A Minyan Festivus
These bulls better get on their horse if we're gonna stampede into year end!
Good morning and welcome back to the fun and games. We slide our quarter into this morning's Minxy pinball machine to find marginally weaker European bourses and anxious stateside critters. With a scant fifteen sessions remaining in the calendar year, each flickering tick will assume added importance as we forge our way through the trading muck. Will Hoofy & Co. once again finish the year with their high score or can Boo & crew tilt the table in the bears favor? Put down that cotton candy and finish up that corndog, cookie-it's time to take a walk through the carnival.
Friday's disappointing economic data had the ursine sharpening their claws as they prepared to sweep the week on the south side. Before they could put the bovine down for the count, however, word came from Washington that two of the casualties were big shots from Dubya's administration. Almost immediately, speculation of an aggressive stimulus package made the rounds on the trading desks and Hoofy found a place to hang his hat. The oversold tape had a glimmer of hope and, on cue, the bulls scratched out a narrow victory.
We enter this week with the market at a critical juncture (shocker!) and the year-end rally prospects hanging in the balance. With the technical lines in the sand holding the first go 'round (no shocker there), traders will once again be focusing on S&P 900 and NDX 1050 as levels that must hold if the bulls are to have a chance. To be sure, a failure below those critical levels will leave Hoofy nursing his Razor Burn as he greets baby new year.
No week would be complete without directive from the fundamental arena and we'll get our fair share over the next five sessions. There will be conferences in Telco (Lehman), Media (CS First Boston and UBS Warburg), Semi's (the mighty Bear) and Storage (Solly). Rounding out the catalyst parade will be a spate of mid-quarter updates, a slate of company sponsored meetings and a plate full of economic releases. In addition, we should keep our eyes peeled for some chilly news out of Washington as replacements in the administration are due. As it stands, speculators are forecasting Snow!
By now, we know the dynamic in play all too well. The buyers are higher as they can't let the market rally without them and the sellers are lower as those who bought because they "acted well" will have lost their catalyst. In between, the hedge funds are playing hot potato, the macros are flexing their muscle and the individual is looking for direction. It's a high stakes game of chicken, Mon frere, and to the victor goes the spoils. Keep your wits about you, understand that emotions are high and, no matter what happens, remember to think positive.
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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