West Coast Flava
I'm going, going, back, back to Cali, Cali...
Head so hard, that ya hat can't fit ya
Either I'm witcha or against ya
Format venture, back through that maze I sent ya
Good morning and welcome back to the saddle. The critters are here, red eyes and all, and ready anew for a new minxy brawl. They traveled all night to be by your side, a heckuva trip that they all took in stride. Once in the 'Ville, fresh joe in hand, we took a quick look at supply and demand. We chewed as we chatted, taking it in, and knew that the fun was set to begin.
When we last dialed into our favorite reality show, Hoofy was enjoying an obligatory late Friday bounce. It was the end of a tough week for the brazen bovine and, after absorbing a spate of ugly headlines (Refco, Delphi), technical breakage, inflationary scares and consumer concerns, he felt pretty good about himself as he hoofed into the weekend. That optimism spilled into further Monday fun and, after a flurry of fundamental follies, faded in kind on a Tuesday unwind.
That, of course, brings us to today's Hump, where men are men and sheep are nervous. The first thing my tired eyes arrived at this morning was my trusty chart of the S&P. We've discussed the trendline that's been in place since August 2004 and that's where Hoofy seemed to stumble (S&P 1190-92). One chart does not a market make but after the technical damage he's endured, he must mount each Hump as it comes. That, along with the tech sandwich that is NDX 1530 to 1550, will be on my early morning radar.
We also awake to find our pals across the pond taking it on the chin. The overseas bourses have put our stateside performance to shame this year and it remains to be seen how this spate of supply will play out. The underperformance of America isn't a popular topic but it's a dynamic that must be respected. Having isolated ourselves from the rest of the world, the "other side of globalization" can manifest in a number of ways. While the dollar has kept a stiff upper lip, US equities clearly lack the panache they so proudly once sported.
We're chewing through a slew of dew as we edge back to reality so I'll keep today's missive short and sweet. Earnings are coming out fast and furious and that'll offer sparks in the dark on the sector rotation front. With October expiration a few days away-and the meat of the action likely to arrive today-keep your wits about you and you risk profile tight. There are alotta anxious agendas out there, Minyans, and our goal is to stay on the bus rather than under it.
Good luck today.
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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