larger price fluctuations.

Atwood Oceanics (NYSE: ATW) August implied volatility elevated as ATW at record high. ATW is engaged in the business of international offshore drilling of exploratory and developmental oil and gas wells and related support management and consulting services. ATW closed at $74.36. ATW will report EPS on August 7th. RIG and GSF, drilling service providers, announced a merger of equals on 7/23. ATW August option implied volatility of 39 is above its 26-week average of 33 according to Track Data, suggesting larger risk.

Rowan (NYSE: RDC) August volatility elevated into EPS. RDC, a provider of international and domestic offshore contract drilling services, will announce EPS on August 2nd. Morgan Keegan says: "We are lowering our estimates on RDC as we build in lower day rate assumptions and a delayed recovery for US Gulf commodity jackups." RIG and GSF, drilling service providers, announced a merger of equals on 7/23. RDC August option implied volatility of 46 is above its 26-week average of 32 according to Track Data, suggesting larger risk.

Daily Update is provided by Stock Specialist Paul Foster of theflyonthewall.com.

Analysis provided by Paul Foster of Theflyonthewall.com:

U.S. stocks sold off on a disappointing November manufacturing survey and further weakness in the dollar. The Dow down 0.82%, NASDAQ 100 down 1.32%, S&P 500 down 0.76%, and the 10 year bond rates decreased to 4.425%. The CBOE VIX was up 1.00 to 11.89.

Novellus Systems, Inc. (NASDAQ:NVLS) implied volatility near elevated as NVLS trades up to 30-month highs. NVLS develops, manufactures, sells and supports equipment used in the fabrication of integrated circuits. CIBC say's "NVLS up $2 intraday as speculation re-surfaces on Tokyo Electron LTD (TEL) buyout. This AM, our high-level sources at both TEL and Hermes Epitek (TEL's distributor in Taiwan) flatly denied talks are in progress." NVLS call option volume of 21,883 contracts compares to put volume of 43.442 contracts. NVLS December option implied volatility of 50 is above its 26-week average of 36 according to Track Data, suggesting larger price fluctuations.

Diamond Offshore Drilling, Inc. (NYSE:DO) implied volatility increased on heavy volume as DO rallied. DO, a drilling service provider to the energy industry, was recently up $2.78 to $80.40. DO has a market cap of $10.3 billion with long term debt of $965 million. MOKE issued a report suggesting DO, NE & ESV are possible acquisition candidates of SeaDrill. DO call option volume of 9,844 contracts compares to put volume of 3,271 contracts DO over all option implied volatility of 38 above a level of 31 this morning and near its 26-week average according to Track Data, indicating non-directional fluctuations.

Option volume leaders today were The Home Depot, Inc. (NYSE:HD), Apple Computer, Inc. (NASDAQ:AAPL), Microsoft Corporation (NASDAQ:MSFT), Ford Motor Company (NYSE:F), and ExxonMobil Corporation (NYSE:XOM).