Welcome to the frozen tundra, my friends, where traders are completely spun around and looking for direction. Trading on your heels is never a good idea but when you have this many balls in the air simultaneously, you can bet that the crowd is more reactive than proactive. Remember commandment #1 from this morning—respect the price action but never defer to it. If you’re buying ‘cause they’re up and selling when they’re done, go grab some lunch and take a chill. That’s a recipe for whippage.

There’s no way to sugarcoat that the Iraqi news is a net positive as there was certainly a contingent that pressed the short side on the prospect of a stubborn Saddam. Still, once those shorts cover we’re left with the same credibility dilemma and Dubya seems to feel we’ve seen this movie before. If nothing else, it prolongs the process and pushes the storm cloud further out on the horizon…which is either good or bad depending on your perspective.

As it stands, the tone of the tape has improved dramatically and an already “accumulative” tech sector continues to lead the market. The macros that bought in front of Elmer, sold on Elmer and shorted after Elmer have now turned to cover. I’ll tell ya, in my next life I want to come back as Duke & Duke! The financials, meanwhile, have turned green and that’s an impressive turnaround after the 2 ½ % haircut they were taking an hour ago. I still think the tape will have a hard time pushing through S&P 900 but, hey…I’ve been wrong before. As it stands, I’ve got one paltry leg in my bear costume (25% conviction) and I’m in watch mode. I may slip that other leg back in near our resistance level and use a tight stop.

More importantly, my lunch just got here and while I’m going to make every effort not to be a glutton (again), I’m still pretty hungry. I’m fairy certain that there’s a direct correlation between stress and hunger and, as such, I’ve directed Martin to scour the streets and accumulate as many Brent & Sam’s chocolate chip cookies as humanly possible. I don’t consider myself an expert on many things but chocolate I KNOW—and those are some pretty good cookies! I may have to roll up my jeans to a size 38 soon!

Hope you’re all managing this volatility.