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Tuna Melt


Fare ye well into the closing bell!


All my ex's live in Texas,
And Texas is a place I'd dearly love to be.
But all my ex's live in Texas
And that's why I hang my hat in Tennessee.

(George Strait)

Well partna, it's almost time to saddle up and ride. Hoofy is sporting his ten gallon hat (chewing on a piece of straw), Boo has a pair of leather chaps on (bad visual), Daisy looks delicious in her sun dress, Sammy is psyched to see his friends and Snapper...where is Snapper? That seems to be the question on every trader's lips today!

As is typical with expirations, the action will bookend the trading day. We had the index stuff come off this morning, alotta posturing intraday and individual issues going to bed tonight. Thus far, the trading session has been unremarkable as the technical tetherball continues. If yesterday's mess taught us anything, however, it's the need to pay heed to the tumbleweed.

I nibbled on some of my intraday stuff (when it dipped red) but, for the most part, I'm still trading (from the short side) with tight upside stops. That's the aggressive exposure, mind you, and regardless of how that plays out (win, lose or draw), I'm gonna head into the weekend with two-sided gamma (skewed to the south side but protected up north). I continue to hear about how oversold we are and that we're overdue for a bounce. It can happen, sure, but I'm still of the humble (and lonely) view that the tide may have turned (and rallies should be sold).

Has the dynamic shifted in the marketplace? It feels like it...but the real test will be when the next upside attempt comes. If it's not a brash flash and the internals (leaders) don't confirm, it'll likely set up as the failed rally that some technicians are looking for. The tricky aspect, as far as the Burned Razor thesis is concerned, is that the thesis called for a soft November and a Snapper into year end. I'm not sure if the downside is done but, either way, it's clear that the critters have some thinking to do.

Before I go, I wanted to share an email from a fellow Minyan. It reads:

Nice reference to Sornette's work. I am no super-quant, but in my view his mathematical application of behavioral herding is an expression of the denial-migration-panic process that you've described over and over. I think the similarities are almost Pavlovian, stimulus-response type stuff. Market participants become immunized to repeated positives (negatives) and top (bottoms) are formed when there are no additional "stories" to integrate into the prevailing trend. This combined with a desperate human need to rationalize the actions already taken (denial), makes the migration (happening now perhaps) choppy and asymmetrical. Ultimately it feeds on itself (Sornette's theory of competition between positive and negative feedback). The only way to gain objectivity is through the super-quant approach, or to stay above it with the help of imaginary friends.

So that's about it from the Minyan ship and I've got some doggies to punch before I punch out. More than one trader has hit me up saying that the Monday before Thanksgiving is typically up so, once again, the gamesmanship is out there. If you're unsure and cossing toins, take a deep breath and imagine the market both up big and down big. If you're uncomfy either way, you're likely positioned too aggressively. Remember, friends, opportunities are made up easier than losses.

Have a fantastic weekend!

No positions in stocks mentioned.

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

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