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Dirty Birdie!


Hey Toddo--cute thesis!


"I know what you're thinking. Did he fire six shots or only five? Well, to tell you the truth, in all this excitement, I've kinda lost track myself. But being as this is a .44 Magnum, the most powerful handgun in the world, and would blow your head clean off, you've got to ask yourself one question: Do I feel lucky? Well, do ya punk?"

--Inspector 'Dirty' Harry Callahan SFPD Homicide

Well, I suppose it was only a matter of time before my astute sell-side coverage started banging the bullish drum. With the notable exception of Big Anthony at Lehman (who's a fellow, gulp, Raider fan), most everybody I speak with is taking a shot on the buy side. I see what they're looking at--we're oversold, the stochastics are a witches bit away from buy signals across the board and the semi's hang tough. It's obvious...isn't it?

I've learned a long time ago that if something seems too easy, it likely is. That's not to say we can't rally--I said this morning that a pop towards S&P 870 wouldn't shock me and I still feel that way--you've just got to decide if your quack count is sufficient. In other words, if you watch 10 variables in the market, how many of those ducks are currently aligned? If they pass the smell test, go for it cookie.

Why, you ask, would I opine that a 20 handle schnitzel wouldn't shock me and not be dancing with Hoofy? Well, for one, I think that rally will ultimately be fadable and the risk/reward doesn't line up in my mind's eye. I still think we get a sharp rally at a point but I continue to sense that it will trigger from lower levels. Also, and perhaps more pertinent to our "one step at a time" methodology, the internals (and financials) act fugly and I'm gonna dance with who got me here.

The I.I numbers came out this morning (sorry) and there's no fear in Minxville. These aren't daily guides, mind you, but the serve as a sentiment "flavor." I follow other sentiment instruments that are getting fairly negative (bullish) but, again, I don't see enough ducks Peking around the corning to justify a Hoofy ho-down. As a function of my big picture thoughts and developing "Shim Sham" thesis (rally to S&P 870ish, HARD sell-off, stiff rally), I'd rather count to ten and pick my spots on the short side. Is that too cute? Prolly--but it's in my head...and now, it's on your screen!

I'm gonna go splash some water on my face and prepare for Sushi, er, SashimiWednesday (no carbs, baby) so lemme hop. I'm sure that many of you are tempted to load the boat here (heck, I'm tempted to schnitzel in some exposure!)--but I'm gonna defer to the gods of discipline. What should you do? Make decisions consistent with your thoughts and particular circumstances--you're the one who's gonna cha-ching if you win or pooh pooh if you lose. There will be no looking back, friends, so identify a horizon, define your goals and--always--trade to win.

Good luck, Mon Frere.

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