Monday, December 31, 2007
We ended the year on a downer with the Dow losing 101 points. Advance/declines were negative but not as much as you would expect with a down 100 market. Volume was light. I would like to get some OEX calls here. We are moving to oversold. I expect a New Years rally on Wednesday. But I haven't been right about much lately. If we sell off on Wednesday, I'll get the calls. But more than likely, I've missed it. Gold lost about $5 and the XAU was off 3 points. ABX and NEM were both down on light volume. Gold calls? I'm thinking about it but I think the OEX might be a better trade. We'll see. GE lost 30 cents on light volume. I dumped the calls for another loss which simply added on to the horrible trading year that I've had. Better to start the new year flat with no 2007 hangover trades. Mentally I feel fine although I am not totally sure about the market here. We should have had some type of rally here and we haven't. It is unusual and I don't know what it means really. I do think OEX calls will work here near term. But I'm not 100% sure. When in doubt, stay out? Maybe. It's been a terrible trading year for me but things can't get any worse. It'll be back to the basics and smaller trading size until I can get into a positive trading mode. Focus and discipline must return. I for one am glad to put the 2007 trading year to rest. Time to look forward to 2008. Happy New Year!
Friday, December 28, 2007
Another day of not much as the Dow gained 6 points on light volume. Advance/declines were positive. We are working off the overbought condition. One trading day left in the year. At least there was no follow through to yesterdays downside action. Gold rallied $10 and the XAU gained over 5 points. ABX soared over 2 1/2 on good volume. Who would have figured? Well there was a signal a few days ago and I didn't act on it. I was busy being stuck in a losing GE trade. And that is one of the things that must be corrected in 2008. Losing trades must be dumped. They take away too much attention to what is going on. NEM gained a buck also. The relative strength is in Barrick though and has been at the beginning of the gold share moves. GE was up a dime and I have an order in to sell the calls at a loss. If it isn't filled Monday morning, I'll dump them at the market. Mentally I'm a bit tired. Did not sleep as much as usual. Of course I'm disappointed for missing the move in gold but it's a broken record. You've got to move when the signal appears. There are no excuses. I will still try and make some money on this but have to wait for some type of pullback first. May not come. But that about sums up the terrible year of trading for 2007. I lost roughly 25% of my trading capital and that is a lot. Haven't had a year that bad in quite a while but it happened and you've got to move on. The focus and discipline necessary have to be obtained or it just doesn't work out. It isn't easy but it's not impossible either. It just takes a lot of work and you have to put the time in. There are no short cuts. You really need to stick to the trading plan with no exceptions. I'm going to take it easy this weekend and get ready for next year. It will be better...
Thursday, December 27, 2007
Well it isn't a quiet holiday week as the Dow got clobbered and lost 192 points. Volume was light and the advance/declines were 3 t0 1 negative. Negative moves such as this are not common for this time of year. There were some outside influences as there was an assassination in Pakistan. But still, the market action wasn't typical for a holiday week. Gold was up a couple of bucks but the XAU lost 1 3/4. I would have thought gold would have rallied a bit more considering. ABX was higher and NEM was lower on increased volume. If the gold shares pull back here, I'm getting long. GE held up pretty good, only down 35 cents. The relative strength has been very good lately but I'm still probably gonna dump the calls for a loss and start the new year flat. GE would really have to rally in the next 2 days to keep me in this trade and I doubt that will happen. Mentally I am feeling fine. Slept pretty good. Getting ready for next year. Looking forward to putting this terrible year behind me. Nothing is easy in the game, this much we know. I'm really going to have to regain my focus for the new year and I'm sure I can do that. Success requires discipline and that is what I will work on the most. It isn't easy but it can be done.
Wednesday, December 26, 2007
Another slow day in the markets as the Dow gained 2 points on light volume. Advance/declines were about even. It's a holiday week. We are overbought. I don't expect much one way or the other. Gold had a good day up $13. The XAU rose almost 4 points. ABX and NEM were both up around 50 cents on light volume. Perhaps a sustained move is beginning in the gold shares. The volume is lacking though. I'm on the sidelines but am ready to get long there. Might have missed the signal though. GE was flat on light volume. I'm debating on whether to book the loss this year or see if we get some upward movement in the beginning of next year. There's also the earnings coming out in the 2nd week of January. Probably should just dump it and start the New Year fresh. We'll see. Mentally I'm a bit tired as I did not get a good nights sleep. I'm also trying to take it easy since things are so slow this time of the year. I'm trying but there is always some work that needs to be done. Saw a lot of volume in the GE January calls today for whatever reason. Interesting...
Monday, December 24, 2007
The Dow up 98 on holiday light volume. Advance/declines 3 to 1 positive. The Christmas rally continues. Gold was up a buck and the XAU rose a point. ABX and NEM were mixed. GE was up around 40 cents on light volume. All in all we are overbought here, however the summation index is pointing to the upside. It should be a light volume week with an upside bias. That's my guess for now. Merry Christmas and Happy Holidays...
Friday, December 21, 2007
Better late then never for the Santa Claus rally as the Dow gained 205 points. Advance/declines were about 3 to 1 positive and the volume was good. The OEX call trade would have worked if you waited until late in the week to buy them. Hindsight is always correct. Gold had a good day up $12. The XAU rallied over 6 points. Both ABX and NEM were up over a buck on good volume. Perhaps this was the week to buy the gold share calls. We'll see. GE even was higher by 66 cents and at one point was above 37.50. It sold off at the end of the day though. The volume was extremely heavy. We broke a daily down trend line. That's a positive. I'm still holding the calls, ever the optimist. But I still feel that in reality this trade is going to be a loser. I'm just trying to cut the loss to as small as possible. Mentally I'm a bit tired, did not sleep well. My thinking is that next week will be slow. I'll be taking it easy over the weekend and see where we go from here.
Thursday, December 20, 2007
Up, down, up again today as the Dow gained 38 points on light volume. Advance/declines were positive. We can't seem to gain any traction to the upside here as it has been a sideways to down affair for a while now. The market is oversold but it hasn't meant anything lately. Option expiration tomorrow. No Santa Claus rally yet. Summation index still to the downside. Gold lost a couple bucks and the XAU gained over a half. ABX and NEM were little changed on light volume. The dollar has firmed recently but looks overbought here. The gold shares are oversold also. No trades yet but the long side will be favored when the time comes. GE was up over 1/4 on light volume. Oversold here as well. It will take a miracle for this issue to get near a close of 37.50 tomorrow. I still think it's due for some type of upside here but it hasn't happened yet. Probably won't. The weekly MACD is as blown out to the downside that it could possibly get. I do need to bail out though. Mentally I'm feeling OK. Slept OK. Waiting for an end of the year rally that looks like it will never come. Next week is bound to be slow. And so it goes.
Wednesday, December 19, 2007
Another wishy-washy day as the Dow lost 25 points. Advance/declines were negative and the volume was light. There is no conviction in the market these days with a bias to the downside. Maybe holiday mode has started early. I suppose that with all the uncertainty, people are holding back. Gold lost a couple of bucks and the XAU dropped a point. ABX and NEM both were down on light volume. I'll be patient there. I think that you have to be at this point. GE lost around 20 cents on average volume. We are at 36.62. We will get to 37.50 by the close on Friday? I doubt it. This trade is dead. Mentally I feel OK, got a good nights sleep. I suppose I'll just have to take my losses in GE and look forward to next year. It's really all that I can do. I'm going to have to have more discipline and work harder next year to get back to profitability. This was one of my worst years ever, for whatever reasons. You've got to put it behind you and start fresh next year. I will need to be prepared for the new trading year. So that's what I'll be doing for the next couple of weeks. Getting mentally ready to start the year off right. I'll also take a break since the markets will be thinly traded for the holidays. The market seems to be trading that way already.
Tuesday, December 18, 2007
Up, down and back up again as the Dow gained 65 points on better volume then yesterday. Volume on a daily basis has tapered off from what it was a month ago. Advance/declines were positive. The summation index is still pointing down but I am bullish here. I really think that we are going higher from here. But what do I know? I think that if we hold here you can make a case for a reverse head and shoulders pattern on the daily OEX chart. So we'll see. 3 days left until December expiration. OEX calls again on weakness tomorrow? Probably not. Gold was up 8 bucks today and the XAU rose almost 3 points. ABX and NEM both posted nice gains. I'm starting to think that it might be time to pick up the gold shares. The dollar is overbought and the gold shares are oversold. I'm pretty sure a longer term signal was generated yesterday. We haven't reached the weekly up trend line in ABX yet but if and when we do, calls will be in order. GE rose around 30 cents on average volume. At least it was up when the market acted better. Still need a weekly close of at least 37.50 to stay in that trade. Not there yet. Mentally feeling OK. Got a good nights sleep. Trying to do the right thing here which might be nothing at all. Next week is going to be slow with the market in holiday mode. That will most likely erode the time premium off of the January options. However I do expect some type of pop to the upside in the beginning of next year. So the best course of action at the moment could be inaction. But I've been wrong a lot this year. We'll see. There might be some opportunity to pick something up with the end of the year tax selling. Time will tell.
Monday, December 17, 2007
We gapped to the downside today as the Dow lost 172 points on light volume. Advance/declines were over 4 to 1 negative. Opened lower and stayed there. The summation index indeed did turn around on Friday and now is heading south. I sold the OEX calls at a more then 60% loss. Buy'em Friday and sell them Monday. The market would have to rally over 400 points for those calls to come back. In 4 days. Ain't gonna happen. And so it goes. It's been a terrible year and I suppose that trade just caps it off. Gold was up about a buck but the XAU lost over 6 1/2 points. Again, gold itself and the gold index aren't moving in tandem. ABX and NEM were both down on good volume. I'm still on the sidelines there. GE lost about 40 cents on average volume. I almost just dumped these calls also but GEs relative strength has been pretty good as we've moved lower. Now I don't know what that will mean going forward if we just continue to decline. GE is at 36.48 and it will have to close the week at 37.50 or higher for me to stay in this trade. Mentally I feel OK, got a good nights sleep. It's been a bad year as I look back. The recent OEX trade as a case in point. I certainly could have waited to enter but it is always easy to look back. The discipline just hasn't been there for whatever reasons. You at least have to be in tune with the summation index on the indice trades. But what can I say? I just wasn't good enough this time around. Perhaps next year I will stick to gold and the OEX. I tried some other things this past year and none of them worked. My win % was horrible. That said, where do we go from here? Todays summation action could actually be a buy spike. That would mean that todays momentum will mark the low and we will trade higher from here. It sure doesn't feel like it though. But that's just a guess and my guesses haven't really panned out lately. So we'll see what tomorrow brings and keep an eye on GE.
