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Trick or Treat?


It must be October, my friends. The leaves have started to shift their hue, the Yank's came from behind on a dramatic post season home run and the great American stock debate has picked up en masse. I'll tell ya, every time the tape stages a spirited sprint, the water cooler buzz starts to focus on whether we're out of the wood this time. While I have my inclinations, you'll never hear me tell you what the market will do. I will, however, walk the path with you as we find our way. Let's take a look.

We fire up our turrets this morning to find Europe's cart following yesterday's stateside stallion and the bourses (as of now) holding onto their early gains (watch that DAX though!).With the drubbing that they've taken over the last six months, some upside "ebb" is to be expected. Their markets, like ours, were deeply oversold. As that condition is "worked off" as a function of the green seas, we find ourselves dancing between the "cusps" of the tape once more. In other words, once a bungee cord is stretched far enough, it's sure to snap back some. How far that "some" is...well, that's what makes our job interesting.

The DELL chatter on the street seems to be focused on them being the best house in a bad neighborhood. While they continue to beat their chest and take share, they really didn't offer us any hope with regard to the overall environment. Yesterday's trading, however, had little to do with DELL. The macro funds seemed to be pressing the short side on the opening (big SPY and QQQ prints), and they walked smack dab into an asset allocation. Now, do I know this for sure? Nope. But it makes sense that managers would wait until the new quarter before shifting around their asset mix.

So where do we go from here? Well, consistent with our goal of looking at the big picture as a series of little pictures, we cast our eyes toward our trusty levels. As discussed yesterday, when the S&P got through the 825-830 zone, it had room to 850 and, perhaps more importantly, 870. In the NDX, lets call 900 a potential level of contention. Now, does this mean that we must trade to these zones? Not on a bet. But these technical levels do give us a backdrop with which to trade our ideas against.

Finally, on a housekeeping note, we want to make Minyanville all it can be for you. As you know, this is an interim site...the town of Minyanville is slated to officially open on December 3rd. In the meantime, we'll be tweaking the particulars of this platform and will ask for your feedback on various issues. Question of the day: Do you prefer the trading thoughts "white on black" (as it is now), or would a more conventional "black letters on a white background" be better? Please email your responses to and we'll tally up the results and act accordingly. Thanks!

Have a fantastic day.


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

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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