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Moon Over Manhattan

By

Kiss me--I've got gorgeous breadth!

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Because I'm still in love with you
I want to see you dance again
Because I'm still in love with you
On this harvest moon.

(Neil Young)

The opening screens are flush with green as we edge into the trading scene. The early tone is firmer than a college cheerleader and the financials have grasped the leadership baton out of the gate. It's hard to find fault with the BKX (banks) or XBD (brokers) technicals as they're popping with acne. While their stochastics are twisting on top (bearish) and unknowns remain (earnings), they're showing no signs of wiltage. If the razor is gonna burn, the financials will have to fan the flame. Watch this complex as a chief trading tell.

A quick check of the morning breadth is rather minty (3:1 positive) and all signs point to a testage of our much discussed S&P 1050 level. Outside of the draggy internet action, there aren't many flies in today's ointment. The dollar is firmer, gold is soft, Europe is jiggy and the tide is rising. It's reminiscent of Thursday's tape, to a degree, and that reticence (to bite) may prove to be a bullish input.

I'm treading carefully in today's (thin) action and looking for front month cheapie punts (both ways). Earnings will typically pump volatility (to unattractive levels) so I'll sometimes look to identify periperheral plays (names that trade "with" companies that report this week). Option pricing mechanisms are generally efficient in that regard but if we marry our metrics, a tangible "edge" will often emerge.

I'll be back.
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 todd@minyanville.com.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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