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Morning Flickness


May peace be with you!


Till the morning comes, it'll do you fine.
Till the morning comes, like a highway sign,
Showing you the way, leaving no doubt,
Of the way on in or the way back out.

(Grateful Dead)

It's another snoozy cruise in the house of bruise and the critters continue their search for clues. Imagine my surprise when, out of nowhere, the door flew open and the menagerie filed into my office. After a quick nod to Fokker (wzubpt!), they surrounded my desk and smiled en masse. I should have known I was in trouble right then and there.

Boo: Ya know, I thought you, ya know, did a good job today. It can't, ya know, be easy to have such a variant big picture view.

Toddo: Dude, you're the last one I expect to take schvitz from--I was standing up for you!

Hoofy: I think you went into the wrong make-up room. After all, they forget the big red nose, orange hair and floppy shoes!

Daisy: Seriously Toddo, how could you?

Toddo: Listen guys, I offered an honest assessment and, as always, it was just my humble opinion. The media seems so intent on putting a bullish spin on the world and I just don't see it. Doesn't mean I'm right and even if I am, it doesn't mean we can't see another leg higher before it plays out. I simply wanted to present the other side of the coin for those who wanna keep an open mind.

Snapper: Sounds pretty hedgy to me.

Toddo: Not really, bro, you know how I'm playing this juncture. It's been slow and I don't wanna trade just for the sake of trading. The upside of these tight technicals is that they offer very defined risk parameters. We know the G-Spot in the S&P (smiles at Daisy) and "Pepe" Depew already pointed out the looming level for the semis. Between the two, we should get a good feel for the next nuance.

Sammy: But everyone's staring at the same levels, Toddo. Doesn't that make a "head fake" all the more dangerous?

Toddo: To a degree. Active traders will tell you that trendlines and historical guides have lost some of their predictive mojo. That's why I've taken half a step back and loosened the grip on the handlebars. I haven't discarded my tools, I've simply adapted to the environment and appreciate the juncture.

Boo: (getting frustrated) Stop being so political. I saw you biting your tongue this morning. You were about to unleash the hounds on Elmer--I saw it--there was a moment when you and Rick locked eyes. It was like the scene in A Few Good Men when Lt. Kaffee had Col. Nathan R. Jessup on the stand. You were about to go there and punked out!

Toddo: There was no need. I think I said my piece and there was no reason to give Rick a reason to throw another curve. Man, with friends like that...

Hoofy: Aw, it was just a love tap. You wanna play in the bigs, you gotta pay your dues.

Daisy: I think slick Rick shoulda taken the gloves off. The nerve of you Toddo! Insulting this great nation of ours!

Toddo: (sigh) Come on now, I did no such thing.

Sammy (slithering between us) F-O-C-U-S! We've got Dell Computer (DELL:NASD) earnings tonight and the double-E tomorrow (expiration and economics). Monsieur Beeks will swing by for breakfast and release the Pee Pee Eye (exp. .2%, ex chow & energy .1%), the Empire State Manufacturing number (exp. 20), Industrial Production (exp. .2%), Capacity Utilization (exp. 74.4%) and the Wolverine Confidence (exp. 91.4). I know it's slow, but it's important to remain lucid.

Toddo: I'll say this much, with the levels getting tighter and tighter, something's gonna give soon. As Brian has been saying, the level of risk is increasing on both sides of the fence. If you can't identify an edge, don't coin toss. I'm still in the fade (read: sell) rallies mode but I've bought some one day upside insurance in the form of at-the-money calls. That allows me to keep my downsides on into the great unknown without spending much money.

Daisy: (walks over and sits on Toddo's lap) Wanna kiss and make up? I've been practicing my singing skills, ya know, and I'm jazzed to strut my stuff on November 12. When are you gonna tell 'em about the talent? There's so much more to this than they know!

Toddo: One step at a time, Daisy, one step at a time. The Critters Choice Awards site is up and the Minyans should continue to check it for updates. In the meantime, we've got a Minx to trade and we need to keep our eye on the ball. If you'll excuse me, I've gotta manicure some risk.

Daisy jumped up and joined the other critters as they made their way to the door. They were excited about the event but understood that there's a time for work and a time for play. As Fokker stared at Daisy's milkshake, I perused the price action and dug in my heels. I knew that, if nothing else, the games were set to begin.

Have a peaceful night.
position in spx

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

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