Minyanville Alert: The Moment of Truth!
The rubber meets the road.
We have arrived at the moment of truth.
The bulls can deliver the knock-out punch with a breakout through S&P (INDEXSP:.INX) 1600 OR the bears will claim the dreaded "double-top" and with it, gain some much-needed self-confidence.
If my performance this past week in the markets were an '80s rock song, this would be it.
Brrr. It's lonely in the cold....
However, the only difference between being early and being wrong is whether you're there when the trade hits. I've chronicled my missteps here and here, so no need for further flagellation; suffice to say I got too big too early—I wasn't right-sized—which put me on my heels as this important juncture arrived.
The charts below tell the tale across multiple horizons.
The mid-term technical take demonstrates the importance of +/-S&P 1600. There will be buy-stops set on the other side of that price point -- much like there were sell-stops below S&P 1540 -- and that will add further spice (and volatility) to the mix, if and when.
Longer-term, you know the show, but the image is too powerful not to share again.
It's the Triple Lindy, in all her glory.
Where you stand is a function of where you sit. I'm operating with the portion of my pad that is used to big swings but ultimately, discipline must always trump conviction. While I've rolled my stops to the top end of the range, I must ultimately defer to the truest tenet of trading, that of discipline.
Market breadth is great, leadership is balanced, and gold has room to run before it smacks its head on $1,550.
If I were a bull, I would be feeling pretty good just about now -- maybe a little bit too good, but hey, they've earned it.
But we’ve seen what happens to bubbles of complacency, be it Apple (NASDAQ:AAPL) at $700 or gold at $1900. I would offer that US stocks currently share that rarified air.
I'm a bear in here -- a bit burnt and a tad slimmer, with an old hat and of course, defined risk.
As always, I hope this finds you well.
Follow Todd and over 30 professional traders as they share their ideas in real-time with a FREE 14 day trial to Buzz & Banter.
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.
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.