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.
Wednesday, September 26, 2007
The Dow rose 99 points on good volume. Advance/declines were positive. We opened higher, sold off and then came back. There was news about Bear Stearns selling a piece of itself and that was viewed as positive. But think about it. Why would a major brokerage sell part of itself? Because they need to raise money to cover their losses. Eventually the crowd will figure this out. I still say we are going higher though and I am looking at the OEX calls as I've said before. Gold lost 3 bucks today and the XAU dropped around 3 points. NEM got clobbered on some bad news. Volume was very heavy there as well. ABX was down over a buck at one point but came back somewhat. The gold shares needed a rest and they're taking it. GE was up a bit and the volume was nothing special. I'm still waiting for some weakness on GE to get long. The weekly chart looks like it's due for a pullback. The ideal scenario would be to retreat to the up trend line. Mentally I'm feeling fine. At this point it's a waiting game for a decent signal. There's nothing else I can do really. And so it goes. End of the month coming up which could skew things one way or the other. Not much else going on. Sometimes it pays to be patient. It isn't always going to be like it was last month, with huge moves. So you can't expect that to repeat itself and you have to act accordingly. It isn't always easy but it is the smart thing to do.
Tuesday, September 25, 2007
The Dow was up around 20 points today on average volume. Advance/declines were negative. We sold off early in the day and came back. The NASDAQ was stronger then the overall market. It seems to me like we are just hanging around until the next move. I'm keeping an eye on the OEX calls. Gold didn't do much today and the XAU lost over 2 1/2 points. ABX and NEM were both down with the volume nothing special. The gold shares need to take a rest and are doing so. There is so much premium in the options that it doesn't pay to buy them at the moment. GE was up a quarter on light volume. So really there just isn't much going on today. Mentally I'm a bit tired. I have a couple of ideas but in general I feel we are working off the overbought conditions as we prepare to go higher. That is my main prognosis until the data suggest something different. At this point I'm thinking the proper time to get the calls could be the beginning of next week unless a valid signal appears before then. So for now it's patience and a waiting game.
Monday, September 24, 2007
The Dow lost 61 points on average volume. Advance/declines were negative. I'm sticking with the trend is up theory. Declines can be purchased in my opinion. I will be looking to get OEX calls when there is a decent signal. Perhaps this week and maybe early next week. We'll see. I could be wrong. Gold was little changed today and the XAU lost a point. I have an open order in for some ABX puts. ABX was down a touch today. It is way overbought. I think this is the spot where it takes a rest. Gold itself is overblown here also. I do however think that in the longer term, the gold shares will have another run to the upside. But I think for now the recent upside has gotten ahead of itself and it's time for a break. GE lost 40 cents on OK volume for a Monday. I'm still bullish GE into the beginning of next year. I'll be looking to get long as it works off the overbought condition. Mentally I'm feeling fine with a good nights sleep. Options are pricey here due to the roll into the next expiration month. There is no hurry to do anything until a valid signal appears. Patience is needed for now. Not need to force things as there is never a good reason to. Discipline remains key until the next opportunity appears.
Friday, September 21, 2007
The Dow gained 53 points today on better then average volume. Advance/declines were positive. We were up 100 at one point. Options have expired and we are rolling into the next month. The trend is up and I'll be looking to OEX calls at some point. Gold was little changed today and the XAU shed half a point. We are due for a rest here. I have an open order for ABX puts. We are above previous overbought areas that led to declines. ABX lost about 90 cents today on good volume. The problem is that the options have a ton of premium in them due to the length of time before expiration and the recent volatility. We'll see what happens. The dollar has broken down here and there hasn't been a bottom put in yet but I feel that the gold shares will be taking a rest before going higher. That's my guess at this point. GE was unchanged on good volume. The chart is toppy here but I am not looking to get short. I will be looking at the calls on any pullback. Longer term I do think this issue has upside potential barring any negative overall market surprises. Mentally I'm doing OK, although my ideas lately haven't been correct. The plus side is that I never took any positions on them so at least I didn't lose any money. It's not easy to be patient and sit on the sidelines but sometimes it's what you have to do. There are always other trades. I will go over things over the weekend and start again on Monday.
