A Critter Concert
By Todd Harrison Aug 07, 2003 8:31 am
Today sure is a big day!
Good morning and welcome back to the giggly wiggles. After yesterday's untimely power outage, the menagerie was itchin' for some old school fun and, as the sun set over the city of critters, the fantastic five crept to their favorite dive. Nestled in their usual booth at the Birdland, they munched on some schnitzel and awaited the snazzy jazz. Before long, the conversation turned to the tape and a nearby waiter overheard the following conversation:
Daisy: I'll tell ya, this tape has more swings than Robin Byrd! It's absolutely nuts!
Boo: (sucking down a margarita) Speaking of nuts, somebody's gonna get roasted soon and, just in case anyone's taking orders, I like my steak well done (winks at Daisy).
Hoofy: She's well done, Boo, and in all the right places (sighs). If you're trying to make a backhanded market analogy, however, I'm afraid you're sniffing up the wrong tree. Heck, the way you've been trading, you might be sniffin' glue!
Boo: I get it...Elmer...glue...that's pretty witty, Hoofs. But before you start your daily end zone dance, let's go to the video tape. While the recent action has been choppy, yesterday's close was fairly sloppy. Trend changes--if, in fact, that's what we're seeing--don't happen overnight. It's a process, and if you stopped gawking at your Dairy diva for a second, you'd notice that the S&P has now put in six lower tops since the June bloom and the NDX trendline has been vaporized.
Snapper: You're right--there have been some disturbing developments. But if you only focus on the left side of the street, you're gonna miss half the traffic. Snoop made some astute and open-minded observations yesterday that should be read by every critter. Even if you're uber-bearish and pressing these recent breaks, you always want to see both sides of every trade.
Hoofy: Yeah dude, every time the market takes a half step back, you start trumpeting the demise of the world as we know it. There are new shorts in the market, certain stochastics (BKX, Microsoft (MSFT:NASD) look ready to "hook up," firmer bonds could buoy sentiment, S&P 965 has held (don't blink) and the Dow Jones is at the lower end of the range. A little fear is healthy, boss, and if the Minx is gonna make a run at new highs, there has to be doubters out there.
Sammy: You're right, Hoofs, but, to be fair, a lot of those stochastics pretzel twisted on the other side of the field (when the market was ripping). Boo has a point when he notes the technical breaks and, although technicals aren't absolute, they must be respected.
Boo: Come on Sammy, you know how the game works. Everyone's bullish as the market rallies and they'll turn negative after a serious decline. Do you know how many investors prayed for a market rally (when we were in the dregs) so they could reduce exposure....only to turn buyer after a hard lift? I'm not poking fun at anybody, I simply want to provide a little perspective in the context of market gyrations. When the S&P has a six handle on it, these same folks are gonna turn seller.
Daisy: Why are you such a sour puss?
Boo: Uhh....because I'm a bear? And I'd rather be a sour puss than have sour milk! (smiles--but nobody else does) Listen, in all seriousness, I see the things Hoofy is pointing to and I'm aware that he's gonna make a stand at S&P 950 (if and when). The reality is, there are too many bulls out there who's only fear is missing the upside. Meanwhile, the perpetual second half recovery is Casper, the internals have started to grow hair, tech insiders are dumping stocks en masse, there's a chunk of downside negative gamma and, lest we forget, we've got the Fannie Mae (FNM:NYSE)/housing bubble chicken/egg thing going! Look on the bright side, Hoofy, you can always run for governor of California!
Hoofy:Just be careful, Boo, 'cause Minyanville wouldn't be the same without you. I know we agree to disagree, but I'm genuinely concerned about you. I mean, heck, you make John Nash look lucid!
Boo: Yeah, everyone thought he was nuts too...until he won the Nobel prize! Time will tell, my friend, time will tell. My only message is to appreciate the minority view--for when it morphs into the majority, chances are it'll be too late to act.
The lights in the main room dimmed and the musicians began to emerge on stage. Snapper jumped up, weaved his way towards his sax and started to tune the brass beast. There would be plenty of time to sing the minxy rhyme but, for now, they were feasting among friends. They knew to appreciate every moment for, as we've learned, they can disappear. Just like that.
Good luck today.
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