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Schoolhouse Rock!

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Got it bad, got it bad, got it bad
I'm hot for teacher
I got it bad, so bad,
I'm hot for teacher


(Van Halen)

Two sectors taking it on the chin this morning are the education stocks (off of CECO) and the electronic gaming stocks. I don't know if we can extrapolate anything from these two groups today other than the market's lack of tolerance when she's disappointed. Keep an eye on these two groups for any sign of shrug (sentiment gauge) and, whatever you do, don't upset Principle Minx!

An early stand by the bulls is to be expected as traders are conditioned to buy the first dip. I have been saying for days that this psychology is bullish...until it's not. What I mean by that is that the traders who buy the first, second...even third dip because the market "acts well" will lose their catalyst if the tape continues lower. It's just worth noting as two weeks ago the chatter in the hedge fund community was "let them go up, I'll short more" and now the mantra is "let them come in, I'll buy more." Weird.

A quick smell of our morning breadth shows both the Nazz and the big board 3:1 negative with downvolume swamping upvolume. The early traction in the banks (again) warrants attention, but I will say that the stochastics in the BKX are pixels away from confirming a sell signal. Meanwhile, the consumer non-durables (soft goods) and telco names act relatively dry in a down tape.

I'm keeping half an eye on those bonds (still up) and keeping Boo by my side. He really is a good bear if you get to know him...he's just a bit saucy at times.

I'll be back.

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.

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