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The Train Stain


Trade to win... never trade "not to lose"


Gotta get to Tulsa
First train we can ride
Got to settle one old score
And one small point of pride

(Grateful Dead)

It's a busy morning in Minyanville as the critters digest a plethora of data and the early pressure is on the sell-side.

The dollar continues it's monopoly peg quest as it's reversed almost a full percent (lower) in pre-market trading. Same store sales were mixed, meanwhile, with Wal-Mart (WMT:NYSE), Kohl's (KSS:NYSE) and May Stores (MAY:NYSE) below plan while Target (TGT:NYSE) and Gap (GPS:NYSE) seemed better. On the research front, Goldman Sachs reports that their mid-April IT spending survey indicated another leg down in 2003 spending intentions. The firm had expected to see signs of stabilization and instead saw the single largest move (lower) in their survey series. Finally, Europe is getting smoked like a Philly blunt at a Snoop Dogg concert.

We often discuss how bad news (that's not a disaster) is bullish in oversold tapes and good news (that's not great) is bearish in extended tapes. It could be argued that these latest data points (the tech spending survey and the aggregate retail sales data) are flat out NEGATIVE in an extended tape. If the war was the reason for "holding back," shouldn't there been discernable signs of an uptick? Just something to make you go "hmm" as we prepare to start our day.

The tale of the tape will be told by the willingness of traders to buy weakness. S&P 925 was trendline support (from the March lows) and, as we've breached it, all eyes will be on S&P 905. It's funny (not funny like a clown, but funny nonetheless) everybody and their gerbil wants to buy that level and conventional wisdom dictates that we'll pull back and zoom ahead. It's possible -- emotion and momentum make for a potent (toxic?) combination -- but let's worry about that when it arrives.

Keep an eye on the financials (particularly the brokers and BKX 800), Cisco (CSCO:Nasdaq) (sentiment), the retailers (reaction to numbers), the dollar (when does it matter?), breadth (internal health), the generals (General Motors (GM:NYSE) and General Electric (GE:NYSE)), semicaps and our levels. And please take a deep breath -- emotion remains the enemy while trading.

I enter the day with both legs in my metaphorical bear costume (50% conviction on the short side) and I wanna see how they act. It's been a long haul for Boo and I told him that the way to chip out of the woods is with a wedge, not a driver. Baby steps, Mon Bear, and you'll find Mr. Mojo rising.

Kick some arse.

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positions in spx, wmt, csco, gm, ge

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

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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