Editor's Note: Todd posts his vibes in real time each day on
Buzz & Banter
I remember it like it was yesterday. The stock market had crashed
and the very existence of capitalism was under siege.
After a sullen stretch of Shock & Awe,
I forced myself to not only see the other side of the trade, but
heading into that fateful weekend,
position for it in kind.
The following Monday, March 9, 2009,
I stayed true to my belief
that the stock market was in the "panic" portion of our time-tested
Three Phases of Leave
, which would also serve as the "denial" phase for the bears after
they cleaned up on the downside.
On March 10, 2009, I maintained my long bias -- we spoke of risk
-- and penned several columns sharing my thought processes,
The tape responded with a sharp rally higher; I stayed the course.
On March 11, 2009, we dove deeper,
discussing the classic signs of a bottom
and the potential for a 20% move higher even at times if
We Were Running to Stand Still.
On March 12, 2009, we continued to fight the bullish plight,
and on March 13 -- following one of the greatest games in the
history of sport --
I "lugged alotta exposure"
into the weekend once more.
That Monday, it was business as usual;
as societal acrimony spread throughout the
, we spied
Bank Shares Ripping
and prepared to take a ride higher on the Matador Express. At the
) galloped 35% ($0.63),
Bank of America
) ran 13% ($0.77),
) jumped 66% ($0.33) and both
) jumped 5% (about a buck each).
The bacon was shaken and the tape was about to blast off...
The next morning, Tuesday, I awoke to a telephone call from a
colleague down south -- a stunning, terrible call that at first I
thought was a dream.
I shared what I could with our community,
withholding particulars as a function of respect. Later that
evening, with tears in my eyes, I wrote
A Tribute to Bennet Sedacca
Why the walk down memory lane? For one, to remember a special man
who left a long-lasting legacy, one that continues to live on
through his kinship and friendships. Second, I recall that historic
stretch as I was very bullish -- not all in, but trading
aggressively from the long-side -- when "life" interrupted, I
flattened my pad, flew to Orlando, and focused on the important
In hindsight, it took me some time to recover my trading feel --
the S&P rallied some 15% while I was away from my turret -- but
I didn't, nor do I now, regret it for a moment. As soon as I booked
my flight down south to be with the Sedacca clan, I flattened my
pad to the penny, reminding myself that "blind risk is bad risk"
and "if you're not there to manage your risk, you're at a natural
Fast-forward to modern day. Last week, we painted the current
financial picture -- it is
The Moment of Truth
Stocks Toe the Maginot Line
. This, of course, was shared in the context of some
less-than-stellar risk management by yours truly
, so in that regard, March 2009 and April 2013 are different. Back
then we had seemingly turned the upside cusp and I was making cake
when I flattened my pad; currently, we're at an important technical
toggle and I gave back a chuck of performance last week.
Be that as it may, and as I've repeated many times over the course
of my career,
discipline must always trump conviction
. As I am scheduled for a total hip replacement tomorrow -- one
where I don't foresee
an ability to "trade through" as I did last May
-- I will be paring my September
puts as we approach the aforementioned moment of truth
If the bulls push through, it's a bullish "cup-and-handle"
formation; if they fail, it's the dreaded double top (bearish). See
both sides as we continue to find our way, one "step" at a time.
As always, I hope this finds you well.