Muck and Mire
Fare ye well and keep your head up!
In the backwash of Fennario
The black and bloody mire
The Dire Wolf collects his due
while the boys sing round the fire
The crimson tide is on a ride and the bears are beginning to pound some paw prints. As of this post, Hoofy has lost his technical toe hold and his friends are a bit concerned. The bunk banks, broke brokers and soft SOX are paving the way to further fray and if our bovine wants to climb, he'll have to establish traction in some of those sectors.
You always wanna give chart levels a little wiggle room and most will likely focus on the closing levels. As it stands, S&P 1015 and NDX 1350 look like star dust and that's gonna raise some technical eyebrows. On the fundie front, Texas Instruments (TXN:NYSE) and Nokia (NOK:NYSE) offered recent cause for paws and structurally, we've begun to see some cracks in the mortgage foundation. Indeed, it appears as if "refi-mania" has morphed into "refi-painia" as the effects of higher rates start to trickle through the system.
The rally of '03 has been littered with one day head fakes and that fact is not lost on the bears. With BKX 850 within spittin' distance, however, Boo needs some follow-through for ursine glue. It's not gonna be easy--there are a lotta agendas in play--but if (big if) he can break the financials, it'll grease the wheels for a slippery slope.
Will the cries of wolf finally find an actionable audience? It may be too soon to pen the equity epitaph but the conditional elements are certainly there. The bull camp is uber-crowded and most everyone you see, hear or smell is of the belief that a robust economic recovery is a given. That's been the self-fulfilling rally cry all year and, as such, the only perceived risk is not being invested. I can't tell you with certainty that NOW is the time it will finally matter--but I still feel that it's a matter of time.
I know tomorrow is going to be a difficult day for many of us and, as such, I would like to remind you to remove emotion from your decision making process. These last two years have been extremely tough and I'm not even talking about the market. As we battle the flickering ticks, I'll remind you that the only positive to come out of September 11 was the perspective to understand what truly matters in life. It's sometimes easy to forget but it's never too late to start remembering.
Have a peaceful night.
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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