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Random Thoughts

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Someone once said that the toughest fade is usually the best trade. How true...

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  • We paddle into Gotham this morning to find stormy seas and crimson tides. And it's raining out too.

  • The most notable element of the initial liftage this morning? Market breadth, S's and N's, remained 2:1 negative. That, coupled with triple resistance (and defined risk) in the financials skewed the dew to Boo's crew.

  • File this under "sometimes right, sometimes wrong, always honest " but I pared some of my core exposure (including Sun Micro (SUNW) and Goldenstar (GSS), although I'm keeping some of both) and bought a slab of S&P puts into that rally.

  • Someone once said that the toughest fade is usually the best trade. How true...

  • I didn't hear anything "good" in Bernanke's testimony other than the fact that it seemed relatively forthright. Which is good...and bad.

  • As we've chronicled in this space, the sub-prime contagion was gonna take a few weeks to leak out. Those mark-to-markets are seemingly filtering through portfolios, which could spread in the context of an interwoven, derivative-laced financial fabric.

  • Invisible risks are always tough to trade but we can appreciate risk, which is cumulative as a function of the ever-present compression. That doesn't mean it'll manifest today, mind you, but it clearly warrants attention as we roll up our sleeves and shake off the leaves.

  • I wonder if Alan Greenspan has an adjustable rate mortgage?

  • "A wise trader once told me crashes don't come from to much bullishness, they come from too much complacency." Professor Jeff Cooper on today's Buzz .

  • Check out this chart of the BKX, which failed right where it "had" to. These names, a proxy for all things finance-based, have led the market both ways. As there's been steady supply all day, it should be noted.

  • There should be Snapper attempts but as we know, tapes that are heavy all day (with 2:1 negative internals), tend to end that way.

  • Watch S&P 1540 as well--it's about to flip back to resistance. I'm resetting my stop to the other side of that ride (on my S&P puts) and trading tight (to avoid unpleasant surprises).

  • Barney Frank was grilling Ben Bernanke this morning, stressing the importance of investor education. We get it in the 'Ville and by the time the Mini-Minyans head back to school, we'll have critters teaching financial literacy across the entire vertical of finance.

  • Speaking of which, check out the new episode of Hoofy and Boo's News & Views over on MVTV. We've packaged it with some stellar content on the China and, in the current day and age, a little levity goes a long way!

  • As always, I hope this finds you well.


R.P.

Position in gss, sunw, s&p
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