Friday, December 14, 2007
The week ended on a down note with the Dow off 178 points. Advance/declines were over 3 to 1 negative and the volume was light. The inflation data was higher then expected. We closed near the low of the day. I bought some OEX calls for next week but I'm thinking I could have waited until Monday. We are short term oversold however the summation index might be heading back to the downside after todays action. It's a tricky call. Gold lost 6 bucks today on a stronger dollar. The XAU lost 2 3/4. NEM and ABX were both down on light volume. Gold has lost its luster for the time being. No trades there for now. GE lost over 50 cents on average volume. Unless we get a decent rally in GE next week, this trade is dead and I will be exiting. We closed just below the weekly up trend line and that is not a positive. If however GE can get moving to the upside next week, I'll probably stick around a bit longer. But it doesn't look like it at the moment. Mentally I'm feeling OK. I still have a feeling that we are setting up for a rally into next year but I could be wrong. I didn't like the way we closed today for the bullish case. Monday will be important if things are going to turn around. There are only 5 days left in the option trade I initiated today. That isn't the smartest thing in the world to do. So we'll see what happens. It's time for a break and then check the charts over the weekend.
Thursday, December 13, 2007
Volatility remains as the Dow was down 100 points but came back to finish the day up 44. Advance/declines were about 2 to 1 negative and the volume was average. The inflation data was even stronger then predicted but the market came back. However the signals are mixed at the moment. I did have an order in for some OEX calls but wasn't filled. If we sell off again tomorrow I might try it again. I did think the inflation data would be less then expected and was wrong today. We'll see about tomorrow. Negative advance/declines on an up day isn't the most bullish scenario. Gold lost over $14 today and the XAU fell 5 points. ABX was down over 1 1/2 on good volume. NEM only lost 50 cents on average volume. ABX is beginning to interest me on a weekly basis but I haven't gotten a buy signal in gold yet. The dollar has stopped going down for now also. GE was up a third on average volume and I'm beginning to like the relative strength there. How we close out the week tomorrow will be key once again but it looks like the weekly uptrend line will hold at this point. That could all change tomorrow though. Mentally I got a good nights sleep and feel fine. I do like the way that the market came back today but the breadth wasn't good. However when you get bad news like we did today on inflation and the market shrugs it off, it has me believing that higher prices are in the offing. But you never know. Expiration week coming up and I'll be looking for the positive bias. That said, anything can happen. On to Friday and the CPI.
Wednesday, December 12, 2007
The volatility has returned to Wall Street. The Dow closed up 41 points on heavy volume. We opened up over 200 points and gave it all back and were down 100 points before a late comeback. Advance/declines were positive. I can't say that I know what is going on here. You really would have to take your profits quickly trading the indices. That is if you had any profits. I'm still leaning to the call side for the OEX but I have no trades there at the moment. Inflation data the next 2 days. The expectation is for some big numbers. I don't think that is going to happen but what do I know? Gold was up over a buck but the XAU rose more then 3 1/2 points. These two haven't been in sync lately. ABX and NEM were both up on average volume. Not trades there for now. GE was up about a quarter on heavy volume. It mirrored the market opening much higher and then selling off to be negative. It made a last hour comeback. The options aren't doing much though. Waiting for the weekly close. Mentally I'm tired, slept OK but not enough. Suffice it to say a market that opens much higher and cannot hold its gains just isn't bullish. I have no answers there. Hopefully we will get the selling out of the way here and head higher into the expiration. But that is a guess. It's anything goes at this point. There is nothing wrong with being on the sidelines until things work themselves out. I suppose I will try and be patient and wait for a valid signal. But you never know. So we'll see what the markets reaction to the inflation data is and take it from there.
Tuesday, December 11, 2007
Oh that Fed. They certainly are a market mover. The Dow lost 294 points today on good volume. Advance/declines were 5 to 1 negative. We were overbought and the rally had been on light volume. So to see a decline on the news today was not a surprise. However I did not expect such a dramatic one day move. It doesn't change what I think though. There will be a chance to get some OEX calls this week for expiration. I could be wrong if we just continue to tank out here. But I'd expect some sideways action and then we head higher. Gold turned around to the downside after the Fed as the XAU lost over 6 1/2 points. ABX and NEM were both down around 1 3/4 on good volume. No need to rush into the calls there. Just the opposite I'd expect. GE lost about 50 cents on heavy volume. GE had nothing to say that the analysts liked at todays meeting. It was down well over a dollar at one point. I must say it held up pretty good considering todays overall market action. The volatility threw in a little more premium for the options too. How it closes the week is the key and it's only Tuesday. Mentally I didn't sleep well. I'm also disappointed that I did not purchase some OEX puts before the Fed announcement as well as some gold puts. I was confused on gold for a time but I did expect a decline on the news from the Fed today. I also had previously thought that the OEX puts would not be worth trading on this news but the prices got pretty cheap pre-Fed. We also went right up to a daily downtrend line in the OEX and turned around. I was preoccupied with the GE trade. This I recognize but it doesn't make it any easier going forward. I was looking at the OEX puts but decided to sit tight. That was a mistake. So well see what happens from here. I will get the OEX calls when a signal appears. Even with todays negative action the summation index is still heading higher. I will not try and ignore that.
Monday, December 10, 2007
The Dow gained 101 points today on light volume ahead of the Fed. Advance/declines were almost 2 to 1 positive. We are overbought here and I expect a sell-off after the Fed announcement. I don't think it will be the beginning of anything big. It will possibly be a chance to pick up some OEX calls for expiration week. Gold rose $13 today and the XAU followed, up over 2 points. ABX and NEM were both higher by about 80 cents however the volume was light. Not a lot of volume before the Fed. GE was up around 20 cents on good volume before the analyst meeting tomorrow. Perhaps there will be some good news to propel the stock higher. I hope so for my options sake. Technically speaking, the weekly up trend line in GE has held for now. As long as it holds, I'm staying in the trade. Mentally I feel fine, got a good nights sleep. Tomorrow is all about the Fed and once that is done we will get back to the data. What was interesting about today was the fact that another brokerage had to increase its loan loss yet the Dow was up a hundred. When the market rises in the face of bad news, it's bullish. That's why I feel that even if we sell off tomorrow we will be coming back soon. But that's a guess as always. The market will go where it wants and do what it wants.
Friday, December 07, 2007
It was a day of rest for the market today with the Dow up 5 points on light volume. Advance/declines were about even. We most likely stop going up here for a while as the market is overbought. I think we sell off after the Fed on Tuesday. However I don't think any long lasting declines are in the cards at the moment. Any selling will be a chance to get some OEX calls. I don't think it's worth it to try and play the declines because the trend is up. The summation index is pointing higher. The Employment report was a non-event as the numbers weren't skewed one way or the other. Today gold fell over $6 but the XAU barely moved. Again this index isn't following gold itself which makes it hard to trade right now. ABX and NEM were both off about a half on so-so volume. Sidelines for now. The US dollar has stabilized here lately which means no big moves for gold like we've seen in recent months. GE didn't do much on less then average volume. The options just hung around also. It looks like the weekly up trend line has held for now. But next week could be a different story. There is a GE analyst meeting next week which should be a mover. However it may be overshadowed by the Fed. Time will tell. Mentally I'm feeling OK. 2 weeks left for the December option cycle. I might make another trade this year if something looks good. I'm leaning towards the OEX calls at the moment. The weekend is here, time to check the charts and come up with a game plan for next week.
Thursday, December 06, 2007
It was another positive day on Wall Street as the Dow rose 175 points. Advance/declines were over 3 to 1 positive but the volume was a little light again. I am surprised by the strength of this move. That said I think we are due for a rest. We can't just go straight up from here can we? I doubt it. In fact I wouldn't mind owning some puts right here as we are just about at a daily down trend line on the OEX. Plus the volume hasn't been as robust lately. Employment report tomorrow. I don't have any inkling this month for the numbers. Gold rose $3 today and the XAU followed the market higher by 3 1/2. ABX and NEM were both higher today. The former on average volume the latter on lighter volume. I'm staying out of this market for the time being. I will be getting long again eventually. However when that will be, I don't know. I haven't had a good feel or decent technical signal since the big run-up concluded. GE was up a half on light volume. Perhaps the weekly up trend line will hold. The weekly MACD is so blown out to the downside that I now think that this trade has a chance to work. The options didn't do much today though. So we'll see. Mentally I am a bit tired as I did not get a good nights sleep. Today the Federal government announced a bailout sub-prime package. I'm not here to discuss the merits of this thing. The only thing that is important is the markets reaction to the news. It was positive. It doesn't matter if the plan works or not. You have to respect price movement. Trading is about making money, not whether or not you agree with what the government is doing. We will get another dose of this next week with the Fed announcement. On to the employment report.
Wednesday, December 05, 2007
Back to the upside as the Dow had a nice gain of 196 points, ignoring bad news about credit for a change. Advance/declines were 3 to 1 positive. Volume still looks a little light though. I'd expect tomorrow to be a holding pattern day before the employment report. So the higher price scenario remains in place for now. Gold lost around 4 bucks with the XAU up a half. ABX and NEM were lower, with ABX leading the way. The US dollar is trying to form a bottom and I think that it will for now. So I can't get all that bullish for gold at the moment. There will be a time to get long the gold shares but I don't think that the time is now. I could be wrong. GE was up over 40 cents on again heavy volume. You really would want to see GE up better then that with the market tacking on almost 200 points. That said, the GE RSI indicator is showing a positive divergence with price and that could be a good sign for higher prices. Or not. The options aren't moving much. How it closes out the week will be the key for staying or leaving. At this point it isn't looking favorable on a weekly basis. But stranger things have happened. Mentally I'm feeling OK but didn't sleep as good as possible. Trading is never an easy task. You really need to keep it as simple as possible. And be honest with yourself. If things aren't working you may need to change things. If things are working, you still need to keep a sharp eye on things. The work never stops. You need to be up for it. Lazy won't cut it.
