I didn't know Hoofy's last name was Jeremy!
Where are you going now my love?
Where will you be tomorrow?
Will you bring me happiness?
Will you bring me sorrow?
The afternoon hither continues to slither as the critters ready for the earnings come hither. The overnight catalysts are udderly ridiculous--over 100 companies will report before tomorrow's breakfast bell--and my speaker phone is starting to develop multiple personalities. Banks? Telecom? Defense? Semis? Homies? You got it Mister, it's all that and more. I hope ya'll enjoyed the day off 'cause we'll be crammin' and slammin' all the way to Freaky Friday.
While the Minx is doing the Sammy salsa, the action under the hood is once again notable. The energy patch is on fire as the drillers (OSX) tack on 4% and the integrated oils are up a deuce. The quiet riot that is crude oil (up 3%) is still creepin' while ya sleeping and while it's not getting much play in the media, it's clearly emerged on the trading radar. Chicken Little material? Possibly, but you always want to see the various metrics and base your decision from there.
Meanwhile, sticking with the macro inputs, the dollar squalor and bold gold are asserting their will with the former index down 1.5% and the latter commodity up $6. Par for the course, I suppose, and while traders try to fish out the trends from the countertrends, it's worth noting the outsized moves. When volatility picks up--which it has for other asset classes and will for equities--it sometimes pays to play a bit smaller. This way, if prices move adversely, you have room to maneuver.
Breadth is skewed to the positive and while the averages are uneventful, Hoofy continues to file his nails. He's nonchalantly eyeballing General Electric (GE:NYSE) which, despite its daily digestion, broke multiple tops on Friday. That, along with the chart of the biotechs, banks, brokers and semis, is offering no cause for paws and little reason for doubt. That's how it looks through the bull's eye, at least, as our resident bovine opines that everything's fine.
Boo, who makes Mr. Bigglesworth look furry, can only watch and point to the same 'ol, same 'ol. "Everyone, and I mean everyone, thinks the next leg is higher." he mumbles, "The bulls are yelling 'break out,' the bears are pointing to S&P 1150-1160 and classic lore dictates that this will end with a bang rather than a whimper (denial/migration/PANIC!). They may be right but they'd better be--if this doesn't turn out as expected, the bottleneck will be viscious" Duly noted Boo...and I like the knee pads. Very apropos.
Finally, and file this under the "good things happen to good people" category, I want to share a quick little story. David Garcia and I met in 2000 when I was honored by United Cerebral Palsy and he attended the event as my guest. David (who is a quadriplegic) was going through a rough time and while he remained upbeat and full of spirit, I could tell he was feelin' it. Well, I just got an email from my Alabama pal and I'm happy to say that he's very much in love and (gasp!) actually eyeballin' a ring! Music to my ears, brother, and I've gotta say--she's a lucky duck. Bill Meehan, who spent the event by David's side, is surely smiling from above. Go Bama. Roll Tide!
As always, I hope this finds you well.
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 firstname.lastname@example.org.
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