I've got plenty of Clearasil in my back pocket!
Good morning and welcome to top button talk. After three days of sway and a play day away, it's once again time for the minxy café. The session is short (so be a good sport) and skeletal crews will hold down the fort. As we ready for the show, what we wanna know is if the acne above is destined to grow. Can Hoofy push through the technical zoo or will Boo render rumors of upside untrue? It's a short Friday session of trading obsession so stay disciplined and control your aggression.
Having spent the holidays with my brother, I'll be spending the next few hours operating out of the Baltimore office. Basically, what that means, is that I'll be monitoring the action with two screens in front of me and two kids around me. I'll do my best at the former (while enjoying the latter) but please understand that I'm operating with skeletal systems of my own. Hey-after the obscene volume of food that I ingested last night, I'll take all the skeletons I can get!
Taking a quick walk through the 'Ville, chatter of possible Japanese tariffs around on Wednesday but seemed to get a bit louder since. The greenback attack is in full force as the dollar index (DXY) flirts with the 90 level for the first time since late December 1963, er, 1996. The shruggers will (correctly) argue that the dollar squalor has been in motion for months and equities continue to press up towards yearly highs. Hard to argue with performance, I suppose, but a melting currency has always been one of the catalysts for my bigger picture fears. Call me old fashioned or call me wrong---just please don't call me for breakfast. I'm on a hunger (digestion) strike.
S&P 1060-1062 remains the upside line in the sand and, as it's month end, there will likely be some gamesmanship to break on through to the other side. It would be nice to think that this type of thing doesn't happen-particularly during these times of regulatory scrutiny-but there are surely fund managers out there looking to giddy up the thin pup. Our mission in the rain is to identify whether to act on the acne signal (if and when) or to recognize that, with everyone in the free world looking at the same level, the trading community is probably loaded to the toes (and thus, vulnerable to a false breakout).
It's academic-for now-but trading 101 dictates that with every test of resistance (support), the underlying supply (demand) gets eaten up. Thus, after 5 tests of the ceilingfest, the bears are on their heels and seemingly ready to squeal (again). Watch the financials for leadership, the semis as a tech sentiment, retail as a holiday shopping proxy, the dollar for outsized moves, the internets and biotechs (leading four-letter tells) and the clock. In about three and a half hours, we can get back to the important stuff.
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 firstname.lastname@example.org.
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