...what's a Bove?

It was 5 trading days ago as DOW caps were in back in vogue, we said, “we think it’s a better idea to put on a hockey helmet as we creep closer to SPX 1100”.   Simply,  this was to avoid getting any hits into the boards as in banging your market head against a 1100 wall too many times and to avoid any concussions as in a sell off sooner than later.   Of course,  in market terms this means don’t be holding too much until we break through the wall.   Hopefully, today we had the helmets on and didn’t get smacked around in the late day ugly sell off with most of the 170 DOW points and 20 SPX coming in an hour. 

Coming off a sloppy day,  we were disappointed by the action and said …“Expectations of a push over SPX1100 on the heels of those reports didn’t materialize and the failure to do so makes many take some off the table”..   The same thing can be said today, another failure  or two in the morning brings out more selling as traders lose patience banging their heads against a wall.    The morning run to SPX 1100 was suspicious and not deserving.   Overseas markets gave no reason for an early move and MS WFC  couldn’t have been the catalysts to breakout.  We were trading the alerted SLM  and weren't really paying attention to a creep towards 1100.    The suspicious factor grew as the studs were hardly moving or in the red.    We’re talking GS, JPM  and the best sub group in financials recently being the Asset Managers BLK, BEN.    If you’re gonna' have a party, you have to know you’re invitation has been accepted by these studs!.   Another failure or two at 1100 and no participation from the GS etc. and it wouldn’t take much else to ruin the day.

What ensued in the afternoon was a bushel of negative things.  We were surprised the TARP 7 actions by the Pay czar didn’t cause a big reaction as we figured Wall street may get pissed off.   Just before this hit the wires, we had WMT give a red light special  in their analyst meetings and post TARP 7 news, we had the Bove WFC downgrade that was construed as the only reason for the sell off as it was going on.   That’s BS,  the broad market doesn’t do an outside day reversal off on a stock downgrade that was already red or flat to this magnitude.   Simply, in our view it was the failure earlier in the day to >1100.   All the other things just added to it! 

BTW, it’s ES futures 1100 that is the real line and we didn‘t even get there!!.  

What’s important is these excuses cited are not FUNDAMENTAL  and give a chance for a bounce if we avoid any FUNDAMENTAL reasons overnight or premkt.  Jobless claims# is fundamental, if you’re wondering what’s the difference.   If we hold 1076 weeks low in the ES overnight and get through the IJC#, we should see a bounce unless those that missed the sell off come scared in the morning and initially add to it.