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A Tough Day to Game

The trader outlines all the contingencies you should be thinking about today.
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You want a difficult-to-game day? Well, you have come to the right place. Think about these crosscurrents:

    Month-end always brings markups, but the stocks that were to be marked up have had the stuffings knocked out of them and I don't even know if they can be propped up. S&P rebalancing at the end of a quarter may mean bizarre selling and buying. Every quarter-end is very hard to determine, and this one is extremely difficult to figure out, made more stressful by the prospects of a strange Veritas Software (VRTS) - Get Report add. Julian Robertson hangover: He closes today, does he still have some shorts or longs that he will bang out? Did he do it already? Will he be a factor? Margin clerks might be done for the week. My favorite branch manager weighs in last night with this tidbit: "You nailed it yesterday Jimmy. At the open some folks who were forced to sell sold ASAP. Others sold a portion of their stock to meet margin calls and hoped for higher prices but they didn't get them. When they did not materialize by 2 p.m. we started blowing people out of positions, IF THEY WANTED THEM SOLD OR NOT ... By 3 p.m. all the problem accounts were covered and there was an eerie silence in the branches -- and then the market just screamed." In other words, if margin clerks are finished for the week, then the run from the late afternoon is the real deal. The first bounce might have to be sold anyway because so much money was bet at the bottom that traders will have to take something off anyway. The second bounce may not do the trick either, but after that we might be buyers. Remember though, we bought into the 3 p.m. margin sell, so we don't need to buy. The research lines up as positive, particularly the Morgan Stanley Dean Witter semi call and the Salomon Smith Barney wireless call, but the stocks aren't reacting at all in premarket trading. (I bought Nokia (NOK) - Get Report down from yesterday's close in Finland, although it was not formally mentioned in that call.) Even as the rest of Europe has turned nicely into the black since I arrived three hours ago.

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So we just don't know. Don't trust those futures one bit, not one bit at all. This day is still very much jump ball, especially after these extremely strong personal-spending numbers. (No kidding!) But a Friday short-covering rally after a long decline during the week seems like a pretty good darn bet, based on the history of these five-day bear markets.

James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund was long Nokia and Veritas. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at

jjcletters@thestreet.com.