When's the last time that everyone was right?
The lunch munch continues as the Minx grinds to the daily highs and I've spend the last half hour making calls to my coverage. You wanna hear a consensus? Every single person I spoke with said they don't think Elmer matters. No cut? Bullish. Cut? Bullish. Hopscotch? Bullish. I see the action, my friends, and in many ways, it's consistent with the "blow off" thesis. I just wanted to pass along the unanimous consensus (which is rarely right).
Why, you ask, would I slip one leg into the fur at S&P 930 if I can "see" a final push to S&P 950ish and NDX 1200ish? Because the style I've chosen to employ dictates scaling into these June puts and, while I'm renting some intraday longs (with tight stops), I want to keep half a cheek on the seat when the Minxy musical chairs stop. In my mind's eye, the 'easy' portion of the rally already occurred and while I surely didn't trade it to perfection, I don't want to exacerbate the problem by chasing 'em now.
A snapshot of the action -- which is to be taken with a grain of salt ahead of the Fed -- is more of the same. The breadth is healthy, the semis have found sponsorship, we've (marginally) taken out yesterday's highs and the financials held where they had to. Perhaps that's why I'm seeing multiple seven figures to buy in QQQ and SPY on a cover. The shorts have, for the most part, reached the point of maximum pain.
These are emotional times and I urge you to take a deep breath and long look at your risk (both ways). Over the course of the next few hours, the schvitz will hit the proverbial fan and the action will pick up in size. Map out a strategy and trade to win, Minyans. This is steely nerve time and you'll need to be at your very best.
As always, I hope this finds you 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 email@example.com.
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