Running with Ruprecht
The ability not to trade is often as important as trading ability.
"A poacher who shoots at rabbits may scare big game away."
-Lawrence Jamieson, Dirty Rotten Scoundrels
And so it is. The Republican National Convention is in full swing, the masses are migrating towards the music and the Minx is starting to get feisty. It hasn't been a banner year for most managers and those who chose to duke it out share the singular focus of performance enhancement. That pressy stress--combined with the whisper thin conditions--makes for a most interesting dynamic. As we edge ever-so-closer to our requisite three-day respite, those freaky footsteps will echo loudly though the barren canyons.
While Boo can be heard mumbling something about a "hand stand" into Dubya's big day, the pragmatist will argue that the macro landscape is reason enough for the cause celebre. The crude crunch, while still a threat, has been downgraded from DEFCON status and eliminated the backstop for many of the newfound cubs . And while there's a latent discontent with our electoral options, it seems that clarity has begun to emerge as Dubya steps forward.
Will that be enough to spur the herd to heights absurd? Perhaps, but caveats remain in virtually every metric. Twisty stochastics (coupled with tranched resistance and pronounced downtrends) hamper the technicals, back-end loaded quarters plague the fundies, eye-popping complacency clouds the psychology and our structural bones are bound with Band-Aids. In short, there are plenty of reasons to skip to Red Dye but they must fend off a concerted effort by the proud Matador crowd.
The script will be edited by a handful of catalysts in the days ahead. The ISM manufacturing index (exp. 60, prices paid 79) and auto sales (both released today) will help shape the perception of whether the economic soft patch is as transitory as they say. The Mother Chip (INTC:NASD) (tomorrow) will serve as a proxy for big cap tech fundamentals and whether they're "tracking" up to snuff. Friday's employment data will be a spark in the dark as the tumbleweeds through the Street. And, of course, no news may be the biggest news if the RNC goes off without a hitch (on the heels of the Athens Olympics).
The key to the vault remains nestled in the daily dance. Throughout yesterday's stress test, Snapper was anxiously eyeing the firm financials and wire-to-wire positive S&P breadth. It may sound simplistic but our goal is to line up as many ducks as possible (before risk initiation) and these two elements were quacking loudly. I'm gonna maintain my focus on our mainstay tells while monitoring the impact of flow, news, levels and rotation. Further, I plan to utilize trailing stops in my approach as that will provide me with the most advantageous risk/reward.
I'm gonna hop over to the Buzz but before I go, I wanted to again thank ye faithful for their continued support. I was having dinner last night with a "big fish" and told him how humbled I was to be surrounded by such talent and supported by so many. Minyanville is a special place and the vibe seems to be spreading with each passing day. We want to be a positive experience for all involved so if you have any thoughts, ideas, constructive criticism or suggestions, please don't hesitate to share them. The critters, if nothing else, aim to please.
Good luck today.
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.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Daily Recap Newsletter