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Random Thoughts: Big Ben Chimes

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The FOMC left rates unchanged.

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Editor's Note: This is a continuation of the posts on the Buzz & Banter, which can be found in Random Thoughts: Bull Costume Update.


The Tale of Twin Tapes - 12:51 pm

  • While nobody on earth is expecting a rate hike--OK, 7 people out of 100 are, according to the Fed Fund Futures--we must respect the fact that these sessions are typically tales of two tapes.

  • With a conscious and healthy nod to remaining disciplined--and given that I've pared some of my exposure added during yesterday's better lucky than smart metaphorical imagery --I'm gonna humbly remove one leg from the bull costume, leaving one leg or 25% conviction on the long side. Hit it to quit it.

  • The "sell stop" on the leaves, so you know, remains on the underbelly of S&P 1250, or the third higher low.

  • Udder levels of lore? BKX 68.60--which would be a higher high for the financials--and NDX 1850, which is near-term resistance for the four-letter freaks.

  • Once the "lower crude is equity positive" myth is debunked--something we've been saying in Minyanville forever and you can now read about in the Wall Street Journal--the "higher dollar will be equity positive" myth will be the next to fall.

  • Things that I enjoy more than going to the dentist include:

    • Sticking my arm in a blender.

    • Tailgating at Mile High Stadium surrounded by donkey fans.

    • Being told by my ex- that I'm a bad lover (how could she possibly know in thirty seconds?).


It's Always a New Paradigm--Until It's Not! - 1:51 pm

  • While there was a fair amount of pushback when Minyanville called crude a bubble a few months back, the updated comparison to technology, China and the homebuilders finds Texas Tea following the same script.

  • Absent an uptick of angst in Iran--I know, that's a pretty big if--my sense is that we'll continue to traverse that slippery slope. The trick--and the zillion dollar question--is to ascertain when the collective mindset shifts from that being equity positive to being endemic of slowing global growth.

  • Do I foresee a massive post-FOMC reversal lower? No, I don't.

  • Am I blindly betting that it won't occur? No, I'm not. I've sold enough inventory to protect myself from the dreaded corks which is why I removed one leg from the metaphorical bull costume.

  • The other side of S&P 1250 remains a critical context. Not just for me--narcissism now!--I'm talking about the entire, technical--and by extension, psychological--construct.

  • This South Beach diet--or what's left of it, anyway--is making me HANGRY!

  • Fare ye well into the Fed, Minyans and remember--discipline over conviction!


Tricks of the Trade! - 2:12 pm

A few quickies from Kenicke as we ready to rumble.

  • The first move following the FOMC is typically the false move.

  • Hold your "stops" upstairs to avoid any unpleasant fills.

  • It'll be thin and whippy on the announcment and it's a good idea to trade smaller size.

  • The big boys from Macroland prolly won't "act" until tomorrow.

  • If you don't know, don't go. Pressy, stressy and guessy is no way to go through life, son.


Parliament, Big Ben! - 2:25 pm

  • The standout line from their text? "Over time, the substantial easing of monetary policy, combined with ongoing measure to foster market liquidity, should help promote moderate economic growth."

  • I continue to scale out of exposure into the first higher move (uh oh) with an eye towards adding some beef back into a pullback.

  • If we don't get it? Well then, opportunities are made up easier than losses.

  • If we do? S&P 1250 (have you picked up on the importance of this level yet?).

  • I don't mind not being involved in the financials in here. Trades are made to be taken. I'll continue to watch 'em like a hawk, however, for as go the piggies, so goes the poke.

  • Keep an eye on the homies, homie. They've been laggy (so has Goldman (GS)) all session.

  • Deep breath, friends--we're almost there.


R.P.

No positions in stocks mentioned.

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 todd@minyanville.com.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

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