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Round Ball

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Good morning and welcome back to the full-court press. When we last left the Fab Five, our critters were engaged in a spirited game of street ball on the Minyanville hoops court. As time was running out, Hoofy was attempting an uncontested lay-up when, out of nowhere, Boo (wearing a red sweatband on his head) snuck up from the weak side and stuffed him! Will the bulls be able to regroup and jam the tape through technical resistance or will the bears once again smother the bovine with defense? Double down on that Gatorade and stretch those legs, sports fans, the opening tip is coming up.

As the game clock ticks closer to yearend, traders seem intent on taking a last-second shot to win the game. It's no shocker-through the years, the market has conditioned players to expect high scoring returns and shooters, by definition, like to step up and steal the spotlight. Recently, however, the fundamentals of the game have changed and the disciplined players have learned to take better, high-percentage shots. It's ball control offense, Minxy style- Pete Carril would be proud!

We've belabored the point that a good game plan requires time management and rigorous practice and our team is being put to a daily test. In the reactive world of technical analysis, it's good until it's bad--and then it's very bad. Take, for instance, our current juncture. We've been watching NDX 1070 as a level of contention as it's failed there six times since June. If the techs can poke their nose through, it would be consider bullish by the technicians in our midst. If we fail, however, chartists will point to the "double top" that's forming in November as an ominous sign for the market. Talk about a two-way player!

A similar situation is shaping up in the old school arena as the S&P trades in the zone defense. As it stands, a "head and shoulders" formation is still a distinct possibility as the index waffles sideways. If, however, the Spoos can take out the previous November high of 925, there will be no more tears in the locker room, please. In minor league action, watch SOX 337 (November high) and XBD (brokers) 430ish (November high and 200-day moving average) as additional levels and, while you're at it, keep half an eye on the BTK (biotechs) for additional signs of dandruff.


The season is winding down and the crowd is frenzied, so clear the mechanism and play your game. When the final horn sounds and we clean out our lockers, we'll have plenty of time to reflect on our efforts. In the meantime, keep yourself in shape mentally and physically as the big boys bang around in the paint. As they exhaust each other, look for the ball to be kicked out to the perimeter-and then take the open shot.

Good luck today.

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.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

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