Thursday, September 20, 2007
The Dow lost 48 points on average volume. Advance/declines were 2 to 1 negative. It was a steady, slow moving decline for most of the day. Not the type of decline to trade this late in the option cycle. The market needed to have some weakness and we got it. I think you can buy the dips at this point. We will see new highs in the coming weeks in my opinion. But you never know. Gold continues to be the story and what a story it is. Up again today over $10. The XAU rose another 6 points. ABX was up $2 on very heavy volume. This issue has risen over 33% in 4 weeks! I would have never expected a move like that. NEM was up on heavy volume. The dollar broke to fresh new lows. At some point gold will take a rest but who knows when that may occur? We are so overbought that I really haven't seen anything like this recently. I'd love to short it here but we'll see. The momentum is parabolic at the moment. That never ends well but you can't fight the fact that the price just continues higher. GE was down a quarter on average volume. I think this stock will only be going up from here and will look to the calls on any pullback. Mentally I'm tired as I didn't get a good nights sleep. I don't have any solid ideas at the moment and the charts are not providing me any clues right now. I do think that getting long is the only way to go here, since the Fed just gave the OK for cheap money. You really don't want to fight that. Plus the seasonal effects should start to kick in for the bullish case. It won't be straight up, like it is in gold at the moment. But over time prices should trend higher. That's my guess...
Wednesday, September 19, 2007
The Dow added another 76 points today on heavy volume. Advance/declines were almost 2 to 1 positive. We were higher earlier in the day and managed to hold on to a pretty good gain. I wanted to buy some OEX puts and had to fight myself to sit it out. There is still a chance that I will because I do believe that between now and the close on Friday there will be weakness. But the risk is very high and the timing must be exact. That's a tall order. Gold was higher by $5 today and remains very overbought. The XAU was up 1 1/3. ABX was unchanged on good volume, NEM was higher on heavy volume. I think the run in gold here needs to take a rest. I will be looking to get long on a pullback though. But like the overall market, we are so overbought that a decline is in the offing. GE was up a touch on good volume. Again, it's overbought and has been. Conditions like these don't go on forever. Of course things could remain propped up for the expiration. But sooner or later overbought conditions need to be worked off. Everyone is bullish now so you have to look the other way. Mentally I did not sleep good and am battling myself. As always the real conflict lies within the trader. It isn't easy to do the right thing but that's what must be done. The discipline required is tough to do sometimes. Right now is one of those times for me. I do believe some money can be made here before the end of the week. But it won't be easy...
Tuesday, September 18, 2007
The Dow had its best day in years as the Fed cut rates more then expected. We were up 335 points on heavy volume. Advance/declines were 9 to 1 positive. We have broken out from the near term resistance. You really don't want to step in front of a freight train. My prognosis for buying puts just evaporated. That said, there's always a chance that I might get some on the follow through tomorrow morning. But there is no rush. Perhaps there is still something lurking out there for the Fed to cut more then anticipated. We'll see. Gold soared $10 after the announcement and the XAU rallied with it, up 6 1/2. All the gold shares were up on good volume. I did almost get some puts there today but did not. The technicals pointed to a drop in the gold shares here but they were wrong. In retrospect, it was a consolidation going on and we have broken out above resistance there as well. The dollar fell on the rate cut and that helped gold. There was no inflation in the produces prices and I expect the same tomorrow with the consumer prices. GE had a stellar day, up a buck fifty on heavy volume. It is very overbought here but staying there and continuing higher. The weaker dollar helps there as well. So it looks like up, up and away for the markets from here with new highs coming up. That is what nobody expected. So we'll see. Mentally I'm OK. Got a pretty good nights sleep. I have no imminent trades, perhaps a short tomorrow but I doubt it. Maybe October will be the way to go. Still, you can't deny todays action regardless of the seasonals. So we'll see...
