Boogie Down Productions
By Todd Harrison Aug 02, 2004 3:33 pm
Hooray for Hollywood!
Spent a little time on the mountain
Spent a little time on the hill
Heard some say better run away
Others say you better stand still
The earlier lift was a green bovine gift that caused a few bears to uncomfortably shift. We were discussing a simplistic approach to today's trading over on the Buzz. Citigroup (C:NYSE) was in the eye of the terror-able storm and, as it was already 'the most important stock in the world,' we figured that it would lead by example. Sure 'nuff, it opened fifty cents lower, crawled up the hill (with alotta piggies on her back) and has led the Minx back to Matador City.
We've now arrived at a juncture where alotta traders will either fish or cut bait. S&P 1107, the vaunted 200-day moving average, is lurking directly above and calling the bulls out. While the action thus far is constructive, we should note that the oversold tape (if you can call it that) is becoming less so and complacency abounds. In fact, the mere fact that the VXO (volatility index) is down 3% on the heels of a terror warning is borderline scary.
Still, it won't matter until it does and the bears are back fighting the invisible hand. What do I mean? For the better part of '03, the structural metric provided ample liquidity and washed away the global worries. Hoofy came to depend on the intangible elements and old habits are hard to break. That indifference became clear during this most recent retest of the '04 lows when volatility and sentiment indices barely budged.
There's a fair amount on the trading radar so I will urge ye faithful to stay on top of their game. It is, after all, August and that means thin tapes and skeletal crews. Make smart decisions that'll allow you to sleep at night but, by all means, don't trade scared (the easiest way to lose money is when you're trading not to lose). And if you've got some free time on your hands, please give the Minyans in the Mountains a good, hard look (it's only 17 days away!). We always urge Minyans to work to live rather than living to work but if you can accomplish both at the same time.....wasabi!
I'll be traveling for the next few days and will be back by the opening on Thursday. Fare ye well, my friends, and please remember that the purpose of the journey is the journey itself.
May peace be with you.
position in c
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