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Jazz Club


You might as well call me Sammy Dangerfield!


I can tell your future
Look what's in your hand
But I can't stop for nothing
I'm just playing in the band

(Grateful Dead)

Good morning and welcome to the mood swing Minx. When the dust settled after last week's ping pong, the bulls held a decided advantage over Boo's bandits. As a matter of fact, Hoofy was so giddy after Thursday's (gasp!) green seas, he shrugged and strutted his way through dismal payroll numbers to end the week on a firm note. Will his optimism prove (yet again) to be an opportunity to "sell hope" or can the bovine turn the corner and chase the bears into hibernation? We won't have to wait long to find out, cookie--earnings week is upon us and the games are about to begin!

While both camps have been huffing and puffing as they state their case, a quick peek at a two month chart tells the true tale of the tape. Despite the Thanksgiving cheer and the Santa Claus jeer, the Minx has meandered in a relatively defined range for quite some time. Granted, there were bountiful opportunities if you were white hot and trading with mojo but, taking a step back, Sammy's been the only critter with cause to rattle and hum. Ssssupp Sammy!

Currently, the widespread sense in trading circles is that the Minx is poised to explode higher. If you recall, there were similar pangs in late November when it looked (and felt) like the short side was "reckless." The false breakout that ensued not only caught the momo guys with their shorts down (pun intended), it also established the ominous "head" that's been the itch of the dandruff crowd. While this time could be different and the tape feels like it wants to go higher, the obvious question must be asked: are there too many bulls and too much hope?

Market players are anxious to hear what corporate America has to say and, even though the recovery has been "two quarters out" for a few years, the outlooks will dictate our short-term direction. Intel will play grand marshal for the forthcoming earning's parade when they kick-off the season on Tuesday. There was a swirl of chatter making the rounds on Friday regarding a bullish report (upping capex) and that's raised the bar (expectations) somewhat. Other notable hotshots painting the tape this week include Yahoo!, Microsoft, Sun Micro (are they still a hotshot?), the Generals (GM and GE) and Mr. Beeks.

As we've discussed, my goal this year is to identify compelling risk/reward opportunities and bleed less from the unnecessary paper cuts. While there are enough ducks lining up for me to currently have both legs in my metaphorical bear costume (50% conviction on the short side), I'm quite conscious of two things. One, I'm always early and two, there are a host of unknowns in our midst. Timing is everything, my friends, and my nagging suspicion is that the banks may have to break out (BKX 800) before Boo can wrap his arms around the honey jar.

One (baby) step at a time as we find our way and forge our path. It's going to be an action packed week and there's a lot of chips on the table. Maintain your composure, trade within your means and, if you're unsure, play smaller (or not at all) until you can identify a discernable edge. At the end of the year, we'll be measured by wins minus losses--cutting down on the latter will only increase the former.

Good luck today.

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No positions in stocks mentioned.

Todd Harrison is the founder and Chief Executive Officer of Minyanville. Prior to his current role, Mr. Harrison was President and head trader at a $400 million dollar New York-based hedge fund. Todd welcomes your comments and/or feedback at

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