Monday, September 17, 2007
The Dow lost 39 points today on average volume. Advance/declines were 2 to 1 negative. It was down from the start so there wasn't an opportune time to buy OEX puts. Fed tomorrow with producer prices. CPI on Wednesday. I don't think there will be any inflation in the upcoming numbers. If we do get a rally the next couple of days, I'll be trying the puts for the end of the week. But it's all just conjecture at this point. I do expect weakness in a big way at some point this week. There is a lot of premium in the OEX options for some reason. The ideal scenario is up tomorrow, follow through on the CPI Wednesday morning and then get short. Probably won't happen. Gold tacked on another 6 bucks today and is over $720. The XAU was off a third. We have stalled here and I don't know if we are consolidating before moving higher and even more overbought or have built a top and will roll over. The volume continues to be heavy. I was thinking about getting some puts here but now I am not quite so sure. I think that when the Fed eases tomorrow everyone thinks the dollar will tank. But that could very well already be in the market. It will be interesting for sure. GE lost a little ground and the volume was extremely light. It is a waiting game until tomorrow I suppose. I don't know, things really look like they could go either way here. The weak sell signal could have been worked off today. So it's a guessing game and no way should money be put at risk unless something definitive shows up. Once the Fed is out of the way it might get clearer. Or not. Mentally I feel OK. I will say that I've been indecisive here for a while but that is the nature of things sometimes. Having missed the move in gold and no clear signal with the OEX, the sidelines has been the place to be. Perhaps a trade will present itself in the next 4 days or perhaps not. I'm leaning to the short side if we get a pop tomorrow.
Friday, September 14, 2007
The Dow managed to tack on 17 points today on average volume. Advance/declines were positive. We opened much lower and came all the way back, which bodes well for the bullish case. There is a weak sell signal here. But todays action will make me hesitate on the puts for now. That said, I'll be looking at the OEX puts on Monday. I think at some point next week there will be some weakness. It's just a matter of when. Gold didn't do much today and the XAU was up a half. The XAU rallied early and fell back. ABX did as well and I'm looking at the puts there for next week. I don't think there will be any inflation in next weeks reports and gold is due for a rest. If we rally early in the week I might give them a try. I'll need to see the charts this weekend. GE was down a bit on average volume. Hard to make much out of todays action in that issue. Perhaps we are building a small top, that's a guess. At any rate, it will all boil down to the Fed announcement on Tuesday. My guess is a quarter point cut and we'll see where the market goes after that. Anything can and will happen. The summation index is still pointing higher and has been for weeks. You can't ignore that. Todays action was positive going forward. It's a tricky game to play with one week left for the September options. Mentally I'm feeling good. I have a couple of ideas for next week but will need to go over everything this weekend. There is no pressure to do anything so I'll just take it as it comes. I can always sit it out and go to October. I don't think that will happen though...
Thursday, September 13, 2007
The Dow rose 133 points today on average volume. Advance/declines were positive but not like what you would expect for a market up 133 points. The OEX is at 695 and almost ready to take out the recent highs there. I would like to get some puts at 700 but we'll see. If we end up positive tomorrow there could be a legitimate sell signal. But it's hard to buck the trend and the trend is up. This is also a very strong week so far. Gold was off $3 today while the XAU was up 1 3/4. FCX had a stellar day in that index. Both ABX and NEM were down fractionally on light volume. My guess is that we could go higher here but the end of this leg is near. The gold shares could be ready to roll over for a couple weeks here. But I could be wrong. My guess is a sell-off after the Fed announcement. GE had another great day, up 85 cents on good volume. That bodes well for the overall market. We are overbought there though so a pullback in GE would not be a surprise. But it looks like all systems are go for higher prices at the moment. So why would I be looking at the puts? The market will do what it has to. If things look too bullish, a reversal could be in the offing. I think we will sell off after the Fed announcement. That's my guess unless we break out before that, which is possible. Mentally I'm feeling OK. There is not much time left on the September options. We have been higher in the first 2 weeks. That sometimes reverses in the last 2 weeks. However the summation index continues higher and that is hard to fight. I might possibly put in an order for OEX puts overnight. We'll see. Perhaps waiting for Monday is the best plan. There's always tomorrow...
