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Henley's Heroes

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Fare ye well into the bell!

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Who can go the distance?
We'll find out in the long run (in the long run)
We can handle some resistance
If our love is a strong one (is a strong one)


(The Eagles)


The afternoon fray is a minxy array of bulls trudging through the two-sided fray. The initial probe of S&P 1100 once again spurred the buy programs and the bovine haven't truly been challenged since. Now, with the benefit of the newfound wind at their back, they're trying to recapture some of the technical humps that fell last week. NDX 1440 is a biggie, as is Russell 570 and CYC 681. And lest we forget, the piggies are back above both the 50- and 200-day moving averages.

Levels are swell but in an environment with more swings than a Hedonism vacation, they can produce mixed signals. That, in a nutshell, is why alotta technicians are so confused these days. We broke out (positive), broke down (negative), regained some levels (positive), failed anew (negative) and now we've got a mixed bag. All of this, of course, during the last earnings of the year while the elections are drawing near and the Red Sox almost disappear.

Crude likely contributed to the jump start as it's off 3% from the daily highs. That's been a contributing factor to many a bear thesis and while this may be yet another (downside) head-fake, we must factor it into the "perception is reality" mix. I still sense that there's a meatier pullback to the Texas tea (before the election) but I've been saying that since $50ish. Still, and while that would be a positive equity input, it's by no means a ticket to ride. Terror jitters and electoral uncertainty should continue to shape sentiment and there's no guarantee of resolution on November 2nd.

Int'l Business (IBM:NYSE) and Texan (TXN:NYSE) will highlight the after-school hours while a slew of big caps take tomorrow's center stage. While Big Blue will likely color tomorrow's opening, this release is important in other ways. We've had a series of smackings in widely held issues--Merck (MMM:NYSE), Fannie (FNM:NYSE), Marsh Muck (MMC:NYSE), AIG (AIG:NYSE), General Motors (GM:NYSE), Novellus (NVLS:NASD)--and while the bulls will argue that it's company specific, Beamer would be a rather large straw on top of an already fragile camel. I've got no edge on this particular release but I'm certainly cognizant of the desert storm in which it lives.

I'm gonna jump back to the Buzz and ride out the remainder of this session. These are tricky trading times so please be careful and maintain your discipline. Lotsa funds are pressing to make a year in a quarter and while there is a potential to self-fulfill, that "compression" can be a dangerous thing. That's not a directional observation, just one that may help in adjusting your risk profile to fit the tape. For if nothing else, the onus will always be on us to adapt.

Good luck into the close.

R.P.
position in fnm

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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