Who's your turtle?!?
While the firelight's aglow
Strange shadows in the flames will grow
Till things we've never seen
Will seem familiar
It's whites of the eyes time in the city of critters and Snapper is trying to get his groove on. If you listen closely, you can actually hear the shorts squirming. I've been there and trust me, it's an awful feeling. Still, we must assess the collective mindset as we attempt to craft a navigational strategy. The price action, when broken down to it's most basic definition, is a function of supply and demand. If there are nervous shorts out there and they're getting squeezed, it'll likely exacerbate the near-term upside (while removing a future layer of demand).
I've got three day charts up of the NDX and S&P and the most recent lift took us through the downtrend line in the N's at to the same line in the S's. There are also short-side stops set above S&P 800, most likely, and if the Minx continues her jig, it'll likely spur another round of short covering. Finally, understand that S&P 806 (the previous February low) will likely act as a resistance as well.
What's caused this turnaround? There's chatter that the Europeans have pulled their sell orders although I have no way of knowing if that's true. More likely than not, it got a tad too negative and pressy--and when the banks started to turn, it freaked out Boo's brethren. Am I fading (read: selling) this rally? No--I've actually been schnitzeling some SPY from the long side but I'm staying VERY tight and will likely go home flat.
I've gotta hop, juggle and dance--hang in there Minyans, less than an hour to go.
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.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Daily Recap Newsletter