Good luck Minyans!
Good morning and welcome back to the black jack. We saddle up to this morning's table with a few chips and a coupleof questions. Should those with nice profits take another card or stick with the good fortune bestowed upon them by the casino? Are the dealers pressing their bets with their continual upgrades after the fact? Are you feeling lucky today and, more importantly, how do you know when to walk away? Shuffle in and settle down, Minyans, for a new hand is about to be dealt.
Friday's baby bounce brought the markets back above the much discussed breakout support (S&P 1015). It wasn't much on absolute terms but it was a gritty showing by the brazen bulls. There's been a lot of discussion regarding the legitimacy of the (summer) range breakout and whether it was the final carrot to the quarter horse. By staving off Boo's barrage, Hoofy once again staked his claim as the critter of the year.
These next two weeks promise to be a tad crafty. With September expiration looming on Friday (and quarter end soon thereafter), there's gonna be a lotta crosscurrents floating around. It's a bit early to call whether they'll swell into green seas--or a crimson tide--but one thing is for certain. Emotions are high, the stakes are large and reputations are at stake. Somebody is gonna feel like money, baby, and someone's gonna be lickin' their wounds.
The best analogy I can use when describing this market is that it's a high stakes game of musical chairs. As we've discussed recently, the conditional elements are in place for a pretty nasty downside disconnect. Whether "it" happens or not depends on a lot of variable factors and, until "it" does, the legitimacy of such a notion is growing increasingly absurd. As a matter of fact, according to Yale's monthly investor survey, "crash-spotters" are at the lowest level since...anyone?....anyone?....October 1987.
That's not necessarily gameable--just ask all the folks who were convinced that dollar averaging was the way to go these last few years. While it's possible to nail the direction or the timing in this business, one does you no good without the other. As such, the disciplines employed and the respect warranted are hallmarks of successful money management. It's a long game, Minyans, so don't bet all your chips on a single hand.
For today's tape, our levels remain much the same although it appears that the triple-lindy resistance (NDX 1355) may soon be rear-view. The next discernable ceiling comes into play in the high 1380s, which were the September (and yearly) highs. On the downside, NDX 1330 is a decent first support zone. On the big board, S&P 1020 (previous support/current resistance) is hump #1 while the September (yearly) highs reside in and around S&P 1030. S&P 1010ish and the G-Spot are still support.
In Minyanville news, we're less than two months away from the first annual Critters Choice Awards. Tickets have yet to go on sale, but you can be the first to hold tickets to the November 12 musical benefit by participating in the super kewl animated auction. In addition to arrivin' in style and mingling among luminaries from the film, finance and musical industries (including your very own Minyanville professors), you'll also star alongside your favorite critters in the first ever Minyanville animated trailer! Minyan Neal Greenberg currently sits atop the leader board but there's still time to play. The auction will close at noon Friday with the net proceeds to benefit the Ruby Peck Foundation for Children's Education! Wasabi!
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.
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