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Appreciating the Moment


Slow down you move too fast
You got to make the moment last
Just kickin' down the Bronco clowns
Lookin' for fun and feelin' groovy

(Simon and Garfunkel)

After dropping four straight games, I should probably know better than to gloat-but I can't help myself! There are few things in life more enjoyable than beating the Broncos (in Denver, no less) and, for those who are unfamiliar with this rivalry, let me assure you that victory tastes sweet. Fair warning though, Monday Night Football games run rather late on the east coast and by the time my adrenaline rush subsided, it was almost to make the doughnuts again. Hey...If Rich Gannon can give that kind of an effort, so can I! Wasabi!

The leaves are beginning to fall in our humble little town and Minyanville is a picture of serenity. The University is winding down its winter session and, with final exams slated to start next week, the hill is particularly active in the background. The elder critters, meanwhile, are briskly walking down Main Street and reading the Gazette on their way to work. They know, as we do, that the psychology of the market is in a more fragile place this morning and today's price action is will help shape the collective perception.

On the heels of a 9% pullback in the NDX and a 5 ½ % retreat in the S&P, the "buy the dip" crowd now has their chance to add cheaper inventory. A week ago (when we were near our highs), the most fervent bulls would have jumped at the opportunity to add exposure at these levels. Now that we're here, however, it'll be interesting to see how many of them step up. One thing for sure, the trading crowd is reactive and will likely become emboldened at higher levels and a bit more timid if the tape begins to slip. As we find our way, make sure you respect the price action-but don't defer to it.

Our technical levels are much the same, with support coming into play at S&P 870-875 (then 850, then 830) and resistance at (former support) of S&P 895-900. For the tech-heavy NASDAQ, support is NDX 950 (then 900) and resistance is NDX 1000 (then 1050). Key tells today will remain the BKX (down 8% from its recent high) on the big board and the SOX (down 15% in a week) in four letter-land. Peripheral tells will include the greenback (U.S Dollar), Oil (war proxy), the Microsoft/Cisco/Intel trifecta (horsemen), retailers (consumer) and the internals.

I enter Turnaround Tuesday with one leg in my metaphorical bear costume (25%) and a few questions in my head. While my broader thesis continues to have a negative bias, I can almost hear Hoofy giving his troops a pep talk this morning. Plus, if (big if) the "Razor Burn" thesis plays out, there will be some upside to capture before a (perceived) melt comes to fruition. Does that warrant a cute switcheroo into Hoofy and out of Boo? The answer to that question is a function of your individual style and the time frame in which you view the market. For my part, I'm not certain how I will approach it but you know that-if nothing else-you'll get my honest read on these pages. One step at a time.

Good luck today.
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