Tuesday, December 04, 2007
Another light volume decline for the Dow as it shed 66 points. Advance/declines were about 2 to 1 negative. Either my scenario for higher prices is going to come true or their is no buying interest and prices will fall much lower. The beginning of the month usually attracts capital and positive money flows. Hasn't happened yet. The summation index is moving higher and prices are dropping. We did have to work off the overbought condition and I believe that is what's happening now. So we'll see. Gold had a good day, up over $12. However the XAU fell a point. ABX and NEM were both down on light volume. Normally the gold shares would have had a good day with a decent rise in gold itself. I certainly don't know what is going on there at the moment. Sidelines for now. GE lost even more ground today, off around 60 cents. The volume was extremely heavy again. Unless we get some type of dramatic turnaround in GE by the end of the week, the recent option trade is dead. Perhaps this is a high volume break of the weekly trend line. It certainly could be. If it is then I would expect the overall market to follow. There's still 3 days left this week but it is beginning to look more and more as if GE is toast for the time being. The weekly indicators are in oversold territory though so you never know. We'll know by Friday though in my opinion. Mentally I'm feeling OK. The market seems to be following what I think it should do here. But that could change in a moments notice. However I have seen in the past where the beginning of December marks a low for the indices and they trend higher from there. I'm not saying that is the case this time around but it could be. Presidential election year coming up along with the markets favorable period. Or it will be the beginning of another bear market. Time will tell.
Monday, December 03, 2007
The Dow lost 57 points today on light volume. Advance/declines were negative. A pullback here is expected and needed if the rally is going to have legs. A positive was the lighter volume to the downside. I'll still remain constructive on the market unless we take out the November lows. I don't think that's going to happen. But what do I know? Gold gained $5 as the US dollar was weaker. ABX and NEM were both up over a half but the volume was light there as well. I think gold may have more room to go on the downside but I'm not sure. I really need to get a better handle on it to make a trade. Sidelines for now. GE was in the spotlight today as it was downgraded by some analyst and got pounded down a buck forty. The volume was extremely heavy. Does it bode ill will for the overall market ahead? Maybe. My hope is that today got rid of all the sellers and we will move sideways and return to the upside. That said, this trade was initiated on a weekly basis, so the end of the week close is what's important here. My options are again in the red but not as bad as I'd expect after a day like today. So we'll see. Mentally I'm a bit tired. Would not be surprised if we see weakness until Fridays employment report. What I don't want to see is a complete collapse from here. A slow steady decline would make me feel the prognosis for higher prices is correct. It's also possible we won't do much until the Fed meeting next week. That's unlikely but possible. So as usual it's a wait and see type of game. I'll be looking for some OEX calls if we get oversold.
Friday, November 30, 2007
We continue higher with the Dow up another 60 points today on good volume. Advance/declines were over 2 to 1 positive. I am surprised as I expected some type of sideways or down action. Perhaps the market is stronger then I realize. Or maybe it was end of the month buying. We will be overbought with another up day on Monday, if that occurs. The NASDAQ was lower today. Perhaps the big caps will be the leaders this time around. I don't know. Gold was lower again today by $13. The XAU lost 1 3/4. Both ABX and NEM were down on good volume. The dollar is trying to stabilize here, even with talk of lower interest rates in the US. So the big run-up in gold is taking a breather for now. GE ended up a touch on heavy volume. It moved around a lot and closed well off its highs. I'm not looking for any big moves up for GE until perhaps the second week of December. The Fed meeting should provide some type of movement. That's my guess at this point. I suppose I'll be holding on to the calls for a while. Mentally I feel OK, got a good nights sleep. My scenario for the OEX calls remains the same. Buy on weakness. We should see some downside next week. That would work off the overbought condition and bring some fear back into the picture. So we'll see. For now it's again time for a break as the weekend arrives. As always I'll be checking the charts and going from there...
Thursday, November 29, 2007
The Dow added 22 points today on lighter volume. Advance/declines were negative. As I said previously I would not expect anymore big upside from here. Sideways to down would be my expectation until we digest the recent gains. Gold lost another $5 today as the US dollar attempts to stabilize. The XAU lost over a point. ABX and NEM were both down on light volume. No trades there for now. GE lost 40 cents on average volume. I'd expect GE to move sideways here as well for a while. The call options are still in the black. There is a chance that I'm going to sell these and try and buy them back cheaper later on. However I'm not completely sold on that strategy. Mentally I did not get a good nights sleep and was a bit sluggish. However with so much time still left on Decembers options, there is no sense of urgency at the moment. End of the month tomorrow so we could get a return of volatility. However for now the game plan remains the same. Look to buy OEX calls on a return to the down trend line that was just broken. The summation index is trying to turn to the upside as it just stopped going down yesterday. There is no hurry to get the calls but that is the way that I'm leaning at the moment.
Wednesday, November 28, 2007
Finally some follow through as the Dow gained over 330 points. Volume was good and the advance/declines were 6 to 1 positive. Huge rallies out of nowhere. I would not expect that to continue. However I do believe the worst is over for now. Today should turn the summation index to the upside. I don't think we will just go straight up from here. We have broken the daily down trend line on good volume. The next expectation would be a return towards that line. When that happens you can get some OEX calls. I will be looking to do that. Gold lost over $13 today. However the XAU rose 5 points in sympathy with the overall market move. ABX and NEM were both up, about a buck and a buck and a half respectively. Volume was OK, nothing special. I suppose that if I expect the market to rally here perhaps gold will go with it. But I'm not sold on that idea yet. Again, I'm not sure about gold here so I'm sitting it out for now. GE was up a buck on heavy volume and that is a good sign for the bullish cause. However we haven't broken the down trend line here as of yet. I would expect GE to pull back with the overall market in the days ahead. Mentally I feel fine, got a good nights sleep. There is still plenty of time on Decembers options. There isn't a rush to do anything at this point. I would expect sideways to down action for the next few days. Then perhaps another push to the upside. But that's a guess. The market will go where it wants.
Tuesday, November 27, 2007
The Dow gained 215 points on good volume. Advance/declines were 2 to 1 positive. I think we are trying to form a bottom here. We really need some follow through to the upside and that just hasn't happened all month. So tomorrow will be important again. We haven't had 2 days in a row to the upside all month. That is incredible considering the time of the year. The money flows are supposed to be positive. So does it mean that the market is in really big trouble going forward? Stay tuned. Gold lost over $12 but the XAU only dropped 1/2 a point as the gold shares took their cues from the overall market. NEM and ABX both came back from their earlier lows of the day. I don't have a clear picture for gold at the moment. However it is obvious that we are not in the straight up bull phase of the previous 3 months. I will check the charts again. GE gained over 60 cents on average volume. My options are back in the black. We'll see how the week closes out. My thinking is that I'll be holding these for a while but you never know. Mentally I'm feeling tired, did not sleep good. It is a strange time in the markets I believe. When a major US bank has to go begging to the Middle East for money, something weird is happening. That's what occurred today for Citigroup. So you have to wonder, what is coming in the future? Time will tell. Whatever the problems are, they will not be solved overnight. There is a sell the rallies sentiment on the street these days. That needs to be overcome before we see some solid gains. When this will occur is anybodies guess but it hasn't happened yet.
Monday, November 26, 2007
Another day in the markets, another sell-off. The Dow lost 237 points on average volume. Advance/declines were 3 to 1 negative. You begin to wonder if it will ever end. And it will, eventually. Oversold and staying there which has been the tune for quite some time now. Summation index is still pointing down. Fridays rally was not to be believed and today confirms that. And on it goes. Gold was up a touch today but the XAU lost over 6 1/2 points. ABX and NEM both lost over a dollar on less volume then we've seen lately. I'm not sure what to do there so I'm staying out. The dollar continues lower. My thought is to short the gold shares but I'm not going to do it just yet. I'm thinking the Fed will not move interest rates lower at the next meeting but if the sock market decline continues unabated they might not have much choice. GE lost almost a buck on average volume. The calls I purchased are under water. How long will I hold them? It really depends on the weekly close. If we close below the weekly up trend line then I will have to exit. This trade was based on that line holding. So we'll see. Mentally I'm a bit tired again. Did not sleep all that well and was woke up early by the phone. The market decline isn't sitting well with me either. There are things going on that are not readily visible. Something is happening under the surface that I can't put a finger on. The market is not acting as it usually would, given the circumstances. But there is nothing that I can do about that. I can only observe and take action based upon what I see. Perhaps we are in the beginning of another bear market. I don't know. Time will tell. There is nothing wrong with staying on the sidelines until things sort themselves out. Preservation of capital isn't a bad thing.
Friday, November 23, 2007
We got the traditional post Thanksgiving day rally. The Dow was up 181 points on very light volume. Advance/declines were 5 to 1 positive. Never trust light volume rallies. My thought is that nobody is believing today is the start of something big to the upside. All the players will be back next week and we'll take it from there. Gold rose over $20 and the XAU tacked on 7 points. NEM and ABX were both up over a buck but again, the volume was holiday light. The dollar fell overseas again. Perhaps that is all the decline that we will get in gold. I'm not sure so I'm on the sidelines for now. GE was up about 50 cents, volume light. I think we need time to build a base here. I already own the calls so it's a waiting game. If we do get a decent pop in the stock, I just might sell and hope to buy back again later. But that's a guess going forward. Mentally I feel OK. It's time for a break and that's what I'm doing. A nice long weekend and back at it on Monday. I will be checking the charts though this weekend. Perhaps some opportunity will be found...
