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Buzz Bits: Dow, Nasdaq Dip Down


Your daily Buzz & Banter highlights...


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Gonna Leave This Brokedown Palace - Todd Harrison - 3:33 PM
  • I hear ya Jerry--when the bloom comes off the rose, the bloom really comes off the rose. As traders put the corks on their forks into the weekend, the only remaining question is how the last few ticks will trickle into our mindset. A few final thoughts as I ready for the innocence of children's laughter...

  • S&P 1376 is the next level to watch as we churn (not base) under S&P 1400. And again, S&P 1400 and BKX 116 are relatively tight short-side backstops for ursine uglies looking to roll down their risk.

  • I'm not being prickly when I say that the mainstream media might need to turn negative before a discernible bottom is put in place. Most all of the comments I've heard this week talked about buying opportunities, catching a bottom and, at times, new highs within a few weeks. And you wonder why there's conditioned complacency?

  • And no, Macke, I don't lump you in that bucket. I think Fast Money is quickly becoming an exceptional vehicle for investor education.

  • There's no uptick in breadth, so you know, and that bodes well for Boo into the close.

  • Deep breaths as we tie up the most wicked week in a while. Remember Minyans, the definition of an investment should never be a trade gone awry. Be disciplined into the close so you can enjoy the important stuff this weekend.

  • Fare ye well.


The Asset Class Pupil - Lance Lewis - 12:32 PM

Over the past four years, all asset classes have tended to move together, as "liquidity" (better known as "inflation"). Generally, the selloffs in commodities were even more violent than those in equities simply as a function of the fact that commodities had rallied so much prior to the selloffs.

This most recent break in financial assets, however, is somewhat different, as commodities (as a whole) have barely even moved. The equal-weighted CRB (in red in the charts here and here) is down just over a percent from its recent all-time high, whereas the SPX is down over 4%. Something is "different" here. I'm not sure what it is, but rather than a general liquidity problem, which one would think would be hitting all asset classes across the board (especially commodities where we have seen so much "financial demand"), we're only seeing a liquidity crisis of sorts in financial assets, mortgage-backs, equities, etc).

Could this be an important inflection point as we draw closer to the day that the Fed is forced to ease in order to cushion the housing bust, and the result is a lower dollar and accelerating inflation? I'm not sure, but I am watching with interest. Perhaps I will regret it next week, but I've also been buying the dip.

Position in gold shares

Randoms... - Fil Zucchi - 11:57 AM

  • I have let "Stumpy" out of the closet and gotten a bit more aggressive with silver (YIK07) as it broke through $13. What I tend to do in these rapid fall scenarios is to buy two contracts to flip one, and keep the other for a longer term position.

  • In equity land, I am covering some of my StreetTracker (GLD) short which I use as a hedge for my long stocks.

  • The Palm (PALM) trade is pretty much over for me. Playing the takeover game in this one is not what I am interested in.

  • The longer the markets bounce around these levels, the more this may be a consolidation before another leg down.

  • Since Feb. 15, there is a 0.86 correlation between a falling dollar vs. yen, and the falling SP 500 (SPX). It may only matter for the here and now, but it sure seems to matter for the here and now.

  • If Akamai (AKAM) could make it down to the 200 DMA, I think we could make a "deal."

Posiiton in AKAM, SPX, PALM, GLD, YIK07

Third Time's a Charm? - Rod David - 8:59 AM

S&Ps converted an overnight gain of 6 points into an 11-point loss. This is getting ugly - not just because several sell signals have triggered in the past five hours, and not just because the last two signals quickly dropped 7-8 points each.

Actually, it is those things, and more, but all viewed through the extraordinary lens of this not being triggered by new news (St. Louis Fed Pres' comments notwithstanding). The only thing "new" is that two days of illiquidity are just hours away.

The market might still make a stand here. With Fridays, it either happens early or it doesn't happen at all. And in this pattern, if it happens today, then it only gets worse Monday.

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No positions in stocks mentioned.

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