I hate those darn things!
A boy tries hard to be a man
His mother takes him by his hand
If he stops to think he starts to cry
The nose scrunching continues in Minyanville but this time it has to do with the potential "bull trap" in the making. What's a bull trap? It's when an influx of optimists race into the market for the rally that never materializes--and they're caught long. I'm not saying this is definitely the case Hoofmo but, after yesterday's jig, it's entirely more likely than "straight down." You saw the size call buyers on the rush higher--now let's see if they wanna buy 'em as they're coming in.
My buddy Nipples (don't ask) pointed out the two-day trendline in the Spooz that was violated on this pullback and while I wasn't focusing on that, it's worth a mention. I was more focused on my 21-day S&P chart at the trendline we discussed in the earlier post. I'm also monitoring COMP 1320 in techland as the inflection point in four-letter land.
(Deep breath) Ok, So whatawe got? The semis, after their earlier relative strength, are showing signs of slippage and that must be monitored as a sentiment tell. With the weakness in the financials today, the Minx can't afford (literally) to have Red Sox enter the mix. Finally, the breadth has yet to visit positive territory today and that's been the best tell of all.
With regard to flow, Alice, I've seen a LOT of call buying and put selling (bearish) today along with some sizable stock replacements. That last input (stock replacements) will likely skew the put/call readings and make them look more bearish than they are. Also, I've begun to pick up overseas selling in the futures pit and while I don't know if it's an isolated order or the beginning of a trend, I wanted to pass it along.
I picked small near the opening but didn't put 'em back out into the lift. As discussed, I've got some defined risk downsides on and, other than that, I'm doing a bit less as it's unclear. There's no shame in admitting it's hard, my friends--it is. Just remember, if you only trade six times a year and win all six, you're headed to the Hall of Fame!
Speaking of all-stars, the Buc's fan from Tampa continues to bid $12,000 in our charity auction and he's sitting on top of the leader board right now. I've already dusted off the seat next to me, Daisy has picked up a couple of new outfits and Snapper is gonna break out his Sax! In other words, we're ready for ya and it's gonna be a blast! If you'd like some more information on Jacob's Cure, please visit the website at www.jacobscure.com. Thanks!
I hope this finds you well.
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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