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Random Thoughts


Minxy Monday continues to meander as Boo and his crew try to turn the screws.

  • Minxy Monday continues to meander as Boo and his crew try to turn the screws. First up on their weekly "to do" list? Morph S&P 1400 from support to resistance. They tried to do it on Friday but the bovine didn't blink. In fact, I'm hearing that very fact as a potential bullish element today.

  • What's my take? I've long said "As go the financials, so goes the tape" and that action (BSC -$4, GS -$3, FNM -$1.25), coupled with the rolling homies (HGX -2%), bodes well for a leg lower. Yes, there is something to be said for the semis (SOX +60 bips)--which is lending to the "N's over S's"--and metals (XAU +90 bips) but the piggies are the lens that's been working.

  • My two long side faves remain Goldenstar (GSS) and SunMicro (SUNW) and I've still got 'em "against" my spate of out-month gamma (puts). If we break lower, again, I'll look to roll down some stops and play with the house's money. If we rip higher, I'll take the cork off my forks and define my risk as described. Either way, I have a game plan, which is a good thing no matter how ya slice it.

  • This might explain Phoebe's predilection for tie-dies?

  • Microstrategy was the prick that popped the NASDAQ bubble in 2000. Will the heretofore obscure New Century Financial serve a similar role for the finance-based debt bubble?

  • Some big, gorilla financials are set to report this week, starting with Goldman tomorrow. A snapshot of both the banks (BKX) and the brokers (XBD) is telling as both attempt to use their 200-day moving averages as a bovine backstop.

  • If you get confused, just listen to the music play!

  • "My position? Both sides. I think 2007 will prove to be an exceptional trading environment, frustrating both dedicated longs and shorts who refuse to (or can't) be nimble." Professor Ryan Krueger on today's Buzz.

  • Answers I Really Wanna Know…

    • Will tomorrow's Goldman report be the next discernable market catalyst?

    • When is the last time we saw "N's over S's" as we are now?

    • While we're clearly seeing some sector rotation, can the market run without the financials leading the way (XBD-1%).

    • How could the NCAA snub the Orange like that?

    • Is Dow Chemical the next monster take-out target?

    • Is anyone else excited for Spring?

    • Will the stealth drippage in Bear (BSC) and Goldman (GS) be enough to breach S&P 1400, thereby allowing me to roll down the stops on my metaphorical fur.

  • "See the log chart of the S&P Homebuilders Supercoposite that my firm tracks. The gigantic flag is rolling now as the trend line has been broken. The amount of inventory, amount of foreclosures and lack of cheap financing is a nasty combo as I have been saying here. The next support in my book exists at 500, or about 17% lower from here." Professor Bennet Sedacca on today's Buzz.

  • And finally, some wise words from our friend Mr. Practical…

    "YAWN! This is the typical response when I try to lay out for people why they need to be concerned. It is really simple in my simple mind. When markets are lending, when credit is being created, things look good. Money is everywhere because people can borrow. This is inflation. When markets want that debt paid back, things get ugly fast. Money dries up because people can't borrow anymore. This is deflation.

    My concern stems from the fact that over the last several years it is the government stepping in and artificially "forcing" the market to lend more than they wanted to. Blame the banks if you want for greed, but they are just taking their cues from the Fed. Now we find way too much debt in the system. Sub-prime is the first casualty as it should be. The bulls claim that this deflation won't spread. I do not believe this: everything in the economy is at the margin and one little leak can spring the dike."
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position in financials, fnm, gss, sunw, metal equitites.
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