Buzz Bits: Dow, Nasdaq Close in the Green
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Bell Buzz - Todd Harrison - 3:39 PM
I'll tell ya, blink and ya missed it....with "it" being applicable to any number of things today. "It" could be time, as the trading day suddenly eyes the closing bell. "It" could be opportunities, as the bovine lament and the ursine repent. "It" could be Mackemania running wild but alas, that's a visual best kept to itself.
Indeed, the common thread today, from bulls and bears alike, is....Remorse. Nobody seems happy with the jingle in their jeans, which brings back memories of yore. Performance anxiety? Fear of missing? Bigger better things? Yep, although that isn't, in and of itself, evil. Fear and greed have long been the dominant drivers of all things financial.
While I've been wrong as a song in September (hand raised, no hiding, this is me taking my medicine), this scenario was mapped as a potential play. Unfortunately, as it stands, the "broader upside migration" hasn't been paced by an out-performance of energy and metals, which is what I was--and am--betting on. I'm still there and I've been trading around those cores to the best of my ability.
I will simply offer this, Minyans, and old school ballers know I shoot 'em straight. We'll be right at times, and we'll be wrong at times--that's just a part of the game. Discipline, however, must be the common denomanator regardless of posture. With the VXO off a quick nine percent and the technicians (and media) about to scream "all clear," I would spend a bit less time bummin' about what was and focus on what will potentially be. Profits--and possibilities--will be fresh and abundant when we power up anew.
Fare ye well into the bell and have a profitable night.
Position in financials, energy, metals
Crude Oil's plunging trendline just met a cold snap. - Rod David - 2:40 PM
Crude Oil gapped down Monday to new lows. Despite extending slightly lower through mid-morning, the overnight lows weren't touched before a recovery filled the open's gap at noon. Then a funny thing happened AFTER noon - price surged.
The peak so far was at least a dime under levels that would stop out our nine-week old short position. But the short position appears to be living on borrowed time.
Each of the prior three sessions through Friday had printed new lows intraday. Monday is on-track to close back above all of those prior lows. This setup tends to identify a significant bottom, and with the exception of a potential retest of Monday's opening low, sellers have lost traction, which buyers are starting to gain.
Commodity Oddities - Kevin Depew - 1:53 PM
- The Sugar selloff gathered still more pace today as March peeled off another 4.5% into the close.
- How low can we go? The break of the 12.20 level caused still more technical damage and the initial downside objective is 9.20.
- Pru cut their price target for Archer Daniels Midland (ADM) based on sagging ethanol prices that their analyst said may impact earnings for FY2008.
- Meanwhile, Corn (basis December) has rallied to test trendline resistance in the 256 area.
- Minyan LT asked where he could find the Baltic Dry Index online. Try this site.
Gold Digger - Adam Warner - 11:10 AM
Want a stock vs. commodity relationship that is noteworthy? Newmont (NEM) is as *cheap* as it has been vs. gold in two years.
NEM is also right at key support from about 11 months back. All of which would suggest that volatility might pop a bit. Then I remembered a volatility pop on a scary chart right at support is such a *yesterday* concept. The options change hands at a 33 clip or so across the board, a level from which they were cheaper only about a third of the time over the past year.
Yes, you can smell the fear.
Position in NEM
Morning hatchet job - Fil Zucchi - 10:57 AM
- Pepe has already summarized the lowlights of the existing housing numbers in his must read "5 Things." If you want all the gory details you can go to the source here. Nevermind that the Fed's Fisher this morning described the housing market as being in a "serious correction," the NAR mouthpieces tell us it's all good. Stay tuned for CNN breaking news on my hair growing back.
- As a point of reference, there are approximately 200k existing condos for sale in the South region, and something like 50k-70k new ones scheduled for delivery next year . . . in Miami.
- "Stumpy" is buying individual small cap energy names against a spate of Oil Services Holdr (OIH) puts. So far "Stumpy" is living up to his name.
Position in OIH
Is there a mean reverting bounce in energy on the horizon? - Bennet Sedacca - 9:43 AM
Well in a nutshell, my firm thinks yes. Although it would likely be a bounce in the context of a larger downtrend, it could be sharp and of decent in size. Keep in mind, Minyans, that bounces in bear trends can be fast and furious, particularly in commodities.
Why do I feel this way? First, see the chart here, courtesy of Ned Davis Research. We are at a point where good bottoms - sometimes short-term, sometimes long-term - have been put in, strictly in terms of sentiment.
Secondly, I would note a sharp reduction in the percentage of ownership in equity assets as a percentage of total assets as it relates to Fidelity Select funds. While my firm hasn't yet taken a stab, we are close and it is squarely on our radar as funds dump for quarter end window dressing.
What you need to know... - Jon Doctor J Najarian - 8:16 AM
Crude Breaks $60 - Front-month crude-oil futures went through $60 a barrel on the NYMEX, and show futures trading $59.68 down $0.87. Rumors of OBL being dead are adding to pressure on the energy sector, as is the end of quarter selling.
Hewlett-Packard's (HPQ) Hurd Apologizes, Dunn Done – Mark Hurd, taking a page from Bill Clinton's playbook, said he authorized spying on board members and journalists, but didn't actually "read" the reports. Hmmm. Meanwhile, Patricia Dunn is truly done, stepping down now rather than waiting until January.
Sony (SNE) Cutting PS3 Price 20% - How do you hold onto your core buyers when you may have to yet again delay the PS3? Sony thinks a 20% price cut will do the trick. They'd better be ready for Christmas, or it's sayonara.
SanDisk (SNDK) Downgrade by Merrill – ML cited the risk of a sharp correction in memory prices and downgraded the memory card maker to neutral from buy. ML added recent visits with Asian memory manufacturers suggest that supply will likely run ahead of demand over the next six to nine months, which could lead to severe price erosion.
Position in HPQ
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