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Buzz Bits: Dow, Nasdaq In the Red


Your daily Buzz & Banter hihglights.


Editor's Note: This is a small sample of the content available on the Buzz & Banter.

Bell Buzz! - Todd Harrison - 3:35 pm

  • As discussed, there's nothing wrong with some Classic Neil on our time!

  • If you're trading the airlines, look for system disruptions tomorrow. Given my same day Texas two-step, I'm laying 2:1 that the perfect storm awaits.

  • A little perspective in the piggies, Yo.

  • Voyeur! Yeah, that's me as I'll be watching Aunt Fannie's (FNM) earning report tomorrow like some sorta twisted perv. I can't begin to tell you how many $70-line puts I ditched in this name, with the last batch being buried right before she fell out of bed for the first time!

  • I may rename Hank Paulson "Red Button" for obvious reasons.

  • Either way, the ability of Hoofy to hold S&P 1405 is a feather in the bovine cap.

  • Feeling Helpless? Hey, it's not your fault, this is one tough tape!

  • Helpless, Clueless, Iceberg, Goldberg...Whateva! I'm outie like Cher Horowitz tomorrow but I'll try my best to sneak out some content in the ayem before I dive to the Big D. Fare ye well into the bell and have a snazzy overnight session!


What I... - Quint Tatro - 1:34 pm

What I Like:

  • Light volume distribution.
  • Dry bulk shippers clearing significant resistance.
  • Home building ETF's green a la XHB.
  • Growing pessimism over further upside.

What I Don't Like:

  • My buddy DUG.
  • Yahoo's (YHOO) ego.
  • Not boxing my trifecta. Are you kidding me?

What I've Done:

  • Cut a video about not doing much.
  • Started wading back into S&P via SP Ultra Long (SSO).
  • Started new China momentum play Global Source (GSOL).
  • Double checked to make sure GSOL was really China and not Bermudian. Huh?

What I'm Watching:

  • Financials via the XLF, they hold the $27.00 area, I remain long and will go longer.
  • USO break new highs on significant V-shape reversal. Bull trap anyone?
  • Bearish wedge developing on intra-day S&P chart.

Positions in XHB, DUG, SSO, GSOL, XLF, USO

SDS in Declining Wedge Prior to Upmove - Michael Paulenoff - 12:58 pm

All of the action in the UltraShort S&P500 ProShares (SDS) off of the March high appears to have taken the form of a "declining wedge" pattern, which attempted to break to the downside last Friday, but could not sustain the breakdown into new low ground.

Instead, the price structure has clawed its way back above the lower wedge boundary line prior to what my work argues should be a "violent" upmove that propels the SDS to test the upper boundary line of the wedge pattern, now in the vicinity of 58.00/25. Should the SDS hurdle and sustain above 58.25, then the declining wedge pattern will be complete, and the price structure will confirm that it is in the midst of a potent recovery rally period that projects to 61.00-62.00.

For the time being, the SDS has more work to do, but already is giving initial indications that the March-April downleg is complete.

Click to enlarge

Why it's so hard to trade credit... - Bennet Sedacca - 10:49 am

Let's suppose that you were bearish on the credit of Bear Stearns (BSC) (like I was) and you bought 5 year CDS (I didn't, I don't trade CS).

Now suppose Bear starts to unravel. It nears bankruptcy and CDS explodes out. You're ready to cash in big! Now what happens. JPMorgan (JPM) and the Fed to the rescue.

The CDS collapses from 750 basis points to its current 64 basis points.

The moral hazard card sure makes it tough these days.

By next year, however, I think that will all change. More later.

See the chart below:

Click to enlarge

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