Fare ye well into the bell!
Love comes to town I'm gonna jump that train
When love comes to town I'm gonna catch that flame
Maybe I was wrong to ever let you down
But I did what I did before love came to town
The snoozy cruise continues to ooze as the critters debate their opposing views. It's quiet enough to hear a bonus drop and while dull tapes have served the bovine purpose this week, we're now looking straight down the barrel of a three day weekend. That adds the specter of "squaring" to the mix and makes an already edgeless tape as sharp as a marble.
I'm gonna be brief on this closing piece because--in my infinite wisdom--I tried to fit all my outstanding meetings into this "slow" week (thereby making it anything but slow). In any event, the net/net of today's fret is a continuation of the recent tug-o-war. Breadth stands out on the big board and that's been the most bullish thread throughout the minxy spread. I've been eyeing the BKX 98/SOX 484 dualopoly as the next resistance but you can equally view the spew the other way by using previous resistance (S&P 1108/NDX 1440/BKX 95) as newfound support. Capice?
It seems to me that a whole lotta folks have already conceded the next upside move. The bulls have been vindicated, previous bears have converted and most technicians have given the Minx a gold star. There is a fine line between using prices to your advantage and fighting the tape and I think most of us are debating that very issue. THE question, quite simply, is whether the mo'mo'go'go' mindset is back and higher prices bring out the buyers. If not, this recent rally is offerin' the out to all those who were choking on exposure last week. The easiest litmus test is a quick self-quiz: Am I balanced enough to buy lower/sell higher and what does my P&L look like up or down X%?
I've been loose on the handlebars lately and pickin' my spots on both sides. I scaled out of my silver (for reasons previously mentioned) and partially nibbled on some defined risk puts in select financials (as we edge towards resistance). I've made a conscious effort to be a bit lighter during the days surrounding the holiday due to the sporadic nature of the tape. And if I miss opportunities, I'll remind myself that they're a lot easier to make up than losses.
I'll swing by tomorrow for a mornin' Randoms and then take back-to-back lunch meetings before hittin' the eject button. We all have a lot to be thankful for and it's easy to lose sight of that while looking for the next best trade. The balance, in my eyes, is staying focused and maintaining the intensity while allowing yourself to enjoy life and the world around you. It's easier said than done--that's for sure--but it's likely the most profitable trade that we can ever hope to make.
Have a peaceful night.
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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