The trading wires are jumpin' with news of the 10:30 Dubya news conference
You say, you want
Diamonds on a ring of gold
Your story to remain untold
Your love not to grow cold
Alright, now that I've got that goofy rhyme thing out of my system, it's time to put our serious hats on and look at what's what. An old friend of mine (no, not you Neil) once said that a little levity goes a long way--and I assume he wasn't referring to the levitation migration engineered by Elmer & Co.! Smiles are good, no matter how you slice 'em, so please understand that there's a method to the madness.
Whenever you have a love/hate/love/hate market--all in the same session--it's bound to make Ms. Lizzy dizzy. One minute , the Minx looked poised for flight with her wings spread bright. The next, it appeared as if she was about to get smeared. I'll say this--these spinning wheels are either gonna gain traction and race out of the muck or spit mud into the faces of the equity chasers.
Today's one of the quieter days in recent weeks and that'll leave the Minx up to her own devices. We're still very much range bound in the S&P and, as it stands, the NDX trendline (from the March low) lurks below at NDX 1265ish. Those are the levels that everybody and their sister is watching so be forewarned, when we break out of this range (either way), there will be a mad dash to chase (raise) cash. Also be aware of the potential for a false signal (when this many people are staring at the same chart).
Overnight, the Jinx was off a deuce and Europe is flattish. Keep half an eye on the bonds today as the meltage has implications for equity land. Talking to my buddy Fleck last night, we discussed the viciousness of the fixed income move and the potential that stocks may face a similar fate. The test, we agreed, will be when bonds have their inevitable bounce. Will Hoofy use that excuse for further ursine abuse?
I've gotta hop and run into a morning meeting. Remember, strategy is our strength (and not disaster) so map out a game plan and remain adaptive. These choppy and sloppy markets can cause a death by 1000 paper cuts, so don't overtrade as you search for that elusive edge. It's out there...and patience will typically bring price.
Fare ye 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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