Random (market) Thoughts
By Todd Harrison Jan 12, 2004 8:49 am
- Today's market action will serve as posturing before the earnings' avalanche kicks in. Highlighted companies include Intel (INTC:NASD) and Bank of America (BAC:NYSE) on Wednesday. For a more detailed list, check out Fokker's Chronicles.
- Elmer opined last week that his clean-up crew was standing by and at the ready. What he failed to mention--and what was intuitively inferred--is that there's a minxy mess in the first place. Taking medicine is never easy--but pretending the patient isn't sick (or injecting her with simulative drugs) only prolongs the inevitable.
- How long will jobs (or lack thereof) get the benefit of the "lagging indicator" rationalization?
- How low does the dollar have to fall before the Fed is forced to raise rates? When that happens, will it be postured around the "robust" economic rebound?
- The most bullish element of the current environment is Brian's analysis of the corporate bond market and its relatively tight spreads. His scenario fits with the concept of Elmer trying to buy time for the recovery to self-fulfill.
- How high does crude have to trade before it's considered "shocking?" The commodity has broken out and seems intent on testing the March 2003 highs (before it crashed on the Iraq invasion).
- A "rolling correction" would be a constructive way for the market to work through its overbought condition. (see the home builders).
- The semis, despite Friday's marginal loss, are still flirting with that triple top breakout we discussed. The piggies are doing the same at multiyear highs.
- The hallmark of this recent rally has been the "one and done" nature of the pullbacks. The bulls will look to break Boo's will with more of the same.
- S&P 1150 remains decent resistance (50% retracement of the entire bear move). S&P 1170, so you know, represents multiple tops from 2001 and 2002. The index is currently sitting right on the December 10 trendline.
- Make certain your risk profile and time horizon jibe.
- If you don't have an edge into a particular earning's report, there's no mandate to have a position at all.
- Europe is starting the morning dancing marginally in the red.
- If you ordered holiday stuff (or anything else) from the critters and have had delivery issues, please email Fokker@Minyanville.com
- The "surge" into the beginning of January makes sense (new money). Now it gets entirely more interesting as we look forward and digest earnings. Traders (and portfolio managers) will be listening for guidance and the market (as a leading indicator) will "look out" to the future.
- Good luck today.
No positions in stocks mentioned.
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