Hump Day Hop Scotch
I wanna be comfy with my risk profile rather than make up for lost ground.
We're in the heart of the earnings matter and you know what that means--men are men and sheep are nervous! Given the information overload and a genuine desire to cover our bases, I'm gonna invoke my literary license and pump out some Random Thoughts. We've gotta lot to digest, my friends, so roll up those sleeves, double down on that cup of Jo' and let's deep dive into the flickering ticks.
- The metals are jazzy anew, with gold and silver both sporting fresh pre-market jig. This was one of my better vibes in recent memory but, as Minyans know, I snuck out the side door before Frank the Tank started streaking. What to do? Right now, I'm hand sitting as I weigh the parabolic frolic in silver and the similar grin in gold. I'm also watching XAU 156ish as it's a double top for the Quiet Riot crowd. Yes, I wanna see whether they bang their head.
- Speaking of silver, I picked up some low level chatter last night that the much anticipated ETF may be having some "issues" coming to market. This isn't confirmed, obviously, but as I've been banging the drum on white lightening for over a year, mis oídos son sus oídos. I continue to love energy and metals long-term (it's pretty clear that Boom Boom will over-inflate rather than deflate) but the sharpest corrections occur in the context of a bull market. I'll be a buyer into that nosty slide, if and when, and have no agenda other than to put this potential pin prick on ye radar.
- Consistent with the "secular theme" discussion, Professor Gilmartin pinged me yesterday to discuss my "bearishness" in the energy patch. "I'm not bearish, Brian," I said to him, "I'm bullish lower." There is risk in that approach--true bull markets often don't offer the anticipated dip shticks--but I've reached a point in my career where I wanna be comfy with my risk profile rather than make up for lost ground. As it stands, my exposure to my two "faves" (energy and metal) is at the lowest level in years. That may be right or it may be wrong but, as you know, I'll always be honest.
- While my long (defined risk) puts in the financials felt like an equity enema yesterday, I more than offset that pain with my spate of long-side situations (including SunMicro). I'm uber-conscious of the acne in the banks (BKX) and brokers (XBD)--we flagged the Cliff Branch that Hoofy hung onto Monday--but my paper is of the autumn variety and I wanna keep that gamma on and trade alpha, not delta. Perhaps I should call Mrs. Wormer for some help with my Greeks?
- There's a TON of earnings out this morning and rather than sprain my fingers spewing the dew, I'll link you to the recap over on the Buzz. The net/net? The fundies are "fine" in a vacuum and won't be Boo's catalyst in and of themselves. Alas, we don't live in a vacuum, Mr. Hoover, so we can't defer to any one metric as we ready to steady the information overload. Hoofy will argue that the technicals (above S&P 1295), psychology (buyers are higher) and structural (note the dollar slippage and CRB liftage) also line up and he may be right. We'll see soon enough but I'm not gonna let emotion (fear of missing) dictate my course of action.
- "According to my quote vendor, there is just over 10 times as much volume flowing into advancing issues than declining issues as of now. The old saying is that the most vicious rallies occur in bear markets, and perhaps that's true...one month after the six other occurrences since 1997, the S&P 500 showed an average return of -3.6% with four of the six being negative. Be careful of buying into the hype that is sure to follow such a day." Professor Jason Goepfert on yesterday's Buzz.
And, some not-so-financial-oriented-but-equally-important stuff....
- Some heartfelt white light to Minyan Brian Ducey, who lost his girlfriend Leslie yesterday to a 4 year battle with cancer.
- I tried to dig out some of the upcoming story lines for Entourage but Emm wouldn't unveil the tale. She did tell me that Sloane is one of the primary plot lines this season and water coolers would be buzzin' big time!
- We're in the uber-final stages of the back-end MIM3 testage and the doors may open as soon as today. It's a heckuva line-up and we're not done yet--I've still got my eye on some elephants and we'll be adding to an already impressive roster. The constant feedback we received after Ojai? "You guys didn't charge enough!" Be that as it may, we're not looking to gouge Minyans--it's not our style--we're simply producing an event consistent with the high level of quality that you've come to expect in the 'Ville. From the mountains to the human capital, from the content to ranch parties and from golf to the spa services and softball soiree, this retreat is truly in a class by itself. We sincerely hope you'll be able to join us as we pave the way to our "Sundance of Finance."
Good luck today
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