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Random Thoughts: Playing the Probe

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Making sense of the morning action.

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Editor's Note: The following was posted in real time on our premium Buzz & Banter. It's being shared here for the benefit of the Minyanville community. See also Jumping the Shark in Our Wishbone World? and See the Ball!


Gate Sniffage! - 9:50 am

  • The standout action? How bout Pepsi (PEP) (-10%) and Coca-Cola (KO) (-5%)? It's not like people all of a sudden hate soft drinks--it speaks to the risk in the consumer non-durables in this next world order.

  • As mused earlier, the NASDAQ has indeed dipped into Red Dye. Google (GOOG), eBay (EBAY), Amazon (AMZN), the semis... S's over N's.

  • I just said to Pep "If I had any guts, I would slap on a pairs trade of "long energy, short financials." I mean seriously, how are banks gonna raise money? Other than our money, of course.

  • As discussed, I sold my remaining exposure into opening circle smirk. Now, I watch, finger on the pulse, nose to the ground, eyes wide open.

  • OK, so I did nibble on some bank puts for a quickie. A tight and tiny quickie at that, with an eye towards adding exposure at the right price.

  • Schlumberger (SLB) looks interesting but boy does it trade punk. If we can learn a lot just by watching...

  • Note the gap in the FXY (Japanese Yen). If that puppy fills to 95, I'll consider that an attractive entry level.

  • Lemme jump--I'll be back.



Mr. Money, Meet My Mouth - 10:34 am


Man, I feel like an A.D.D. moth in a light bulb factory! Did you see Juno? Look, a penny! I mean--seriously--can there be more going on?

Cutting to the Vinnie Chase:

  • As per my morning missives, I sold the opening and waded into a few long positions during the Fletch-style probe. BHP Billiton (BHP) and the EEM (emerging markets) were among them (both added down roughly a deuce).

  • They're not HUGE positions, mind you, as I want dry powder to add as a function of time and price.

  • Have we seen the 2008 trading low? That's precisely what I tackled in this column, which was tossed together between gulps of joe this morning.

  • What am I avoiding? Direct sunlight, green bread, cold sores, shady looking dudes, financials (I actually have a small, tight put position on but I'm not married to it), consumer non-durables (that trade has passed), edgeless bets and people who fart in public without saying "excuse me."

  • Note NYSE internals are better than 2:1 on the big board.

  • Don't forget Minyans, we were up almost 1000 points yesterday (and 20% from Friday's oversold low). Some digestion is a healthy thing, or at least that's my take.

  • Don't worry Hoofy, your time will come.

  • Is there a retail outlet in the universe that makes women feel less sexy than shopping at a place called the Dress Barn (DBRN)? I mean seriously--A BARN???


R.P.

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Positions in EEM, BHP
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