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Buzz Bits: Dow and Nasdaq End Up

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Your daily Buzz & Banter highlights.

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The Duck Duck Goose! - Todd Harrison - 3:04 PM

  • You know what keeps repeating in my head? No, not this. It's the axiom that the sharpest rallies occur in the context of a bear market.

  • That's not to say this can't continue. Fading strength has been pretty, pretty, pretty, pretty easy (think Larry David) and nobody makes consistent money in a bear market, not even the bears.

  • Still, it is Tuesday. President Tyler has seen to it that her legacy lives.

  • That, coupled with the sudden "all clear" euphoria in some media arenas is a bit concerting.

  • And then there's the matter of S&P 1310 (right here, right now).

  • I'm not making big bets, mind you, although I did just layer into another round of driller puts. That, and a few long side situations, is how I'll head into the Hump.

  • Well, that and almost 20,000 Minyanland residents that is.

  • As the 'Ville gains mindshare, we're getting "hit" by a multitude of Minyans from around the world. That's caused some server growing pains but we assure you that we'll have the house in order quite quickly.

  • Fare ye well into the bell, Cowboy Mouth!

    R.P.



Large Cap Tech Strength - Sean Udall - 2:55 PM

Large cap tech is showing strong follow up action on yesterday's stealth strength.

Yesterday a few large cap tech names bucked the selling, notably Cisco (CSCO) and Microsoft (MSFT). Today, many other large cap names are adding to the performance while CSCO and MSFT remain strong. Large beta has found a bid today and maybe once the liquidity issues with credit ease, the dire liquidity trading issues in the small/mid cap tech (small/mid beta) space will become less pronounced.

When I say dire liquidity issues, it's not related to the companies themselves. Many of which have more liquid balance sheets than their large cap brethren. The lack of liquidity is just simply a vacuum of buying interest on anything below large or mega cap beta.

One such example of late has been Omniture (OMTR). Again, recent results have been solid (2008 outlook was positive by the company), the stock rose after its analyst day (traded over $23), they signed a recent deal with Baidu (BIDU) and they were upgraded yesterday. Yet there has been nada on upside price movement of late.

I probably favor ValueClick (VCLK) but was looking around in the post-DoubleClick merger announcement space today and noticed that OMTR was trading just about as poorly as VCLK -- even after the BIDU news. At some point these kind of names should produce larger upside moves then their large cap counterparts. However, that will not happen until some kind of buying interest resumes with regard to small/mid Beta.

So I'm looking for a firmer TA turn and some volume, to get more aggressive on these kind of names -- but sometimes it's worth putting a partial position on the books at what feels like a deep discount price.

Position in OMTR,CSCO and MSFT



Bear Market - Adam Warner - 1:58 PM

The most interesting series today is clearly the Bear Stearns (BSC) March 30 puts. Volume as I type is 40,400 versus an open interest of just 12,081. At 30 cents, these options are dollar cheap, and volatility incalculable.

March 35 puts are no slouch either with 21,000 on the tape and an open interest of 4076.

BSC is trading near $60 right now.

As always, be incredibly careful shorting thrombolic volatility like this. There is one surety; BSC will make some big moves between now and expiration. And there is one unknown; do these big option prices on the board give you enough cushion to withstand the inevitable move in the stock.



You Can't Make This Stuff Up - Fil Zucchi - 12:50 PM

This interesting factoid from the sharp eyes of Tony Crescenzi at Miller Tabak:

"As of February 27th, primary dealers held the following positions:
$139.7 billion of agency securities and $60.2 billion of mortgage-backed securities. I mention these, because the Fed said today that it would lend up to $200 billion of Treasuries in exchange for the above, which means that the Fed's facility literally is able to handle all of the agency securities and mortgage-backed securities that dealers hold
."

Now if I could only pledge at the Fed's window my '02 Acura MDX that I've been trying to sell.


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