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The Eleventh Commandment

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You want some of this, Izzy?!!?

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You talk about people, you don't even know
And you talk about places, you NEVER go
You talk about your girl, from head to toe
I said your mouth's moving fast, and your brain's moving slow


(Run-DMC)

Minyanville is a peaceful community and we're generally tolerant of variant opinions. However, something's come to my attention that requires immediate discussion. Saddam Hussein's lieutenant., Izzat Ibrahim, spoke at an Arab summit in Qatar yesterday and blasted a Kuwaiti representative. "You're a monkey and a traitor" he began, before adding "Shut up you Minyan, you agent, you monkey! You're addressing Iraq!" Uh..exsqueeze me Izzy? Are you tawking to us? Thou shalt not use the Minyan name in vain--and leave the monkeys out of it too! They're good critters!

Sorry--I had to get that off my chest. I'm viciously protective of my fellow Minyans and won't stand for slander in our humble little town. I understand that DEFCON levels high in the Middle East--there was another terrorist explosion in Israel this morning, Turkey has given U.S troops the wink and there's renewed (low level) chatter that the Osama trail is heating up. While it's important for us to monitor developments in that region, we must keep an eye on our stateside metrics as well.

Research this morning is fairly light. Solly was positive on XOM and (incrementally) CSCO, Lehman was negative on ORCL and Merrill cut numbers in DIS. On the macro front, the dollar continues to act slippy (George Washington is at a four year low), crude is marginally higher and gold is flat is a pancake.

As we discussed in the today's first post, there are some levels in our midst that bear watching. The NDX is sitting on the trendline (next support is 970 and 950), The S&P is a stone's throw from February's closing low of 817ish (next support is 806), the BKX 700ish level is huge (last support before the October lows) and SOX 280 is on everybody's radar. On the upside, use the previous "higher lows" as potential areas of stickiness.

Tells today include the financials in general and the brokers in particular, the semis (semi-caps), retail (KSS), Cyclicals (GE,GM), MSFT and CSCO (sentiment), the macro tells and, naturally, our internal measures. The downvolume/upvolume yesterday was 10:1 which, according to Elmo, is indicative of "long" selling." Keep an eye on that measure today and also be aware that the I to the ISM non-manufacturing number comes out at 10am (exp. 53.5).

It continues to be whisper thin out there and you can bet that the Osama chatter will once again move stocks. It's the very definition of ungamable but we must respect the potential for it to create volatility. I've got just about enough (defined risk) exposure to justify my lone bear leg but I'm surely not pressing. Remember, it's not necessary to play every move, it's only necessary to have a high win percentage on the moves you choose to play. If you're toin cossing, take a step back and await an edge--it'll show itself.

Hit 'em hard.
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