The Donna Summer Double Top
See both sides on Freaky Friday.
I was chewing through my charts this morning, as I do, and my first impression was Donna Summer.
He said what?
Yes, Donna Summer, the disco diva, born LaDonna Adrian Gaines. That Donna Summer.
Because since I spied the patterns in the S&P and NDX, I haven't been able to get the five-time Grammy winner out of my crowded keppe (and I'll bet you can't either).
Last dance, last chance for love. Yes it's Boo's last chance for romance today....
And why you ask?
The markets are either going to form duel double tops-should the S&P remain under 1380 and if the NDX is capped by 2650-which would be a bearish sign, or the tape, emboldened by the Greek debt accord and empowered by constructive economic data (note the .2% up-tick in the labor participation rate), will break out to fresh cycle highs (which would stop out the last batch of those dancing bears).
Until proved otherwise, this setup provides nice and tight defined risk for those banging with Boo, but as always, we strive to see both sides in the 'Ville-and now you do.
Good luck today.
The ISDA-International Swaps and Derivatives Association-is meeting as we speak to determine if the Greek debt restructuring constitutes a "credit event."
If it does-and in my opinion, it should-that will trigger credit default swaps on Greece, where the unknown risk will surround who wrote these contracts, and how that reverberates up and down the financial food chain. If they don't trigger, there will likely be unintended consequences of a different breed as holders of these insurance contracts may no longer trust their ability to perform as anticipated when they were positioned.
In technical terms, this is "sort of a big deal" so keep your eye on the outcome and understand that either way, there will be ramifications under the financial hood.
Have a great weekend; you most certainly deserve it!
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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 firstname.lastname@example.org.
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