Wednesday, November 21, 2007
Did I say yesterday that I was leaning towards the bullish side? Shows what I know. The down trend continues with the Dow losing 211 points on heavy volume. Advance/declines were about 3 to 1 negative. Oversold and staying there. At this rate it doesn't look like the August lows will hold for the major averages. The Russell 2000 index has already broken through. Have we started a new bear market. I don't know. Time will tell on that. Gold gained around $7 but the XAU lost 2 3/4, following the overall market. ABX and NEM each lost about 1/2 on average volume. No trades there for now as I am not sure which way to go there. I was leaning towards the puts but we are already oversold. I still might get some before the Fed meeting next month but that is a long way away at this point. GE lost 90 cents on heavy volume. Who knew we would get to $37 so fast? I bought some calls there. We are at the weekly up trend line. If we break down here then all bets are off as this is the logical spot to hold. If GE doesn't hold up here it would be ominous for the overall market as well. Do I expect GE to rally here? Maybe but I at least expect it to hold up or move sideways. We'll see. Mentally I'm OK, did not sleep all that well. I'm looking forward to the long weekend that starts now. Friday will most likely be a lightly traded day and it ends 2 hours early. The market is really acting horrible here. Rallies are a thing of the past it seems. However we can't stay oversold forever, can we?
Tuesday, November 20, 2007
The Dow made an impressive comeback in the last hour to finish up 51 points on extremely heavy volume. Advance/declines look like they are slightly negative though. The volatility is strange for a holiday week. It is usually pretty quiet. There is something going on but I don't know what. Technically we are due for a bounce and I mean more then just todays action. We are still oversold. Gold had a stellar day up $13 and is rallying in the after-market. The XAU rose 7 1/2 points. ABX and NEM were both up big on heavy volume. So is that it for the gold correction? I did think that we were in the process of unwinding the gold trade. If that's the case there is a lot more downside there to go. So perhaps we are just snapping back to the broken up trend line. I'm still thinking about some puts when we get there. I'll have to check the charts. GE lost a bit on average volume. It came back in the last hour along with the overall market. I am looking to the calls there but I'm trying to wait until it reaches $37. We'll see. Mentally, I got a decent nights sleep. I'm trying to figure out what is going on here. It looks like perhaps we will hold the August lows. The market is trying to. If it doesn't we will be going much lower. Considering we are very oversold and heading into a favorable positive money flow period, I am now leaning towards the bullish case here. But I could be wrong. At times we are acting as though it is a bear market. I think we are at a point of inflection that will make the case one way or the other from here. Stay tuned...
Monday, November 19, 2007
The downtrend continues with the Dow off 218 points on heavy volume. Advance/declines were 5 to 1 negative. How much longer? Hard to say. There's really no support for the OEX until around 620 where the next weekly up trend line is. But it's possible that we could hold in around here where the low from August is. Summation index still pointing down but we are oversold ans I would expect a bounce soon. You remember that 300+ point up day last week? In bear markets, rallies spring from nowhere but they don't hold. That's what just happened. Gold lost around $9 and the XAU dropped over 8 points. The long gold trade is unwinding. ABX was down over 2 bucks on heavy volume and NEM fell around a buck as well. ABX led the gold shares higher and it is leading them lower. There is talk that the US dollar is stabilizing. We'll see. GE lost 40 cents on average volume. It actually held up pretty well considering. If it gets to $37 I'll think about getting some calls. That's the target for now. If it doesn't hold there then the market is in for much bigger trouble then I expect. Mentally I feel fine. Got a good nights sleep and just went for a pretty good hike. My mind feels clear at the moment. There is an extra week on the December option cycle so there is no hurry to do anything without a pretty good signal. The options are full of time premium. I think we''ll see a bounce sometime this week, after that we'll have to see what happens...
Friday, November 16, 2007
The Dow closed up 66 points on expiration heavy volume. Advance/declines were negative. It was a back and forth day. The market is trying to hold on here. It might, we are oversold. But it also might not. Next week should be slow and light with the Thanksgiving holiday. I think that I will let next week pass and go from there. We'll see. Gold lost a buck but the XAU gained over 2 points. ABX and NEM were both up on good volume. I'd still like to get short the gold shares if they rebound here. But I could be wrong. GE was up a third on good volume. I'm waiting for GE to get to the weekly up trend line and it is about a point away. If and when we get there it will be time for me to own some calls. Mentally I'm doing OK but physically I'm not feeling too good. I'll rest over the weekend and should be fine. I'll be checking the charts over the weekend and taking it from there. The summation index is still pointing down and I don't want to fight that. With the market having a gain today and the declines leading the advances, it doesn't look like the downward pressure for stocks is about to end. We also have broken the weekly up trend line and if we don't hold around here the support is much lower. So I'd be cautious here and I am. But for now it's the weekend and time for a break.
Thursday, November 15, 2007
The Dow dropped another 120 points today on still heavy volume. Advance/declines were 4 to 1 negative. The inflation number was a bit higher then expected. The market held up early and then fell off the remainder of the day. We could not build off of the 300+ point up day on Tuesday. It's not a good sign. The summation index is still pointing down. I suppose we will try and hold Mondays lows at 670 on the OEX. I'm thinking that we will hold for now but that is a guess. Gold got rocked to the downside, off $27. ABX and NEM both lost over 2 bucks on heavy volume. The XAU lost 8 1/2. I will be looking to short any snap back rally that we get there. I'm a longer term believer in the gold shares but they got way overdone to the upside here. I think the dollar will have to stop falling here as well. It is and has been oversold for quite a long time. GE lost 70 cents on average volume. I'm in no rush to get long there just yet. We may have another buck or so to the downside to go there. Mentally I'm feeling OK. I was able to keep myself out of trouble so far this week. I'm getting a better feel for what is going on here although the credit problems are something that I don't know exactly what is happening. But it looks like neither does anyone else. Anything can happen on expiration Friday, so on the sidelines I'll stay. Next week should be holiday slow so there is no reason to start any new trades unless a very valid signal appears. We'll go from there...
Wednesday, November 14, 2007
Well, we tried to stay up today but it didn't work. The Dow rallied early, held its gains for most of the day and then fell in the final hour to end down 83 points. Advance/declines were negative and the volume was heavy again. I had an order in for some OEX puts early but wasn't filled. Tomorrow will be very important. If we close substantially lower, then I think it will signal weaker markets to come down the road. You need to build on 300+ point up days. Today was a one day reversal to the downside. The inflation data was weaker then I expected so I was wrong there. We'll see about tomorrows data. Gold rose $15 today but the XAU managed only a 2 point gain. ABX and NEM were both up about a 1/4 on light volume. The next trade for me at this point will probably be some gold share puts. GE also opened much higher and closed with a loss on average volume. I am going to try and wait for things to settle out there. Mentally I'm OK, got a relatively good nights rest. It is hard to stay out of the market but with 2 days left in this option cycle it is the prudent thing to do. As much as I think that tomorrow will be a down day there really isn't a clear signal. That toughest battle is always within oneself. Discipline is such a hard thing to do sometimes. It follows the overall theme of how tough it is to succeed in this game. But you've gotta keep on going. There will be other trades with good set-ups in the future...
Tuesday, November 13, 2007
There was a huge rally on Wall Street today as the Dow gained 320 points. Advance/declines were over 4 to 1 positive and the volume was heavy. We are right at the daily down trend lines for some indices. This is the area that I would like to get short at but after todays action, I'm not so sure. Yes, there was short-covering going on and it is expiration week. Tomorrow will tell a lot. There should be some follow through. Is this decline over? It could be but we will only know in time. Gold lost $8 today but the XAU followed the market and was up over 4 points. ABX and NEM were both up on average volume. So was it just a one-day washout in the gold shares? I don't think so. I believe that there will be more downside to come there near term. Within the next month or so. I could be wrong. GE gained almost a buck on better then average volume. I think we broke the daily down trend line there and that could bode well for the market overall. Perhaps the decline in GE is over as well. Mentally I'm feeling OK, got a good nights sleep. It looks as though yesterday at the close was the time to purchase some calls. It is always easy to look back though. Going forward is what matters now. I do think there will be higher then expected inflation readings in the next 2 days. What the market does in reaction to those numbers will tell you where we are headed. I'm still of the belief that getting some OEX puts this week will work but you cannot deny the strength of todays rally. So it won't be easy from here. Also with only 3 days left for this month the risk is higher then it usually is. We'll see what happens on the open tomorrow...
Monday, November 12, 2007
Well the market tried to come back. We were up over 100 points but it didn't matter and the Dow closed down 55 points. Advance/declines were over 2 to 1 negative as the overall market was much weaker. Volume was heavy and it was a partial holiday. The market is again in trouble as it was in August. When we are oversold and can't rally, it starts to collapse. I was hoping for a couple of days of rally to get some puts but it doesn't look like that will happen. It is a downside waterfall. Gold got whacked today, down $27. The XAU lost over 14 points. ABX lost over $3 and NEM over $4 on heavy volume. So the run in gold is over for now. We broke the uptrend lines. The next expectation would be to snap back towards the up trend lines that were broken. On that snap back there will be a chance to get short the gold shares. That's my guess at this point. GE lost around 20 cents on average volume. The longer term calls are finally getting cheaper but it isn't the time just yet. Not in a market like this. Mentally I am tired as I did not sleep well. We took out the recent lows at the close and that isn't a good sign. Normally I would be looking to buy any weakness tomorrow. But these aren't normal times at the moment. I do expect some type of decent rally attempt at some point this week because we are that oversold. I don't expect it to hold though. Something bigger is going on here but I certainly don't know what that is. If I'm up for it I will possibly make a trade this week. If not, there is nothing wrong and no money lost by waiting it out...
