Traders in Arms
You play the guitar on the MTV
That ain't workin' that's the way you do it
Money for nothin' and chicks for free
Well, I think the tech mavens have finally located the bug in the system and not a moment too soon. Too bad...after a week of the flu, a Friday of yanks and the Raiders third loss in a row, I was really enjoying the technical glitches that were crashing my system every 15 minutes! You ever get that postal feeling? Hello Newman!
So, after the vicaden wore off, the four main reasons I picked up for the dollar slippage were 1) The incessant chatter of the imminent rate cut, 2) speculation on the potential failure of this latest rally, 3) technical pressures and 4) Iraqi concerns. The action seems to have stabilized, but add this ball into our daily juggle as we continue to find our way.
A lot of technicians are pointing to the S&P 900 level and arguing that the "tick" at 905 this morning confirmed a triple top breakout on a point and figure chart. This brings us to an interesting point...when a pattern confirms a breakout (breakdown), does discipline dictate acting on that signal irregardless of field position? As a trader who's "technically oriented", I've always used this metric as a backdrop rather than a pure tool. In other words, I'd be more inclined to play a technical breakout if the market was oversold, the stochastics were close to a buy signal and I had a "story" that I believed in. Still, it's worth a mention as it potentially "works" to 925 on the S&P. Just an FYI.
Other than that, it's very quiet as traders digest their lunch and the tape digests the crosscurrents. I have to jump into our midday mindmeld, so I'm gonna cut this post short. Apologies...it's just one of those days.
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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