Fare ye well!
Dressed myself in green
I went down to the sea
Try to see what's going down
Maybe read between the lines
Talk about a terrapin station! Chanting "fear the turtle," the buyers came out in force once S&P 1040 fell. The resulting squeeze was fueled by multiple sevens to buy in the SPY (mostly covers) and, as discussed, the other buyers were higher. The question now becomes one of magnitude and attitude.
I got stopped out of a bunch of my peripheral (day trading) exposure as discipline trumps conviction. With that said, I am using this rally as an opportunity to add some of the longer dated paper. I don't think Boo's spew is complete--not by a long shot--but I'm unsure whether Hoofy can keep juggling the chainsaws into expiration. The path of maximum frustration may dictate that November paper expires before a return to Red Dye Junction.
There's little doubt in my mind that this is a short-covering rally. The zillion dollar question is whether it'll plant seeds of grandeur in the underperforming mind's eye. I don't 'think' it's gonna last...but I also don't know when it's gonna fail (hours or days). Watch NDX 1380 as a potential pivot point as we figure it out.
It's worth noting that the brokers are conspicuous in their absence of participation. That may be a function of simple rotation (into higher beta names and away from the smoke) or it might prove telling. This is a fairly important close from a psychological standpoint. If Snapper gets beat down, it'll quell the ground swell. If he can giddy up the pup, the fur burning will continue.
On that note, I'm gonna juggle hats and tickle ticks as we round third and eyeball home. I sincerely hope you managed the force today and, if not, that you've got the balance to keep it in perspective.
Have a peaceful night.
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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