9 POINTS DOWN...NOW WHAT?

After yesterday's 9 point MLP debacle, which btw was only a bit more than the 8 point debacle in K Sea Transportation Partners (KSP) we are already sitting today on the chart at a place where rallies have ensued taking us to higher highs going back at least 6 months on this chart. So until proven otherwise from a trading standpoint you have to look around in here after this rapid 6% correction in mlps and add to positions. However is it different this time? Oh if we only knew the answer to that one. The 55 day moving average sits at 250 and some small change and if we go lower at the open we could be right there. A trip to the 89 day moving average took place at the end of June and thats at 244. Another day like yesterday and we're right there. We can probably get that low and still be well within the contruct of the uptrend.

How is all of this going to break? Well in true bull markets it will get resolved with higher highs. We need however to ask ourselves after a move from 176 to 267 on the mlp index in 10 months is a meaningful correction finally at hand? Wouldnt be a big surprise. We noted a few weeks ago that 270 was going to be an extremely difficult wall to get through. Still it is amazing that sentiment in the overall tape got so bearish so fast. And that bearish sentiment is a very good thing to fuel another leg up. As always though they never make these decisions easy.

Okay this morning we begin the ex distribution parade with Holly Partners (HEP) and Markwest (MWE) leading the way. Holly Partners puts up earnings this morning which look pretty good. Williams Partners (WPZ) also announces earnings and announes an improved cash flow outlook going into next year. The news overall from most mlps appears to be brighter than where we were a year ago.

We have some anal-ist moves. Wells Fargo appears to see something in K-Sea's (KSP) distribution cut and outlook yesterday that...well to be perfectly frank..just didnt sound quite right. And so...brilliant minds that they are we see a downgrade from Outperform to Underperform. What would we do withoout these guys? And this morning RBC Capital Markets starts Alliance Resource Partners (ARLP) at Outperform. We can only hoe they are right since we are long this one! I decided to do highlight them in color! Lack of sleep does this to the mind.

Other broader market drivers this morning we have stronger stock futures ahead of data. Energy is a little higher except for nat gas. European markets are a little softer. The dollar is a little softer also ahead of data...gold and silver are higher.

Okay do note that i have been adding MLP web sites to the blog roll a few at a time. Just scroll down to MLP BLOGS AND MORE and i am listing them alphabetically. My goal is to have them all on here for you so you can source them all from one page which would make life just a little bit easier.