A Razor's Edge
Hey Hoofs--you got Daisy's phone number?
Broken bottles under Hoofy's feet
Bodies strewn across the dead end street
But I won't heed the battle call
It puts my back up, my back up against the way
The ticks tock and the red spreads as our Friday session unfolds and the tape is precipitously close to breaking support. For all you holiday shoppers, there's a rather large Gap in the S&P's (from the November 14th opening) that kicks in below 890 and works to 880ish. Put it on your radar.
It sure looks fugly out there but, if there is a glimmer of hope, it's that some shooter just walked into the pit and bough 55,000 QQQ December 25 puts. We know that this type of flow is inherently bullish as trading tops are characterized by hope and, as an extension, bottoms typically see large put buyers (fear). Is this enough to turn the tape all by its lonesome? No...but it's enough to raise a collective eyebrow among the critters.
A check of the morning breadth reeks of halitosis as losers are trumping winners better than 2:1. The slippage is evenly distributed across the sector bases but the issues of the day are more macro oriented. S&P just downgraded Venezuela and that's only adding to already existing force already created by the dollar and crude. In addition, it 'feels' like traders continue to be "trapped" from the previous rally and the more the Minx shaves, the more likely the chance of a Razor Burn.
On a brighter note, there's only five hours left in the day before our requisite two day respite and weekend full of football. The Silver and Black have a big match-up this Sunday (cry, Ricky, cry) and, as such, I thought it was only fitting to quote Raider quarterback and (potential) M.V.P Rich Gannon when he says "I realize how it can all turn around so fast on you. I learned a long time ago that the same things that make you launch in this business can make you cry." Hmm...we can relate to that!
Keep your wits about you, my friends, and don't play just for the sake of playing-it's nasty out there. Watch the BKX as it should once again prove telling as the day trades on and remember to breathe.
I'll be back.
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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