Stuffing Attempts Ahead Of Thanksgiving

Stuffing attempts ahead of Thanksgiving - failed to light-up excitement, as it was pretty obvious (by a factor of 10) how they tried to trap some hedge funds holding the 'most-shorted-stocks' which were up more than the overall market.

By the time it was all finished, the market was virtually unchanged and the S&P drifted a bit lower in late trading. Sentiment and volatility got sort of complacent in a way that is only slightly unusual on this day before Thanksgiving; with late fading being exactly what we expected; given a suspected 'absence of bids'.

The general sentiment is that geopolitical tensions have eased; but that's only true regarding Russia coming forth and saying they won't go to war with Turkey over the shoot-down of the SU-24. In an earlier intraday comment I remarked it was interesting, not only because there's precedent of Syria shooting-down an old Turkish F-4 Phantom which crashed in the Mediterranean just several years ago; but that Erdogan at the time said 'nobody would do that for an incursion in neighboring airspace that is very brief. That's the opposite of his tack this time.

Also the Russian pilot complained that an F-16 is far faster than his SU-24; so it would be protocol to pull alongside and give visual hand-signals should another fighter pilot 'believe' radio communications had failed or that the intruder was in foreign airspace. The reality is Turkey was protecting the Turkman faction that's fighting Assad, and operates in that area, while nobody mentions the affiliation that group has had with al Qaeda not ISIS; but basically branches of a similar tree. Just thought this worth noting, as the US and Turkey are supporting them; and yes those were the guys screaming 'Allah Akbar' after they murdered the 1st pilot, who had otherwise safely ejected; but killed by them on the ground. It is sadly characteristic of Islamists who never imagined a Geneva Convention (on prisoners, which would make their killing the pilot and everything all these assorted barbarians have done to mankind essentially homicidal war-crimes).

So Russia and Turkey calmed-down for now (like US pressure on Turkey and in this case France pressing Putin to not be impulsive as we're all in this trying to suppress and dislodge ISIS); but the ISIS factions released yet-another 'HD' video (ever wonder who does their film editing and why they have high-speed internet connections in the middle of the desert, which satellite internet cannot deliver, and former cable or wireline services from Iraq, Syria or even Turkey, in theory should be shut down by those governments. So how do they do it? They have help. Someone should be not just shutting down their IP addresses, but in the process figuring-out which hosting services or Servers are assisting in their propaganda, which is their primary way of radicalizing potential recruits in some parts of the world. If this is indeed a world war against Islamist extremists, then anyone anywhere in a civilized nation that assists, is aiding and abetting crime, as well as consorting or facilitating enemy action. Should that be defined too?

Next week, some believe the economic picture will be defined by the Jobs data or other economic data that may affirm (or deny) the Fed's planned rate hikes. I suspect that another global exogenous event could impact that; but rather think it otherwise is on the agenda, and won't be deflected by a mediocre jobs report, which of course is now what the bulls want to see (in hopes it freaks the Fed).

I think we had fairly soft data this week, including Consumer Confidence, that it would be unusual if the Jobs number was particularly impressive, especially if one (again) adjusts-out temporary seasonal jobs, and those part-time working elders, who certainly can't get a decent low-risk return on any savings; although no interest rate increase (or series of jumps) in the near-term will be sufficient to provide a 'meaningful' return on low-risk holdings; or pension actuarial goals that remain (in many cases) based on ludicrous assumptions about total return.

Last week we mentioned the prospect of China being included in a FX basket.On Monday, the IMF will likely grant China's Yuan reserve currency status. That will include it in the fund's Special Drawing Rights basket. While symbolic, that will elevate the currency and China's global stature. It may ironically also come just before they 'devalue' again; because of huge debt issues. If so, anticipation of that might have as much to do with the Dollar's projected strength (DX up at or around 100 now as I called for as a part of our multiyear Dollar bullishness in patterns that evolved as the Euro came down from 1.39-1.40, to press parity, all part of our pattern evolution call since the DX was down under 80).

A stronger Dollar, and especially if accompanied by firmer Oil prices, might just be a bit more pertinent than whether or not a few more jobs are created, while it has been notable how they fail to accurately track those not determined to be in the job-seeking mode or employable. In any event, caution remains appropriate as we move into the new trading week.

Daily action - was pretty neutral much of Wednesday; not only because of thin pre-Thanksgiving attendance, but notably with the 'most-shorted' stocks again revealing the nervousness; as the morning saw that group was up 10x the S&P itself; hence there's no serious buying interest; just short-squeezes where then can move a stock here and there.