Are You Experienced?
What are you, a midget?
Hey Joe, where you gonna run to now?
Where you gonna run to?
Hey Joe, I said where you gonna run to now?
Where you, where you gonna go?
The morning storm was true to form as the lows were probed and the bulls then swarmed. There are a TON of crosscurrents floating around so, without further ado, let's roll up our sleeves and start diggin'.
The underlying tone remains quite fragile and, despite the green screens, it's not giving the love yet. The brokers are smokers (deja Boo), the breadth is barely hanging onto the plus side and we're still in a pronounced downtrend of lower highs (and lower lows) that started Friday. The semis do act well, mind you, as the SOX tetherballs around the 500 level. As it stands, they've tacked on a percent and lending to an N's over S's environment (it's early).
The fate of today's tape comes down to how many newbie shorts recently pressed vs. the long money sitting on the sidelines (waiting to make sales). This is prolly a prime example of the buyers being higher (covering) and the sellers waking up lower (holders). The macro tells, namely gold and the dollar, remain marginally equity friendly (vs. sentiment). If the dollar can extend its gains, it'll likely spook some guys out of their fur. Also watch Citigroup (C:NYSE) as it's tug-o-war city.
S&P 1040 and NDX 1380 is the nearest term upside resistance. They represent the short-term trendlines and, in the case of the NDX, yesterday's breaking point. The S&P (and BKX) have also managed to (thus far) hold their 50-days and as long as they do, Hoofy will continue filing his nails. It's jittery and jumpy out there, my friends, and I've set very tight stops on my intraday stuff. Still, if you put a water pistol to my head, I'd say I wanna be short under these near term levels.
As always, I hope this finds you well.
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 email@example.com.
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