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The Smell Tell

By

Discipline over conviction.

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One little problem that confronts you
Got a monkey on your back
Just one more fix, lord might do the trick
One hellofa cost for you to get your kicks


(Lynard Skynard)


The opening fray is underway and freaky Friday is upon us. The early focus is clearly Microsoft (MSFT:NASD) as the Redwood dead wood is getting burned for 7%. The critters--and everyone else, for that matter, are wondering whether the Minx can once again shrug and hug. Lookin' pa nub? Come right this way...

The knee jerk reaction, after yesterday's yawn, is clearly to buy the first dip. We've seen that en masse this morning and there's been size short covering in the QQQ. Again, you can't blame the bears for having Snapperphobia--there's only so much fur that fits in a furnace--and this is a critical level. In addition to the gap risk below, the NDX is now sittin' near the 50-day moving average (NDX 1358). The bulls are acutely aware of this fact and have dug in for a battle.

A quick check of the morning breadth shows three losers for every two winners but, again, it's early. The semis are trying to lead by example (marginally green) and the banks, thus far, are down small. Away from the equity plays, gold is a finski higher, the dollar index is making new lows and the Yankees have some serious pitching issues.

Again, the first fade was the easy fade. Now, we've got some 'splainin' to do Lucy. If they can rally, there may be a short side capitulaton (after holding support again). If they fail, it''ll be most obvious (Microsoft). Identify a strategy that allows for a margin of error and, above all else, think positive--it all starts within.

Finally, apologies on the "auto-music." It should default to "off" but there's a technical glitch that we're fixing as we speak. Just blame Fokker (although it wasn't his fault) for the slip up. Too much Panama Red!

I'll be back.

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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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