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The Juggling Clown


An auction to benefit children's education--what could be better than that?!?


Good morning and welcome back to the holiday sleigh ride. After eight straight winning weeks, the streaky Minx has made it two in a row to the downside as she limps into the December chill. Now, with eleven short sessions remaining in the year, traders are on the edge of their seats as they prepare for the annual Christmas show. Will Hoofy and Snapper tag team the tape to the upside or will Boo's shave session burn the bulls? Hang onto your Santa hats, my friends, and let's get this party started right

It's easy to look back and assign reason to a trading rhyme but profitability is only realized through a proactive thought process. To be sure, hindsight is 20/20 but vision, well, that's an entirely different skill set. As we prepare ourselves for the next two weeks and, perhaps more importantly, next year, I thought it might be helpful to walk through some of the issues that are facing the tape.

Latin America: with the world's focus centering on the Middle East, attention has shifted away from the troubles down south. Venezuela, Argentina and Brazil all have issues and attempted remedies have been short-term fixes and not long-term solutions. As these economies have major implications for the global landscape, they deserve more respect from the trading community.

The Greenback: a thermometer of global confidence in the U.S economic rebound, the recent weakness serves as a warning that sentiment could be waning. The dollar has slid 15% against the Euro and 9% against the Yen this year (which, by the way, has put a crimp in the Japanese "export-led" recovery effort).

Crude: we've been discussing the sneaky rally in the price of crude and we'll need to keep an eye on this for two reasons. First, it provides an excellent proxy for "war psychology" and second, higher oil prices have implications for the economy as it increases the cost of doing business.

Earnings: in the near term, potential preannouncements would roil psychology while, bigger picture, earnings growth will be the key to the bull's recovery thesis. I'm firmly of the belief that cycle turns don't occur at this level of valuation but, with that said, we'll need to keep close tabs on the fundamental arena for signs of life.

Geopolitical risk: war and terrorism. Enough said.

Overseas: during the roaring bull market, the term "global economy" was a catch phrase that bulls threw around to justify the rabid rip-and we can't pretend it doesn't exist as Europe and Japan continue to struggle.

This short list serves only as a starting point for discussion as there are a multitude of factors that determine equity prices but I wanted to make sure these were on your trading radar. I'll walk through the technical levels later today (along with a list of catalysts for the coming week) but first, I wanted to alert readers to some changes that will be taking place.

With year end rapidly approaching and resolutions in vogue, I've made a few of my own and would like to share some of them with the readership. The biggest change is that I'll be running my own fund next year. This is a big move for me and I'm pretty excited but before I make this transition, I'm going to practice what I preach. After fulfilling my obligations this week, I'll be taking my first two week vacation and enjoy the fruits of my labor.

With regard to Minyanville, we've had a fantastic start and to celebrate the New Year, we're going to extend the open house through January. We felt that this would provide ample time to settle into the new digs while allowing our readership to grow and flourish. We continue to attract new citizens on a daily basis and we want to put our best (four) feet forward to begin 2003. The passports will begin on February 1st but, until then, enjoy another free month on us!

Finally, and in the spirit of the season, we're going to begin our holiday charity auction today. A one-of-a-kind signed poster featuring the Menagerie--I won't even have one-- will be auctioned between today and Thursday's close with the high bid (and highest bidder!) updated each day. 100% of the proceeds from this sale will be donated to the Ruby Peck Foundation for Children's Education and the winner will have his name enshrined in Town Hall. It's all about giving back, my friends, and I'll be the first in line to start the bidding!

Good luck today.


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