Levels Matter

I’ve been having an ongoing debate with a
friend (he manages a sizable mutual fund) about technical levels; He’s a fundie
guy who looks at earnings, listens to conference calls, speaks to management
(Ha!) and does channel checks.

Out of all of those activities, the only ones that have value to me are the
channel checks — they are objective data points.

His takeaway on today is: "Oil’s up, and the Fed will keep
tightening."

My view: the Bulls have been unable to get over the resistance
hump — at least so far– and each failed attempt weakens them.

That’s why one
never anticipates a breakout, and waits until it occurs. I said earlier I was
"back to watching my levels, and getting ready to flip more bullish (on a
closing basis) as necessary."
That remains the plan. That said, the day is
still young.

Regardless, for those of you who may not appreciate the technical side,
recognize that charts include, encompasses and reflect all the activity that the
fundamental side is doing — especially the big institutional players.

I think of charts as the elephants’ footprints . . .

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