Friday, November 09, 2007
Well the expected rally never materialized as the Dow fell another 223 points on heavy volume. Advance/declines were over 2 to 1 negative. We had an upside reversal yesterday on extremely heavy volume. If we can't rally off of that then we are in trouble. It seems like a rerun of August as the market continues to decline. Once again there is something going on that can't be explained technically. When an oversold market doesn't rally then we are in collapse mode. I fortunately did not but any calls because the market did not act the way it should of this morning. Gold lost a couple bucks and the XAU fell 2 3/4. NEM hung in there and didn't drop much but ABX lost 3/4. Yes I'd like to short the gold shares but we should get some type of bounce next week and the timing has to be practically perfect. And that is the main problem with any type of trade at the moment. There are 5 days left before expiration. The volatility keeps the options pricey. But the time decay factor will be enhanced as we move forward next week. Options will continue to lose value at a rapid rate if the market does not move in the intended direction. It isn't going to be easy. GE lost 3/4 on average volume. What can I say, the trend is down. We are nearing the weekly up trend line and that will be the key. Will it hold? Doesn't look like it today but next week is a different story. Mentally I slept OK but markets like this take a toll. I've said it before but preservation of capital is important in times such as these. The market isn't acting normally and that has to be taken into consideration. That said there will be money to be made next week. But I probably will not attempt any trades unless the set-up is pretty clear. I still would like to get short before the inflation data but if we don't get a rally of some type before then I will stay on the sidelines. Longer term if the GE options look cheap I will step in. But it's a dangerous market at the moment. Charts will be checked over the weekend. For now it's time for a break...
Thursday, November 08, 2007
It was another wild one on Wall Street as we ended down 33 points on some of the heaviest volume in a while. Advance/declines were slightly negative. We were down over 200 at one point and rallied back in the final hour, even getting positive for a few minutes. We are right at the 200 day moving average for the S&P and it held for now. I would expect some type of rally from here after todays action. There is also a chance that this is going to be the low for a while but time will tell on that. Gold was up $4 today and the XAU almost gained a point. But gold too was all over the place as volatility cranked up. Both ABX and NEM were barely unchanged on heavy volume but they were all over the place during the trading day. I did want to get some ABX puts but did not put in the overnight order. The markets are moving fast right now so the trading is compressed. You've got to take your profits quickly. GE lost a little ground on heavy volume. It too came all the way back from being down much lower. If and when it forms a bottom I will be getting the calls there. Boeing was lower and I was lucky to get out yesterday. Mentally I'm feeling OK, got a good nights sleep. Option expiration next week with some inflation data. I think we'll bounce tomorrow after todays comeback. We should. However what happens after that will be the key. We need to hold todays lows going forward. I still would like to get short ahead of the inflation data but everything is subject to change. I thought that maybe gold was done here today but it came back. Trade data tomorrow and it should be positive for the US. I would think that the dollar would rally but it hasn't regardless of the data lately. So we'll see. Once again there is nothing wrong with preserving capital for later on. There is also nothing gained by sitting on the sidelines. The dilemmas never end...
Wednesday, November 07, 2007
Another one of those 300+ point down days as the Dow lost 360 points. Advance/declines were 10 to 1 negative. I'm sure the volume was heavy but I'll get the numbers here when they come in. We broke 1490 on the S&P 500 and that is negative for sure. Summation index pointing down and accelerating. Probably more to come. We are getting close to the 200 day moving average and will have to hold there or it could get ugly. Gold gained another $10 but the XAU followed the market and was off over 4 1/2 points. ABX and NEM both had one day reversals to the downside on heavy volume. Is it time for the gold shares to take a rest? Who knows? Boeing held up pretty good again considering. It ended down around a half but was up most of the day. I dumped the calls for a small loss. Once we broke support on the S&P 500 there was no reason for me to hold onto this trade any longer. It never worked out the way I had thought and the price movement of the options was confusing to me at least. Can BA rally over the next 7 days? Perhaps but if the market comes back this issue hasn't come back with it yet. GE lost over a buck on good volume. I've still got the long term view that GE will see better days and will be looking to buy some longer term calls soon here. We will let the market sort itself out and take it from there. Mentally I did not sleep well but am feeling OK considering. I'm thinking of getting some gold puts again but I might just wait this out. Preservation of capital isn't a bad thing. It is getting to feel like it did in August, when the market just kept going down for no apparent reason. Yes the volume today was pretty good again but it doesn't look like a blow-off. So there should be more downside to come.
Tuesday, November 06, 2007
We got the expected bounce today with the Dow gaining 117 points. Advance/declines were lagging all day but seem to have come in almost 2 to 1 positive. The volume isn't updated as yet. The market doesn't seem as strong as todays numbers might suggest. But you can't argue with the price movement. Boeing lost around a quarter today and that is bothersome. The market up over 100 and this stock just can't get into gear. It's been that way since I entered this trade. But it was something different and I have now learned to not trade it. If it doesn't perk up here tomorrow it will probably be time to say goodbye. Yes, it's frustrating but it's also part of the game. Gold continues parabolic, up another $12 today. We should break the all time high any day now. The gold shares are moving straight up with the XAU gaining 6 1/2 points. ABX and NEM both higher on good volume as the dollar hits fresh new lows. How long can this go on? Who knows? I should have jumped aboard this train long ago but I'm not about to now. Perhaps it will run up into the November expiration and then take a breather. That area continues to attract money and you can't deny that. GE was another stock that didn't rally with the Dow today as it was unchanged on average volume. You would like to see GE in tune with the markets move and that makes the rally suspect at this point. But tomorrows another day. Mentally I'm feeling OK, got a good nights sleep. We got the expected up move and where we go from here is what matters now. I'm still looking to get short before the inflation reports next week as of now. I will dump the Boeing trade this week hopefully and go from there. It is possible that this is the beginning of a new uptrend also. So there is a lot to play out in the days ahead. The volume was heavy today as it has been lately. There isn't a lot of data to go of this week either. Trade report on Friday. We'll see what tomorrow brings...
Monday, November 05, 2007
The Dow was lower by 51 points today. Volume was heavy again and the advance/declines were over 3 to 1 negative. We were down well over 100 at one point, made it back to positive territory and fell back again. The summation index is pointing down but the McClellan oscillator is getting oversold. I'm guessing we could bounce here. The line in the sand is 1490 for the S&P 500. It held again today but if it fails we will be heading lower. Gold was up a couple bucks and the XAU fell a point. ABX and NEM were both up on good volume. I would love to get some puts here but I've been saying that for weeks. At some point the run in gold will falter. Boeing was all over the place and ended up around a quarter. The trouble here is that it never rallies with the market and the options are running out of time. I should dump the options this week regardless. Again, the option price movement is beyond me, it isn't close to conventional even for options. GE lost a little ground on light volume. I still like the longer term calls here but am not looking to purchase them just yet. Mentally I'm doing OK. Less then 2 weeks now for November options and next Monday is a bank holiday. My thinking is that the inflation numbers will be strong next week so I would like to be short for that. Until then, who knows? We have gotten some dramatic 300+ point down drafts with the last few weeks which keeps everyone on edge. But I believe we will hold up here for now. The market had a chance to sell off in the last hour and it came all the way back instead. That usually isn't the type of action you see when the market wants to go down. So we'll see.
Friday, November 02, 2007
The Dow made a comeback today, up 27 points. I'll get to the volume and A/D's a bit later as there is a delay in the numbers again. We were down over 100 at one point so it's a one day reversal to the upside. Can it last? So far it seems like a rerun of the last 300+ down day followed by a small rally. Perhaps we will build a short term bottom again. The employment number came out better then expected but the results weren't what I thought. Gold soared even with job strength and was up over $14 to climb above $800. The dollar lost even more ground. These themes just seem to go on and on. The XAU was up over 6 1/2. NEM gained over 2 and ABX was over 3 points higher. Both had heavy volume. It is getting to be like a broken record but the money continues to flow into the gold shares. I'm not looking at the puts there anymore and will buy calls on any light volume pullback. This is something I should have done long ago. These issues remain overbought and stay there. 2 weeks left on this option cycle. GE was unchanged on average volume. It mirrored the overall market as it was lower most of the day. No trades there at the moment. BA was up over a buck but the options barely moved. I still cannot figure out the option movement with this stock. It doesn't make any sense. There doesn't seem to be any connection with the underlying issue. Boeing also seems to do better when the market goes down and then doesn't participate in the rallies. The weekly still looks good though with 2 weeks to go but I am getting impatient. Perhaps it's time to dump them and put my attention elsewhere. Mentally I'm a bit tired, did not sleep well last night. I do think that whatever bottom we form here will be a good one and that you can look forward to higher prices in the weeks ahead. That's my guess at this point. The summation index continues to point to the downside so there could be some more volatility in the near future. As always, keep capital preservation in mind. The advance/declines were slightly negative and the volume was heavy. Time for a breather over the weekend. A check of the charts and then back at it Monday morning...
Thursday, November 01, 2007
We got clobbered today as the Dow lost 362 points. Advance/declines were over 5 to 1 negative. The summation index is rolling over but it has been back and forth all week. Tomorrow will be interesting with the employment number. I'm not sure of what to make of things here as it seems to be sub-prime related again. So we'll see. I had an overnight order for ABX puts but wasn't filled. Gold was down a bit today but the XAU lost 7 points. ABX was off over 1 1/5 and NEM lost more then 1 1/4. My theory is the employment report will be stronger then expected, the dollar will rally and gold will fall. That's a guess. Boeing lost $2 and I suppose in hindsight I should have dumped the calls and tried to buy them back cheaper. But who knows? The options don't seem to move much with the underlying one way or the other. Live and learn. GE lost 90 cents on average volume. I am pressed for time today and would like to continue the blog but.... The volume numbers don't look right again and I will post them here in a few minutes. OK, the volume was heavy. We had a day like this a couple of weeks ago and the market was able to hold up. Will it this time? That is the question. I will say this, when this decline is over it will set up for a rally that should last into the beginning of next year. That is my thinking at this point. Mentally I'm feeling OK but am now having questions about this decline. I did not expect a day like this. Tomorrow will tell a lot about what is going on.
