Think positive and kick some arse into the close!
A love struck Hoofy sings a streets a serenade
Laying everybody low with a love song that he made
Finds a streetlight, steps out of the shade
Says something like, you and me babe, how about it?
It's been a hairy month for yours truly and in an attempt to ground myself, I went for a long run last night in Central Park. It was a gorgeous afternoon as entered the Manhattan oasis and I figured the gods were smiling on me when I tuned in to 104.3 and caught "Jack Straw" (Nassau Coliseum) on live at five. Little things like that put a smile on my face and as I ran -- and reflected -- my active keppe took a breather.
Sometimes when you look at something with such intensity, the lines of distinction tend to blur. I was attempting to chop down the Minxy trees and, all the while, there was a party in the forest. I'm not looking back (that's wasted energy) but this is a forum for sharing and if you can learn from my mistakes -- if WE can learn from them -- they'll morph into valuable lessons.
My thesis remains intact -- I believe this action is textbook bear market rally material (destined for failure) -- but my stylistic approach didn't factor in the self-fulfilling hope that springs eternal. I've got no problem with my scaling into out-of-the-money puts (it was and is consistent with my thought process) but perhaps I should have been more aggressive with identifying relative longs vs. absolute shorts. Stock picking (and sector rotation) is a critical element of successful trading and will remain so as we dance ahead.
In any event, we're approaching (yet another) crossroads, and the beauty of this business is that we're afforded opportunities on a daily basis. Until proven otherwise, this will be viewed as a healthy pullback in a bullish phase. When (if ever) will the dollar...or deflation chatter... or complacency... or the crowded long side... or the reality that the economy is no great shakes... matter? When the market is lower, that's when.
When we were kicking around the Shim Sham thesis in March, I was looking for one final whoosh lower before loading the boat for the ride higher. I am conscious of the mirror image similarities here and, as such, have been "trading around" my June puts. Should we get the blow-off higher, I want to scale into more of these bad boys. If we don't, I want to be represented in kind. YOUR risk profile and time horizon is unique and YOU must decide how to approach a cheesy squeezy should it occur. Our goal at Minyanville is to offer food for thought and cookies for dessert.
A handful of tertiary names report after the bell and tomorrow is a quiet day on the catalyst front. As such, psychology and technicals will likely be the trading metrics of choice. S&P 920ish and NDX 1120 (there now) are trendlines and the Minx is attempting to make a stand. Outside of that, BKX 800 is in the red but remains within spit up distance for a Snapper trapper (if and when).
Barring any major moves into the close, I'm likely gonna keep both legs in my fur and adhere to my stated strategy. I've rotated some risk intraday and used the slippage to make some disciplined picks but, for the most part, I'm on autopilot. I'm attempting to relieve some of the intense (self-imposed) pressure while maintaining the eye of the tiger focus. It's a thin line and I'm not sure I've identified it yet but I know it's out there, Mon Frere.
I'm gonna juggle my hats and jiggle some risk so I'm gonna leave you here. I can't tell you how much I appreciate the good vibes being sent our way from our readership and, on my word, we'll always try to make you proud. I'm particularly touched by the response to last weekend's Full Circle piece as I wasn't quite sure how it would be received. I know one thing, my friends -- there are a lot of good Minyans in our midst.
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 email@example.com.
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