If an "up" morning gets smacked, does a "down" opening get bought?
Born down in a dead man's town
The first kick I took was when I hit the ground
You end up like a dog that's been beat too much
Till you spend half your life just covering up
It's a mild morning in Minyanville and the critters, fresh from a spin class, filed into my office to get an early read on the tape. Boo (wearing a red,white and blue bandana) was sticking close to Hoofy, offering support to his injured pal. He knew that, despite their competitiveness during the day, they were on the same team when it really mattered.
Boo: Keep your head up, kid...this too shall pass. The news out of the gate isn't that great--AMAT pooped and was cloudy on guidance, Monty downgraded GM to a sell, Goldman was cautious on COF,the economic data out of Europe continues to be dismal and the geopolitical game of chicken is drawing near. It's scary out there, Hoofs--but know that you've got a friend in me.
Hoofy: Thanks cookie...this game gets so heated sometimes, it's easy to lose your cool. I appreciate your gesture--it means a lot. The news isn't all bad. UBS upped Thornton Mellon. Morgan upgrade VIA (after last night's earnings), Monty upped NTAP, the stochastics remain coiled and the Investor's Intelligence bulls dropped nicely (finally!)
Sammy: Yes, Hoofs, the drop in I.I bulls is nice...but it's far from bullish--it's just a little less bearish. Like it or not, the focus, right now, is on the fragile state of the globe. Washington is talking about trade sanctions against Germany and France (for not supporting us), terror threats are dominating the news flow and, perhaps most troubling, the declines are grindy and orderly.
Daisy: There sure are a lot of balls in the air! Listen fellas, if you try to figure everything out at once, you'll likely be overwhelmed. Take it one step at a time, understand the dynamics at play and watch your tells and levels.
Sammy: Listen to her, boyz, she's spot on. We know upside resistance: S&P 840ish, NDX 980-985, BKX 725 and SOX 280. On the downside, keep your eyes peeled for yesterday's lows as a marginal support--but also take a step back and start looking at the October lows. If we get any kind of whooshage down near 810ish, I think Toddo's gonna call your number Hoofy.
Daisy: I've got it if he needs it (turns and gives Hoofy a wink), right big guy? Tells today include AMAT (and the SOX), Citigroup (and the financials), the horsies (CSCO, MSFT, INTC, DELL, ORCL), the macro tells (dollar, gold, crude), and, of course, our internals.
Snapper: S&P 810, eh? Well, I'm sure that, in the meantime, the entire Menagerie should stay on our toes! In this environment, the tape can change on a dime and we've got to remain adaptive (NOT reactive) as we find our way.
With that, they gathered in the middle of the room for a (quick) group hug and turned to face the music. It was Hump Day in Minyanville and the critters knew, if nothing else, that all starts with attitude. Think positive, keep that right hand up and always play to win--we'll get there.
See you after the opening.
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