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Random Thoughts: Eye on Technical Levels


S&P 1405 could be an important toggle.

  • The disparity between credit markets and stock markets continues, with virtually everyone and their second cousin watching S&P 1405 as a toggle. The ability to hold that level with any type of consistency is paramount to the bovine case.

  • Through pure eyes, FedEx (FDX) (up on the day) and AIG (AIG) (holding $40)--not to mention 2:1 positive breadth--are Cliff Branches in today's tape.* And yes, that asterisk is a function of the light volume under aforementioned technical levels.

  • What to do? My best thought remains "long vol," or positive gamma, through individual names (as opposed to VIX options). I must again offer the caveat that unless you're well versed in the risks associated with options, you should tread uber-carefully.

  • The kinda cool part of the morning TV hit? They're teeing up a Random Thought each day, which will vary as my thoughts tend to. "Give us a stream of consciousness," they said. "Be careful for what you wish," I countered. Indeed, the Terence Trent D'Arby muse isn't something that is often discussed on financial television.

  • Are Blackberry's the new i-Phone? With Research in Motion (RIMM) up 160% since last summer, it may be safer to say that it's the old Apple (AAPL) (with a conscious nod to the acne above $140).

  • Wal-Mart (WMT) will shape tomorrow's tape as, according to Professor Reamer, it's the new consumer proxy. $59 i s the level of lore although, again, technicals are often a better context than catalyst.

  • So, at my cousin Stephanie's wedding Saturday night, after the guitar player finished his snazzy rendition of Hey Jude, my brother and I started the "Na, na na na na na nah..." chorus and continued until 300 people joined in (arms waving in the air). We were laughing so hard that tears were streaming down our faces, which was particularly sweet as I watched my grandmother Dorothy sing and smile (and wave her arms) across the table.

  • S&P 1405. S&P 1405. S&P 1405. And you thought technicals didn't matter? So it's said, there is a decent shot that they're self-fulfilling and work simply because so many traders are watching them. But that's a conversation for another time.

  • Three parting thoughts:

    • One, I'm happy the Monday's are almost in the rear-view (this one in particular).

    • Two, tomorrow is counter-trend Tuesday, so keep that in mind as you pack it in for the evening.

    • Three, I'll get my paws around this new schedule, which now includes being "hot" (read: live) for the final hour each day. Look at me, I'm A.D.D.? You betcha, and it's just entered an entirely new realm.

  • Fare ye well into the bell, Minyans, and may peace be with you!


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