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Random Thoughts: The Rubber Meets the Road!

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Washington and Wall Street attempt to meet in the middle.

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It's Turnaround Tuesday in the 'Ville with the critters looking for a thrill. As I sense you're busy -- and I know I am -- I'll invoke my literary license and serve up some old school Random Thoughts, in no particular order.

  • Here is the interview with Bloomberg's Betty Liu (the smallest of the Liu's) yesterday morning, live from the floor of the NYSE. She -- and Bloomberg -- are great, as far as financial television platforms go.

  • Russian Prime Minister Vladimir Putin said the US is "leeching" on the rest of the world -- he went so far as to call us a "parasite" -- and added that we could see a dollar devaluation. Note his vernacular, as it's consistent with many of the themes we've long discussed in the 'Ville.

  • There are two sides to a tangible solution for our country -- austerity measures (spending cuts) and upward taxation (select income and items, such as sugar).

  • Why can't we have a civilized discussion about a meaningful solution without it morphing into a venomous battle? This isn't about a Republican or Democratic agenda, it's about being an American and manning up!

  • S&P 1285 is the 200-day moving average. A breach of that level "works" to the right shoulder at S&P 1250 (which, if breached, "works" to S&P 1130). That's the downside stair-step, for those looking for a technical context with which to measure risk.

  • How did I calculate that? It's the head (1370) minus the shoulder (1250), and you subtract that number from the shoulder (1250). And yes, the same math works for inverted head & shoulders... only in reverse.


    Click to enlarge

  • The NDX? The four-letter freaks need to hold NDX 2300 to keep the (potentially bullish) reverse head & shoulders in play (should NDX 2425 breach to the upside, that would "work" 100 NDX points higher).


    Click to enlarge

  • The two potentially bullish elements of yesterday's price action? The financials -- which have been beaten like a red-headed drum -- tried to find a bid into the close. Goldman (GS), Morgan (MS), Bank America (BAC), and Citigroup (C) put on a brave face, and if they can build on that confidence, the "press lower" we foresaw yesterday could prove short-lived.

  • I would also draw your attention to yesterday's market breadth, which remained balanced (as it is thus far today) despite the Red Sea that dominated my eight screens.

  • Europe, which reversed lower yesterday before the stateside indices followed suit, is again taking it on the chin today. We could debate the tail and the dog all day, but see it first and hypothesize later.

  • Why do they have A.D.D. medication -- who can ever remember to take it?

  • Is Wall Street telling Washington that its proposed plan is a "Band-Aid on a Broken Bone"?

  • I haven't monitored the markets on a weekend (like this past weekend) since that fateful stretch in 2008. Not sure if that means anything, but I sure enjoy "real" respites better. In fact, I would like to officially table "four day weeks/three day weekends" between Memorial Day and Labor Day!

  • I got engaged this past weekend. I know it's anticlimactic following the birth of our daughter Ruby (11 weeks ago) but I'm still psyched that I was rewarded for my 42 years of patience with the most amazing woman I've ever met. Thanks for saying "yes" Jamie, I would have been pretty embarrassed if you passed!

  • As always, I hope this finds you well. We'll see YOU over on our real-time Buzz (click here for a FREE trial).

R.P.

Twitter: @todd_harrison

Follow Todd and over 30 professional traders as they share their ideas in real-time with a FREE 14 day trial to Buzz & Banter.

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No positions in stocks mentioned.

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.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.

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