Randoms: The Moment of Truth
The most important level of the year is again upon us
A fresh five-session set explodes on the scene as Hoofy wrestles control to start the week. With S&P 950-55 thisclose and the CIT Group (CIT) kick-save fresh in our keppe, an initial upside thrust made sense. Now, of course, comes the million-dollar question: Where do we go from here?
Some top-line vibes as we soak in the flickering ticks:
- Much as we spy green seeds in a Red Sea (stocks that trade "dry" during waves of supply), red beans in a Green Sea (heavy stocks in an "up" tape) offer equally interesting clues.
- In that vein, please note super-tell Bank of America (BAC), Citigroup (C), Intel (INTC), UnitedHealth Group (UNH) and Qualcomm (QCOM) are slinky Sally's to start the week.
- I generally like to give post-expiration hangovers (Monday's after expiration) a few hours to shake the cobwebs (as dealers square outstanding positions).
- As that fog lifts, a fresh sniff of the tea leaves finds NYSE internals 2:1 positive, mixed equity tells and a lower dollar (which is a necessary precursor to-but no guarantor of-higher asset classes).
- The asterisk on this equation is the monster resistance directly above. While I generally hate levels everyone is watching (I avoid crowds unless they're at concerts or sporting events), the proximity of that level, coupled with tomorrow's Turnaround Tuesday, offers cause for pause.
- Most folks believe it's simply a matter of time before we break on through to the other side. With that in mind, it's interesting to note the put/call ratio is at the lowest level since the rally began (signaling complacency).
- How 'bout Turtle and Jamie Lynn, eh?
- Y'all see the pension problems percolating with our neighbors to the north? I would expect to see more of these "flair-ups" as the point of recognition permeates that there isn't enough money to go around.
- A loyal Minyan who works at a high-end retail establishment just pinged to inform me "We've noticed in the last two weeks a huge shift in consumer mood. It's such a pleasure working with people once again!"
- While the meat of my positions are autumn leaves (remaining put positions that expire in the fall), my discipline slipped last week. Why do I share my missteps? With hopes you avoid them altogether. The trick to trading-much like dieting-is that while everyone slips at times, the key is never to fall.
- If you're staring at every tick, you're likely out-sized with regard to your risk. If you've got a game plan and can hold on to the handlebars with loose grips and an open-mind, trade 'em seven ways till Sunday. Where you stand is a function of where you sit.
- While Foreigner can't hold a candle to me of late, I will offer that barring a mad dash higher through S&P 955, the stage will be set for some crimson fret into tomorrow, if for no other reason than to keep Hoofy honest.
- As always, I hope this finds you well.
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 email@example.com.
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