Buzz Bits: Dow, Nasdaq On the Rise
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Answers I Really Wanna Know...- Todd Harrison- 3:30 PM
- Isn't a lift of the previous breakdown (S&P 1500) an intuitive retest?
- Are you watching BKX 115 as the other important "first try" level for Hoofy?
- On the constructive side of the coin, y'all see market internals edging towards a 2:1 reading?
- Will traders pull a Warner Wolf and say "let's go to the video tape' (i.e. earnings) before making bigger bets either way?
- How relevant will earnings be given the interest rate backdrop and the nosty global bond markets?
- So, what's your favorite Hoofy and Boo's News & Views episode?
- Are you looking for a special gift for that special someone in your life?
- If you're playing volatility, are you using "out month" options rather than June paper (which expire next week)?
- Who doesn't enjoy a good back scratch?
- Who doesn't miss summer camp?
- It's nice to have a trader's tape again, eh?
- Are the Black Crowes the most underappreciated band of our time?
90% Solution- Jon Markman- 2:22 PM
Analysts at Lowrys Reports put out a note that yesterday's market action qualified as a 90% downside day. That's a condition in which, basically, 90% of the stocks and 90% of the volume in the New York Stock Exchange are down. It doesn't happen very often, but when it does, Lowrys points out that it is a climactic selling event usually associated with market bottoms rather than the start of major declines.
In case you're not familiar with the name, Lowrys is probably the oldest technical analysis firm catering to institutions, and among the most respected. Its specialty is in measuring supply and demand pressure in the market, and they have a great record of identifying important inflection points.
Usually after a 90% downside day you will get at least a snapback rally, but very often you need at least one more to really wash out excess optimism and put a healthy level of fear back in investors' hearts.
Going back into ancient history, a couple of 90% downside days were registered at the bottom of the March '07 decline, as well as at the major bottoms in October 2002 and March 2003.
Food Fights- Jeff Macke- 12:29 PM
- Interesting that McDonalds' (MCD) insanely great 8.7% comps are being attributed in large part to its tie-in with Shrek the Third. My radar may be jammed in terms of the appeal but I'm not convinced there are kids lined up outside MCD's so they can get their Happy Meal Tie-In products.
- Good break-down here on the FTC's bizarre decision to fight the merger plans of Wild Oats (OATS) and Whole Foods (WFMI). My free advice to WFMI is to simply dump the idea of the merger entirely. No, the FTC's objections don't make sense but OATS simply isn't worth the distraction to a struggling WFMI.
- Not playing in my Luddite Lean-To: Pirates 3, Oceans 3, Shrek 3, Godfather 3, Threesome, 23 or Three Men and a Lady.
Some morning thoughts- Jeffrey Cooper- 10:53 AM
- It's not too early to watch the Pin the Tail on the Donkey Equity play, it strikes as next Friday comes into focus. For example, Mastercard (MA) is ratcheting to 135 and back to 140 within an hour!
- The stabilization that needed to play out may be taking place, it's not unusual for an up-down-up sequence to be carved out rather than an immediate attack of 1500 then 1507-10.
- 1502 is 90 degrees down from 1541. Closing the week above that level puts the market back into a stronger position for next week's exp.
- Texas Industries (TXI) and Cleveland-Cliffs (CLF) look interesting so I recommend taking a look at their dailies.
Positions in MA, TXI, CLF
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