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South Side Story


May peace be with you!


The storyteller makes no choice
Soon you will not hear his voice
His job is to shed light
And not to master

(Grateful Dead)

The afternoon tape is starting to scrape as the bovine look for an escape. We were hummin' along nicely and digesting the sloppy semis when--out of the blue--crude spiked over 3%. I'm diggin' for information but other than the requisite pipeline chatter (terror concerns), I've dug a dry hole of my own. Regardless, the poor camel that is this market doesn't need many more straws on her back!

The story of the day is the 10% haircut in Intel (INTC:NASD) and the anchors that are the semis. I opined yesterday that there was too much focus on the mother chip and one stock does not a market make. I obviously underestimated the influence of this bellwether (mea culpa) but the shabby news, on top of KLAC's back, has spilled the beans. And while i can't confirm that there is "forced selling" (liquidation) in the group, it's pretty clear that they're under distribution (25% off January's high).

Hoofy will counter that the tape acts tremendous given the high heat and, I suppose, the bull has a point. The risk to that argument (buying 'em because they act well) is that the only way you know if you've lost your catalyst is when the tape has already belched. I'm not saying he's wrong, I'm just urging him to apply a methodology that defines his risk. The dip shtick isn't gonna stick one day and when that happens, we'll finally see fear that isn't related to missing the upside.

Beeks will serve up the PPI tomorrow along with a truck full of earnings. While we're certainly due for a Snapper, there are enough broken charts and hoping hearts to justify continued lethargy. I may not be offering the directional vibe some are looking for but I can only offer what I see, feel and hear. The market trades confused and reactive and that, coupled with Friday's expiry, makes this one of the tougher junctures to judge.

I'm gonna hop to the Buzz before hitting the eject button before the bell (midtown meeting). I sincerely hope that you're all finding your way and maintaining perspective (easier said than done). A special thanks to ye faithful who took the time to help out one of our own. There are a lot of good Minyans out there and as long as we stick together, we'll find our way through this fray. Together.

Fare ye well into the bell.

position in klac
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