Wednesday, October 31, 2007
It was a wild Halloween ride on Wall Street today with the Fed. We were up over 100, then went negative and came back to be up 137 points. Advance/declines were over 2 to 1 positive but the volume was extremely light. So much so that I will need to check and see if the totals that I have are correct. We should get some beginning of the month follow-thru tomorrow. I am thinking of getting some puts before the employment report for a short term trade. We'll see. My gold theory would not have worked as we rose about $8. The gold shares did have great earnings and the XAU was up over 7 points. There seems to be no end in sight. ABX was up 2 bucks on heavy volume and NEM soared over 4 points on extremely heavy volume. I did put in an order for ABX puts but it wasn't filled. I'm now thinking that perhaps that isn't the best course of action here but it does look interesting to me. However the gold shares show no signs of slowing down. They have been overbought for weeks. I might just stick to the OEX for a short trade here. But the trend is up. GE rose around 70 cents on OK volume. It looks like the $40 level is where GE wants to hold for now. We'll see going forward. BA was up 1 1/4 on average volume. I'd expect some weakness here soon as the market takes a breather but I think we are going higher and I suppose I'll be holding on until expiration at this point. Mentally I'm feeling fine. Got a good nights sleep and seem to be thinking clearly. I think we will drop on the employment report and that should be the next play. Maybe. So maybe I'm not thinking clearly. I suppose preservation of capital should come into the mix at some point. I'm still holding the BA trade, it's showing a profit. However if the volume figures are as low as they seem, I'll be looking to get some OEX puts tomorrow. I do not trust light volume rallies. Just got a recap on the volume. It wasn't light as previously reported. It was a heavy volume day. I will have to reassess the gameplan.
Tuesday, October 30, 2007
The Dow lost 77 points today on average volume. Advance/declines were negative. The question is if there's more to come. Probably. I don't know what the Fed will do or how the market will react but there is more to go on the downside at some point this week. I'm guessing they will lower the funds rate by a quarter point. What the market does, who knows? Even if we drop it will set up for higher prices down the road I think. Gold lost $5 today and the gold shares sold off on good volume. Looks like I could be too late there. We'll see with the earnings tomorrow. ABX was down over 1 1/2 and NEM lost 1 1/4. Perhaps we'll get a rally in the gold shares tomorrow, the earnings premium will disappear and I'll be able to get some puts cheap. Wishful thinking most likely. BA was up around 30 cents in a down market, which is encouraging. We were up there over a dollar higher and sold off, which is not. The volume was good. Perhaps today was the sell day and then buy them cheaper in a few days. Looks like I'll be holding them for a while now. We'll see. GE didn't do much on light volume. That's the trouble with GE. A lot of the time it just goes nowhere. It's worth trading if you are in it when it moves but otherwise it sits around a lot. I still like the longer term calls there. Mentally I'm OK. The market is acting as I expect for the time being. I didn't sleep all that well again. What the market does after the Fed tomorrow might provide some clues as to where we go from here. Or it may not. Also have end of month window dressing. So I would expect some volatility. It will be a day to keep an eye on things...
Monday, October 29, 2007
The Dow rose 63 points today on average volume. Advance/declines were positive. We are overbought. We could stay there however at some point this week there will be a decline in my opinion. Perhaps after the Fed announcement or possibly after the employment report. I don't think that it will last long but it could be tradeable. I do think it will happen. The summation index should turn up today but a decline is in the offing this week. We'll see. Gold continues to defy gravity and rose over $5 today. We are almost at $800. The XAU tacked on another 3 points. ABX was up a buck on heavy volume and NEM barely moved. I would like to short the gold shares. This rally cannot go on forever. My thoughts now are to get some puts after the earnings announcements on Wednesday but before the Fed announcement later in the day. It's a risky play but how much longer can we stay extremely overbought? Not much in my opinion. Boeing announced a share buyback and was up a buck on heavy volume. I can get out of that trade with a small profit now. We are overbought here but the indicators have further to go. What other good news can drive this stock? If we decline this week as expected, BA will go with it. Perhaps the options can be bought back cheaper. Or you just hold on until expiration, expecting the overall uptrend in these shares to continue. These are the questions that you face. I'm holding on for now but that could change at any time. GE was up a bit on light volume. Nothing new to report there, a waiting game for the time being. Mentally, I did not sleep well. I'm at a crossroads here where I think we will get a decline soon but the overall trend will resume to the upside. How to play that is the question. There is still plenty of time left in this option cycle. At this point I just might let the Fed meeting pass and go from there. But I am thinking about some OEX puts. Tomorrow should be a waiting game and that is probably the best course of inaction at the moment.
Friday, October 26, 2007
The Dow rose 135 points today on heavy volume. Advance/declines were about 3 to 1 positive. The financials made a comeback and Microsoft was up about 10% on great earnings. The summation index should return to the upside after todays action. We are slightly overbought at this point. I do think we will get some type of decline at some point next week. So we'll see. Boeing didn't move and that isn't the best news with a market up over a hundred points. The weekly chart looks OK for now though. The problem is that we could just get sideways action. That will kill the calls. Gold soared over $16 today. It wasn't so much the dollar as it was international tensions. I think Turkey bombed Northern Iraq. The XAU was up over 5 points. ABX was up 3/4 and NEM had a very good day up almost 1 1/2. The volume wasn't anything special but these issues continue higher. They've been overbought for weeks and the earnings are out on Wednesday. I don't know, maybe there is still time to get some calls but it's risky. My thinking is that I'll have to think about it over the weekend. GE was up about 20 cents on light volume. I still want to get long there but not yet. The best case scenario is for GE to move back to its up trend line. We'll see if that happens. Mentally I'm doing OK. Next week will be interesting with the Fed and the employment report. I do expect a downturn at some point but then I feel that it will be up and away. But that is subject to change. The best I can do at this point is to go over everything during the weekend and come up with a game plan for next week. First a little break until Sunday and go from there...
Thursday, October 25, 2007
The Dow lost 3 points today on very heavy volume again. Advance/declines were slightly negative. The market sold off again today after opening higher and then came all the way back. I don't know what to make of it but buyers are coming in from somewhere. Tomorrow should be interesting. Gold was up another $5 and the XAU rose 1 1/4. ABX and NEM were both up a bit but the volume was light. I did notice a lot of volume on the ABX puts for whatever reason. The gold shares march higher still. Perhaps I should just buy the calls. GE was a touch lower on average volume. It too sold off and came back again. Perhaps it is making a stand here and will not go lower. That's just a guess. Boeing was up 1 3/4 on good volume. This issue can get pretty volatile intra-day. I've just begun to watch it recently and it really moves around. The option prices don't always move with the underlying here, which is puzzling. But it looks good on the weekly if it can close around here tomorrow, so I'll continue to hold it for now. Also Microsoft reported after the bell and it is higher on good volume which should bode well for the overall market tomorrow. Mentally, I slept good and am well rested. It looks like the market will hold up here but looking ahead I would expect some weakness towards the end of next week. But you never know. We have the Fed next Wednesday along with the employment report on Friday. Also ABX and NEM report on Wednesday. So there will be lots of opportunities going forward.
Wednesday, October 24, 2007
A wild day on Wall Street as we road the roller coaster down and then back up. The Dow ended down a point on very heavy volume. Advance/declines were negative. We were off over 200 at one point. Volatility has returned. I still do not expect an extended downturn in the markets here but I suppose anything can happen. The overall market was weaker then the Dow. Gold was up a couple bucks and the XAU was up around a point. NEM and ABX were both up about 1/4 on light volume. The gold shares remain resilient. They continue to attract money. Perhaps I should just buy the calls and forget about it. Boeing had its earnings but I don't think it mattered on a day like today. It was up early and down big during the day. It ended off about 65 cents. I'm going to hold it until Friday and go from there. It moved around a lot today but the option price didn't do much. The earnings premium was sucked out of the options on the open and that is something that I forgot about. Thankfully this is my smallest trade of the year so there isn't much at risk. I want to see the weekly close. GE lost 33 cents on average volume. This issue came back as well after early losses. Perhaps the $40 is the spot to get long. I'm going to give it some more time however to build a possible base here. I could be wrong. Mentally I'm doing OK. Wildfires still going on. You've just got to try and focus. Do the best you can and go from there. I'll check things tonight and go from there. Today was sort of a one day reversal but I'm not completely sold on it. I think we will go sideways at best here for a while. Fed next week along with the gold share earnings. So there is plenty to think about.
Tuesday, October 23, 2007
The Dow jumped 109 points today on good volume. Advance/declines were 2 to 1 positive. We started the day higher, sold off and came all the way back. I doubt we will move in a straight line up here. However I'm not expecting a catastrophic drop as we saw last Friday. I did end up getting some Boeing calls before the earnings tomorrow. It closed unchanged today after moving both up and down. That isn't a good sign with the market up over 100. Technically it looks like a buy so we'll see what happens. I haven't traded this issue before so I may just get out tomorrow one way or the other. Gold was up $3 and the XAU had a good day, up over 5 points. The gold shares really haven't sold off that much but they are trying to. Money continues to flow into this area. ABX was up over 1 1/4 on OK volume. NEM was up over 3/4. The earnings are out in a week. Perhaps I'll try some calls here as well. GE rose 23 cents on light volume. It looks like the $40 level is trying to hold here and perhaps it will. I'm still going to wait on this one though. Mentally I slept pretty good but am still getting distractions from the recent wildfires. Not much I can do about that. You've just got to keep going. We'll see how Boeing reacts to its earnings and take it from there.
Monday, October 22, 2007
The Dow bounced back 45 points today on heavy volume. Advance/declines were positive. We are still pretty oversold. I am expecting more near term upside. After that, who knows? I am really not expecting a dramatic down side move. I think the worst is over but I could be wrong. Gold lost over $8 as the dollar was stronger. The XAU lost over 4 points but came off the lows. ABX was down about 1 1/4 on average volume. NEM was a loser also. The gold shares have been due to drop for quite a while. They finally are. I think it will be a buying opportunity eventually. Earnings are out next week and perhaps I'll get some calls before then. I do believe the earnings will be good if not great. So we'll see. GE was up a touch on light volume. It, along with the overall market, was down early and came back. That is encouraging for the bulls. I am looking at Boeing, BA. The earnings are due Wednesday. It was up over 1 1/2 today on good volume. It is oversold technically. The options did not move that much today, which is puzzling. Also it was right at the longer term weekly up trend line this morning. If it holds, it should move higher. I'm thinking of getting the November calls. Mentally I'm not as focused as I should be. There are wildfires in the city today and I'm not able to concentrate so well. I slept OK but with smoke in the air it's hard to just focus on the stock market. But the market won't wait for me or anyone else. So I'll do the best I can.
