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Cliff Notes


Gold is down $12. Maybe I'll finally get that ring I've been waiting for!


The harder they come
The harder they fall
One and all

(Jimmy Cliff)

The morning fun is on the run and the minxy games have officially begun. We sensed that they'd try and rally--and they did--but the mood soured quickly. As the cannons boom in the background, I can't help but think of the AOL/Time Warner merger (TWX:NYSE) . The landscape is surely different but, oddly enough, sentiment is much the same. Is this bank deal validation or culmination? Ultimately, I think the latter (particularly with Elmer's hubris) but that doesn't mean it starts right here, right now.

The breadth has started to stink as there are now two losers for every winner. The BKX remains firmly in the green but please note that Bank One (ONE:NYSE) has a 5.3% weighting. In other words, the big dogs (Citigroup (C:NYSE) and Bank of America (BAC:NYSE)) are lower but the outsized move (caused by the takeover) is skewing the index. The brokers, for their part, are higher on the perception of continued investment banking business (and good looking charts).

The semicaps sure seem crowded as they dance on either side of unchanged. That's surprising in the face of a less than thrilling capex number ($3.6-$4B vs. whispers as high as $4.4B) and has raised an eyebrow in the city of critters. Yahoo! (YHOO:NASD) is down a deuce and that's offsetting the sentiment buoy. Speaking of the collective wisdom, the volatility measures have barely budged (indicating a lack of fear and continued complacency).

S&P 1123 and NDX 1515 are the first areas of support and the bulls are trying to toe that line. It's wild and wooly out there, Minyans, so be prudent with your risk and disciplined in your approach. If you don't know, don't guess and regardless of what happens, don't look back. It doesn't matter how many trades you make, it only matters how many trades work out.

As always, I hope this finds you well.

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