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Random Thoughts: Will Lower Commodities Help Stocks?

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Markets look for a Turnaround Tuesday gain.

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  • Man, is it hot enough for ya? Nelly ain't got nothing on New York City.

  • If you liked the long gold/short oil pairs trade on Friday, you should absolutely love it today.

  • The most interesting action on my screen out of this morning's gate? The giggling green financials, which are trying to step up and stand out. As go the piggies...

  • Given this chart, which shows the carrot of the banks to the horse of the market, they better catch a bid or Lucy is gonna have a whole lotta splainin' to do.

  • The hardest, most counter-intuitive trade in the marketplace? How bout long financials, short energy? I slapped that trade on this morning with tight stops and an open mind. It is, after all, Turnaround Tuesday.

  • From there? My mandate this afternoon is to swap out of that long financial exposure, keep some short crude and rotate some coin into gold stocks--like Gold Fields Ltd (GFI)--to play the ratio regression.
  • I'm uber-conscious of the potential for a downside disconnect this summer. That remains on the back burner in my crowded keppe at all times. Talk about a fire hazard!

  • Peas are the most under-appreciated veggie, sweet potatoes are the most under-appreciated starch and Thurman Munson is the most under-appreciated catcher of all-time.

  • Levels I'm keep an eye on through the lens of "past support is future resistance? CME (CME) $400 and Continental ( CAL) $16, if and when.

  • NYSE internals started the session with four red for each ahead and since "improved" to 2:1 negative. Keep an eye on this, along with S&P 1350, which is a loud level in trading circles.

  • Ben Bernanke said that the risk of a "substantial downturn" in the economy has receded in the last month? Seriously? Duuude, people on ludes should not run the economy!

  • While I strenuously object to the notion that Big Ben can raise rates, perception is reality in the marketplace.

  • "Lehman (LEH) sold 145,000,000 shares at 28 yesterday, likely to favored hedge fund clients that could flip them. Guess what? Now LEH is under 28. This is a sign of extreme weakness in my view and enforces my belief that the company has no handle on its business and will be forced into the hands of a larger institution. Keep in mind, I have no position here, folks, nor have I post-Bear." Bennet Sedacca on today's Buzz.


R.P.

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Position in LEH, GFI

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.

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