Friday, October 19, 2007
Well, so much for buying OEX calls. I didn't, fortunately and it reinforces why you really don't want to try things the day before expiration. Anything can happen. The Dow got clobbered today, losing 367 points and closing on the low of the day. Advance/declines were 5 to 1 negative and the volume was heavy. There was no good reason to try the puts there either since we were already oversold. An expiration related sell-off? Recession fears? Collapse of the dollar? Who knows? These things just don't happen in one day. The daily up trend lines in the indices have been broken. We'll see what happens when we get to the weeklies. I would not be surprised to see an up day on Monday but... Gold held up well again. It barely moved. The XAU lost 3 1/2 points. ABX and NEM were both off around 50 cents on OK volume. Considering the overall market action, the gold shares held up rather well. I'm now thinking that you have just got to own some calls here before the earnings come out. However we are so overbought that it is dangerous. However it seems that money is just flocking to gold and you can't fight that. GE didn't do too bad today, off 75 cents on good volume. It is near one of the weekly trend lines at around 39.75. If that doesn't hold then it's down to 37 and that would be the ideal time to get some calls. That's what I'm waiting for at this point unless price movement dictates otherwise. Mentally I feel fine, got a good nights sleep. The battle here is with oneself, as always. Self control and discipline cannot be over emphasized. The market is a tough game in itself, you don't need to make it any tougher. What went on today, I don't know. I don't think that it will be a repeat of August but I don't know. Perhaps there is something going on again that the market knows but we do not. Next week should be interesting. I think we'll bounce early in the week but that's just a guess. For now it's the weekend and time for a break...
Thursday, October 18, 2007
The Dow lost 3 points on good volume. Advance/declines were about even again. One day before expiration. I really wanted to get some OEX calls for tomorrow but the risk isn't worth it, unless it works of course. We are oversold short term and I expect an up move in the averages either tomorrow or Monday. Who knows, maybe I'll buy some calls on the open tomorrow but I doubt it. We are holding the daily up trend line for now. We were down for most of the day in a sideways channel for the OEX. So we'll see. Gold just continues higher, up over $6 as the dollar hit fresh new lows. The XAU came back over 4 1/2 points and ABX rose around a dollar forty. The volume was good. NEM was up but the volume was lighter. The move here in gold is remarkable. We are overbought and have been for quite some time. I'm about to just get some calls and forget about it. The pullbacks never last. Technically, gold and the gold shares should have corrected by now. They don't and you can't argue with the market. It is always right. GE lost 20 cents on OK volume. I don't anticipate any trades there in the near term unless it really drops. GE is usually a slow mover. If that changes then you know you're on to something. Mentally I'm tired. No good sleep and the work involved here lately has been a lot. But that is no secret and it has to be done to even have a chance. On to expiration.
Wednesday, October 17, 2007
It was a volatile day on Wall Street and we ended down 20 points. The Dow opened strong, up around 80 points. That eroded however and we were eventually down over 100. The daily up trend line was broken for a time. But then the market came back. I did have my eye on some OEX calls at one point but the price did not reach my target. The overall market was stronger then the Dow. Advance/declines were about even and the volume was good. I think we will go higher into the expiration from here. Gold was little changed again but the XAU dropped 3 1/2. I had an overnight order in for some ABX puts but it wasn't filled. ABX lost about a buck and a quarter on heavy volume. NEM was weaker as well on good volume, down over 1.80. The gold shares need a rest and have needed one for quite some time. ABX got more overbought then I've ever seen it and should drop or consolidate for a while. But I could be wrong. GE was up about a quarter on average volume. I'm not expecting much from GE in the near term. However longer term the trend is still up. Mentally I'm doing OK. Did not sleep as good as I would have liked. I suppose I will still be looking at the ABX puts if we get a snap back in the near term. Hard to say with the earnings on tap in 2 weeks. They should be stellar. The consumer prices came in a touch stronger today but the housing numbers were still in the tank. The data suggests that the Fed could cut rates again at the end of the month. We'll see. The summation index is still pointing down but I wouldn't be surprised if we get some kind of snap back after todays action. 2 days before expiration. No need to take any short term chances...
Tuesday, October 16, 2007
We lost another 72 points on the Dow today. Volume was good and the advance/declines were over 2 to 1 negative again. Inflation data tomorrow and we are oversold. So it could get interesting. The summation index is firmly pointing down after today but that doesn't mean we can't snap back. I am looking for a higher then expected reading on the consumer side for inflation but that's just a guess. I actually wanted to buy some OEX calls today since we are about at the daily up trend line that began in mid-August. I expect that line to hold for now. Gold didn't do much today but the XAU lost over 3 1/2 points. ABX was down around 90 cents on OK volume. I would like to get short gold again here as it has had quite a run. It's not going to be easy though. Perhaps the prudent thing to do would be to let it correct and then get long as the trend is clearly up. We'll see. ABX has its earnings report in 2 weeks and that must be considered in the mix as well. Plus the Fed meeting 2 weeks from tomorrow. A lot to digest there for a trade. GE lost a nickel on average volume. There isn't much to do there now except wait for an entry point to buy calls. We'll have to see how weak the market gets here. I'm not expecting much but you never know. Mentally I'm doing OK, slept better last night. I'm trying not to do anything stupid here with 3 days before expiration but you know how that can go. There are conflicting indicators at the moment, so perhaps a change is in the works. I don't know. It could be the so called "sub-prime" dilemma again. Or maybe just bad earnings. So we'll see what tomorrow brings.
Monday, October 15, 2007
The Dow lost 108 points today on good volume. Advance/declines were over 2 to 1 negative. We were down 180 at one point, getting close to the multi-week up trend line. Not sure of the cause but it might turn the summation index lower. We are short term oversold though. Gold was up over $8 today but the XAU only gained 3/4. Regardless I had to dump my ABX puts at a loss as that issue continued stronger, up around 70 cents on good volume. I still want to short this thing but will have to move to a different strike price. Gold itself is moving higher on lower volume and that is never good for the upside in the long run. That said it has been an amazing move in gold over the past 2 months. It's due for a rest but the timing is key. GE lost 20 cents on good volume and it looks as though this one has rolled over for now. I would wait until it gets back to the weekly uptrend line to look at the calls again. It could bounce around this week but it looks to me like the trend is now down for GE. Mentally I'm a bit tired, did not get a good nights sleep. I would have liked to have seen another weak upside day today to get some OEX puts but it didn't happen. I'd like to try something this week but now I'm not so sure. Inflation data on Wednesday, should be a mover. I'll check things over again tonight and take it from there...
Friday, October 12, 2007
The Dow added 78 points today. Advance/declines were positive but the volume was surprisingly light. My thinking is that the bias will be to the upside early next week. But I could be wrong. Gold was down a couple bucks but the XAU rose over 2 points. My ABX puts are under water and I probably should have dumped them today. It's a cut the loss mode at this point. Perhaps I will roll over to November on those. GE had great earnings and sold off around 50 cents at the close. It was down over a dollar early. The volume was heavy. I think that waiting for GE to return to the weekly up trend line and then getting long would be the right strategy at this point. Mentally I'm feeling good. We got the inflation data and the retail sales today. They really didn't seem to matter much. We got a pop on the open and then just hung around all day. Technically, a light volume rally isn't the best thing to see for the bullish case. I might look to buy some OEX puts early in the week before the inflation data on Wednesday. I'll have to check things over the weekend. There are a ton of earnings coming out next week, so there will be opportunities to make money. Getting back to the overall market, the summation index continues higher. It's hard to fight that. There was a chance for it to roll over today but we continued to the upside. Yesterdays one day reversal may not pan out to the downside. So we'll see. It's the weekend and time for a break.
Thursday, October 11, 2007
It was an interesting day on Wall Street with the Dow losing 63 points on heavy volume. Advance/declines were negative. We were up over 100 at one point and then just started to drop. We were down over 100 too. It's a one day reversal which usually means lower prices to come. I have no idea why it happened. Perhaps the inflation data tomorrow will be higher then expected. But it is all just a guess. Perhaps it means nothing and we will continue on our merry way. Gold soared over $10. The trade deficit was lower but the dollar didn't rally and in fact went lower. ABX was higher early but fell back with the overall market and then made a comeback. It was that kind of day. The volume there was huge and ABX lost a dime. The XAU was up over 5 points but ended up only a quarter. I really think we are making some kind of top in the gold shares here. But I've been wrong before. GE lost 40 cents on average volume. I almost bought some calls when it dropped but decided against it. There is a lot of premium left in the options due to the earnings announcement tomorrow. Once that happens the premium will be sucked out of both the calls and the puts. Mentally I'm feeling OK. I actually like it better when the market is volatile. There are more opportunities. Tomorrow should be interesting. We'll see what today was all about. Whether it was a one day wonder or if there is something brewing again. We have the usual positive bias for expiration week upon us, plus earnings. So things could get interesting.
Wednesday, October 10, 2007
The Dow dropped 85 points today on average volume. Advance/declines were barely negative. The overall market was much stronger then the Dow, implying higher prices going forward. We were down around 150 at one point but buying the dips is the mantra for now. Gold was up $3 and the XAU rose 3 points. ABX was up 15 cents on heavy volume as we churned around in that issue today. My puts are under water but I think today would have been the proper day to buy them. Timing is everything. My scenario is that the trade deficit will be better then expected tomorrow and the dollar will rally. If that occurs it should drive the gold shares lower. I am seeing a valid sell signal on the RSI for the XAU here. We'll see. GE lost 20 cents and the volume was light again. It's a waiting game until Friday there. A lot of volume in the $42.50 calls for GE. I'm staying out for now but who knows about tomorrow? I'm not getting a legitimate signal from anything on the charts right now and it looks like it could go either way. The daily up trend is holding for now though. Mentally I'm feeling OK, got a good nights sleep. It seems as though the market just wants to go higher regardless of earnings or anything else. We do get inflation data on Friday, that could be a mover. And we have expiration week coming up. So I think the volatility will pick up here in the near term. I would still be leaning to the long side unless we get weakness in all the indices at the same time. There is still money looking for a place to be invested.
