The air is thinner here than in Colorado!
You can't start a fire
You can't start a fire without a spark
This gun's for hire
Even if we're just dancing in the dark
The opening bell tolls and the leftover fireworks have been ignited en masse. The initial sparkler is impressive--the gains are broad based, the leadership sectors are robust, breadth is minty and Fokker's new graphic is astounding! The caveat? The week is forty-five minutes old, cookie, and it seems as if a buncha traders were caught short heading into the weekend. Once they cover, and many are doing so now, we should get a truer sense of the underlying demand.
S&P 1000 is a natural level of psychological congestion but the June highs represent more of a technical challenge. We're tickling that zone now in the NDX and if (big if) we push through, some "stop orders" will likely get elected. Please remember that IF that happens, there will likely be a quick air pocket (higher) before things settle back. We (you) saw that last week when the S&P (briefly) ticked below the head and shoulder neckline. There was an gasp lower before a rush higher. Stay on ze toes, please, as everyone seems to be watching the same levels.
The home builders, energy and gold issues are lagging, software and drugs are attempting to blow off this morning's misses and most everything else is (thus far) digesting this spirited sprint. I've seen some macro funds buying ETF's all morning. As it stands, we're still "range bound" (from June) but Hoofy is sniffin' the upper band tag.
I'll be back.
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 firstname.lastname@example.org.
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