Boo's your daddy!
Are you living a reality
I left years ago it quite near killed me
In the long run, it will make you cry
Make you crazy and old before your time.
The quiet storm continues as Snapper grinds his way towards gap fillage. As our frisky turtle "fills" the opening void in the S&P (from yesterday's opening), we should get a better read on the fortitude of today's bulls. That level, for all you active observers, comes into play around S&P 863.
Today's trading themes have become a bit more pronounced as we edge through the afternoon. Bonds are getting slapped lower and that's adding to the speculation that asset alligators are swapping bond exposure into equities. Brian Reynolds has done some fine work in this regard and if you'd like to further your fixed income education, he's your guy. Adding to the constructive psychology is the oil spill (crude getting smoked) and the relative strength in the dollar.
Is today a "counter trend Tuesday" interrupting the prevalent trend (lower) or a successful "backing and filling" after the hard, sharp rally? That's the question on every trader's lips these days and perception will likely dictate reality. As you know, I'm suspect of the Minx these days but I'm acutely aware of the rally risk. As such, I'm playing tighter and lighter than I normally would be and will continue to define my overnight risk.
The S's over N's dichotomy has been pronounced all day and one of two things is gonna happen. Either the S's will suck the N's into some gap fillage of their own or, now that the S's have already "filled," the NDX will drag the S&P lower. I'm wary of flow I can't see (alligators) but I continue to keep my right hand up and my powder dry. I've reestablished some May puts (tech) and, regardless of my daily activity, I want to go home each night with that protection on.
The chatter is shifting from the Pentagon briefing to the quarantined plane (SARS) and it will be interesting to see how/if the Minx reacts. If this IS, in fact, allocation going on, the tape will barely blink (think anthrax post 9/11). If the market starts to soften, look for the N's to lead the way lower. Either way, keep your head up and your thoughts positive --we've always got those Daisy bikini snapshots to look forward to! And yes, female Minyans, there will be a Hoofy pictorial if you'd like to graze, er, gaze.
Fare ye 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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