Tuesday, October 09, 2007
The Dow went to new highs again, up 120 points on good volume. Advance/declines were over 2 to 1 positive. The trend is up and staying there. It doesn't seem to matter how overbought we get. The Fed minutes were viewed as a positive so off we go. Enjoy the ride. Gold was up around $5 and the XAU rose almost 5 points. ABX was up over a dollar and my order for puts was filled. The volume in ABX was good. This trade already has the feel of one that isn't going to work. I'm thinking that we have consolidated in ABX and could break out. We'll know more tomorrow. Like the overall market, the gold shares have remained overbought for quite some time. So we'll see. GE tacked on 50 cents but the volume was light. There was a lot of volume in the calls though, so perhaps somebody knows something about the earnings due out on Friday. I'm thinking of getting some calls for that event myself. Mentally I'm a bit apprehensive about this ABX trade. It's my first fill in a while and I'm not feeling good about it. I really think that if ABX continues higher tomorrow, I'm dead. We'll see. Otherwise the overall market looks good. Every minor setback has been met with buying. Perhaps it will just continue to run up into the expiration. The summation index continues higher. Perhaps GE calls are the play for Friday. Time will tell.
Monday, October 08, 2007
It was a partial holiday today for Columbus and the Dow dropped 22 points. The volume was very light and the advance/declines were almost 2 to 1 negative. So you can't take much out of todays action most likely. Gold lost almost $9 and the XAU declined 2 3/4. ABX wasn't down much and the volume was light. I did have an overnight order in for some puts again but it wasn't filled. We could just be moving sideways here but I am still favoring the downside. However this issue, along with the overall market seems to be wanting to go higher. But you can never be completely sure. GE lost 20 cents on light volume. GE seems to just be marking time until the earnings on Friday. I might try something there, we'll see. Mentally I'm tired and did not sleep well last night. We have less than 2 weeks in this option cycle and I would like to take some profits somewhere. The Fed minutes will be released tomorrow and that will be a mover I think. So I will have to be positioned before then, if possible. But you never know. I looked at things over the weekend and believe that shorting gold at this point is the thing to do. The stock market is overbought but staying there and looking like it wants more upside. There are no easy trades out there at the moment...
Friday, October 05, 2007
The Dow rose 91 points today on average volume. Advance/declines were 3 to 1 positive. We were up around 150 on the Dow and got some profit taking late in the day. The employment number was in line with expectations and we rallied. It could have been any number and we would rally because the trend is up. The OEX calls were higher but not that much considering the up move. So on to next week. We should see some follow through early in the week. Gold rose another $4 today and the XAU was up almost 3 points. I'm beginning to think that we are simply consolidating before moving higher here but I'm not sure. The volume continues to come into the gold shares but we are overbought. ABX was up a third on good volume and NEM was up a half. There was heavy volume in the NEM calls. I am still considering the ABX puts and will check the charts over the weekend. It isn't as clear as it was a week ago. GE really did not participate in todays rally and that is not a good sign. It was up 7 cents on light volume. Perhaps it is taking a rest before the earnings next week. You'd really like to see GE up in line with the overall market. So something is going on here. Either the rally isn't to be trusted at this point or GE will not have the earnings that are expected next Friday. It's all a guess. Mentally I'm feeling OK. I have a couple of ideas for the two weeks remaining on Octobers options. Can't feel too confident without going over everything this weekend. I'll try and come up with some type of game plan and take it from there. The summation index continues higher and there really hasn't been any reasons to sell. It's hard to fight that. I think the release of the Fed minutes on Tuesday could be the next real market mover. We'll see...
Thursday, October 04, 2007
The Dow was up 6 points on light volume. Advance/declines were positive. It's a waiting game for tomorrow. The overall market was stronger then the Dow. It has the feel of a market that wants to go higher. The OEX calls are more expensive then the comparable puts. So we'll see. Gold was up $8 and the XAU rose 3 points. ABX was up over a buck on good volume. Perhaps I am wrong and we will just get sideways action in gold instead of a decline. But I'm still thinking if the ABX puts get a bit cheaper that I am going to buy some. NEM was slightly higher on light volume. GE was up just a touch on very light volume. It looks like GE wants to roll over here and the market won't rally much without GE. The earnings are out in a week. Mentally I'm feeling OK. The market is waiting for the employment report and as I said before, I just don't have a good feel for it this month. The ideal scenario for me would be a decline in the market tomorrow into Monday and then get some calls for the OEX. But it's all just a guess at this point as the market will do what it will. I would like to make a trade but at the same time you've got to be patient and wait for a decent signal. It isn't easy to do but that's what must be done. Tomorrows number and the markets reaction to it should provide some near term direction.
Wednesday, October 03, 2007
The Dow dropped about 80 points today on average volume. Advance/declines were negative. Is it the start of something big? I doubt it but you never know. At this point I will probably wait for the employment report and take it from there. If we continue to the downside, I will look to get some OEX calls. Gold was little changed but looks to be selling off a bit in the aftermarket. The XAU lost 2 points. Gold and the gold shares should be taking a rest here. It could last a while. ABX was up a touch today and the volume was good. I don't know what to make of that but I would like to still get the puts there if it rallies a little. GE was down over 50 cents on light volume. Again, it's due to take a rest as the technicals are overbought. So that is where we are at for the moment. There hasn't been any surprises one way or the other here. The market is working off the overbought condition and then I think we are heading higher. Mentally I'm feeling OK, slept pretty good. It's basically a waiting game until Friday and then we go from there. The ideal situation would be for the OEX to come back to the up trend line but that is a best case scenario. Still plenty of time on the options so there is no rush to do anything. I expect tomorrow will be a slow moving, light volume affair. we'll see...
Tuesday, October 02, 2007
The Dow lost 40 points today on average volume. Advance/declines were positive and the overall market was stronger then the Dow. Which implies that we are going higher and I do believe that we are. It's back to buying the dips for now. Gold got clobbered today and was off $17. The signs were there. The XAU shed over 5 1/2 points. ABX was down almost $2. My open order for the ABX puts didn't get filled and I canceled it. There's still a possibility that I'll get some puts here depending on the action from here. But it looks like the divergence in the RSI was for real. GE was pretty much flat on light volume. I still haven't gotten the earnings date there but it's overbought and I'll have to check the charts again. Hard to get the puts there in a market like this. Mentally I'm a bit tired without a good nights sleep. The focus this week seems to be on the employment report coming out on Friday. I don't have a good feel for it like I did the last time. Perhaps I'll wait for it to come out and take it from there but you never know. As always there is no rush to do anything at the moment. I'll check things overnight and take it from there...
Monday, October 01, 2007
A new month and a new all-time high in the Dow. We rose 191 points today on good volume. Advance/declines were 3 to 1 positive. We never got a break to buy some OEX calls at reasonable prices. And so it goes. We are going higher. The summation index continues to the upside. Beginning of the month and quarter money flows are evident. Any pullback can be bought. Gold was up 4 bucks and the XAU rose over 4 points. ABX and NEM were both higher. I do have an open order in for some ABX puts. I do believe the run in gold here is about to take a rest. The technicals are overblown to the upside and have been for a while. It could continue this way but the odds are against it. So we'll see. The dollar won't drop forever either but it could continue lower a bit more in the near term. GE was up 60 cents on heavy volume. This issue too, is very overbought and has been for a while. I don't want to short it though and would look to buy weakness. The earnings are due out at some point in October. Mentally I'm feeling OK, got a good nights sleep. I have no doubts that the trend is higher for US equities. At some point we will take a break and that will give the chance to purchase some OEX calls. I think it will happen this month before expiration but you never know. The premiums are still too high for me at the moment. That will change at some point. In the meantime, patience is the key.
Friday, September 28, 2007
The Dow lost 17 points today on light volume. Advance/declines were negative. We got some volatility in the last hour as the month and the quarter ended. I would still like to own some OEX calls here but not without some type of pullback first. It may or may not happen. Gold soared $10 today to hit $750. The XAU rose about a point and a half but was much higher earlier. I'm thinking it was profit taking for the quarter. ABX was up over a buck on good volume. That said, I am looking to get some puts here. I do believe that the gold shares need more of a rest then we got this week. If we get some strength early next week in ABX I will probably try the puts. There will be a divergence in the RSI if all goes as planned. This is risky though as the dollar hit fresh new lows and shows no sign of turning around. The dollar is very oversold as gold is overbought. So we'll see. GE was flat on average volume. I think the earnings are due out next Friday. They should be pretty good but you never know what the stock will do on the actual report. Mentally I'm doing OK. Slept OK. Will have to check all the charts over the weekend. Beginning of the month and the quarter on Monday and I'm thinking that there will be money that has to be put to work. Employment report on Friday. But for now it's the weekend and a little break is in order. After that, some type of game plan for next week.
Thursday, September 27, 2007
The Dow rose 35 points today on light volume. Advance/declines were 2 to 1 positive. It seems like we are just hanging around here with a slight upside bias. End of the month tomorrow. There isn't much that I can make of the markets action here. I'm on the sidelines until there is a valid signal. Gold was up 4 and change today. The XAU rose over 2 points. Volume was heavy to the downside for NEM again and light on the upside for ABX. Waiting for something there as well. GE was up a touch on light volume. Not much to report today. Oil had a good day up over $2. Mentally I'm tired with not a good nights sleep. It's a waiting game for now. That's all there is to it. You've got to be patient and wait for the opportunity. If we get a pullback it will be a chance to get long. If we continue to rise perhaps a shorting opportunity will present itself. However the trend is up and you don't really want to go against that. So there you have it. It's not very exciting but the market will do what it does and you can't argue with that.