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Random Thoughts: The Tug-O-War Tape

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Can bears take back the upper hand?

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  • The check is in the mail!

  • European Central Bank President Jean-Claude Van Da, er, Trichet offered this morning that inflation will remain "high" for quite some time, signaling that the bank is in no rush to lower interest rates despite the economic slowdown. That's the reason you saw some supply in the greenback and an initial lift in commodities.

  • There's a fine line between rationalization and justification when trading but I, for one, still believe the dollar has further upside. Particularly if there's now a coordinated agenda from abroad.

  • Past resistance is future support and vice versa. As such, everyone leaning against S&P 1405 on the short side, only to reverse course and use it as a bovine backstop, is now in the process of rethinking that risk.

  • I'll again offer that technical analysis is a better context than catalyst, as those getting whipped can surely attest.

  • Things I've learned.

  • Eyes of the World? Sing it Fat Man! For my part, the pink piggies stand out, particularly through a longer-term lens.

  • Man I miss Jerry.

  • In udder news, I nibbled ever so gently on further put exposure during the morning jig in the drillers as a function of the lower highs vis a vis all-time highs in the underlying. I've got a tight leash (recent highs) but that's how I'm barking. Woof.

  • Speaking of woof woof, McClatchy (MNI) has the black lung, Pa. Shame on me for not paring into strength as a function of discipline-Yes Trading Gods, I hear ya loud and clear! I also nibbled anew on that single digit midget as it's back near my cost basis.

  • Before you get too bearish, Boo, check out market breadth, which is hanging tough despite the double whammy of the financials and technical breakage.

  • With all this nibblin' and not much exercise, is it any wonder I've found ten of the pounds I recently lost? Just in time for summer... noice!

  • N's over S's in a big way, thus far, which adds to the importance of the action in the financials. I did pare some puts in Merrill Lynch (MER) earlier, pure discipline, as I rotate risk and play the game.

  • What does "N's over S's" mean? The relative out-performance of the NDX over the S&P. If you're hanging with Hoofy, the tech complex has some tail winds today, as opposed to the old school, which is playing salmon to the stream.

  • Salmon. Mmmm...

  • I wanted to muse out of the gate "Hey, given the knee jerk response (lower) in the greenback, it's interesting that crude is flat (indicating possible supply)." I A.D.D.'d the thought but wanted to share the fare.

  • Here's the first in a series of early morning interviews on Yahoo Finance. There was clearly something wrong with the camera as there's too much weight and not enough hair!

  • OK, here's take two, for those with an interest.

  • As always, I hope this finds you swell. Pork chops and apple sauce. Swell.


R.P.

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Positions in MNI, GCI, MER
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