Wednesday, September 12, 2007
The Dow lost 16 points on light volume. Advance/declines were negative. Not much action today but we were up around 50 at one point. I'm sitting tight for now but if the opportunity presents itself, I'll get some OEX puts. Gold didn't do much today even though the dollar fell again. The XAU was up a quarter. I'll be looking to short the gold stocks here. We are overbought and have stayed there long enough. ABX was down 30 cents today on light volume and we could be building a top here for the short term. NEM was up a touch. GE was higher by 40 cents on good volume. GE is at times a proxy for the overall market and todays prices bode well for the bullish case going forward. That's a reason to wait a bit longer on buying the puts on the OEX. I will most likely do it if we get close to 700. But we'll see. It could just be a continued move to the upside. Mentally I'm OK. I'm trying my best not to force things here as we are running out of time for September. I'm thinking we will perhaps sell off on the Fed announcement but that is a guess at this point. We'll have to see how the technicals look when we get there. Anything could happen really. The summation index is still pointing higher and it is hard to contradict that fact. So it's a waiting game for a decent signal. There hasn't been any mention of sub-prime for a while. We also touched $80 for a barrel of oil today but it didn't do anything to the market. So maybe it's just up and away from this point. Doubtful, but you never know.
Tuesday, September 11, 2007
The Dow rose 180 points today on average volume. Advance/declines were over 2 to 1 positive. Where are all the sellers? Could it be that we are sold out? Who knows? Are we going to new highs? The summation index is still pointing upwards. You can't argue with that. Gold was up over $8 today. It is starting to look like a straight line up. That won't go on forever. ABX was up 60 cents and NEM was up over a dollar both on decent volume. These stocks are due for a rest. I will be looking to get the puts here as they build a top. When NEM starts to outperform ABX a short term top is near. That has played itself out in the past. I will get long any pullback though as this breakout is for real I believe. GE was up 35 cents on average volume. Perhaps the calls there should have already been purchased. Mentally I'm feeling OK. My thinking at this point is to let the market run up a bit more here and then short it. That's a guess. More likely we are making a bottoming pattern and the market will be at new highs sometime in October. I could be wrong. The market will do what everyone least expects it to. No one is calling for new highs. So there is a chance that is exactly what happens. But for now there is the September expiration to deal with. We have been moving sideways. If the market was going to drop more then it already has, it would have already. That's my guess at the moment. I do not have any clear short term signals at the moment. There's always tomorrow.
Monday, September 10, 2007
The Dow gained 14 points on light volume. We opened higher, went lower, came back and sold off in the last hour. So it was an up and down day. Advance/declines were negative and the overall market was weaker then the Dow. There isn't a clear signal as to which way we go here. As soon as there is I'll take it. Gold was up a couple bucks. The XAU bounced around and ended close to unchanged. ABX was up, NEM was down and the volume was average. We are overbought here. I would like to short these on any more strength. However the more prudent thing to do could be to wait for a pullback to the breakout point and then get long there. We'll see. GE was up around 40 cents on average volume. I don't trust Monday rallies. GE will do better with a weaker dollar because it does a lot of business overseas. There will be a time to buy the calls I just don't think it is now. Mentally I'm a bit hesitant at the moment. The market could do just about anything here. Less then 2 weeks in this option cycle and a Fed meeting in a week. So it's really not a time to be guessing. If something appears by all means take advantage of it. But don't try and make something out of nothing. Is the sub-prime mess over with? If it is, then getting long is the way to go. But if it isn't, anything can happen. The technicals seem to be pointing in the direction that the worst is over. But that can change. So we are at an interesting point in the road. We'll see what tomorrow brings...
Friday, September 07, 2007
The Dow lost 250 points on a weak jobs report. Volume was average and the advance/declines were 3 to 1 negative. It wasn't a blow out decline and I think we might just grind our way down to retest the lows of last month. That's a guess as always. We didn't close on the lows and actually tried to rally a couple of times. It wasn't a waterfall decline. The technicals have rolled over on a daily basis. Gold gained another $5 and the XAU lost a 1/4. ABX and NEM were up fractionally on good volume. The dollar was weaker, the US economy looks like it's going down the tubes and Osama released another tape. It can't get any better for gold at the moment. I am looking at perhaps getting some puts on strength early next week. We are overbought and have been. A pullback is in order. I still like gold longer term but nothing just goes straight up. A pullback will offer an opportunity to get long again in my opinion. But I could be wrong. GE was down 60 cents on good volume. If it gets back to the weekly trend line that would be the spot to buy some calls. That's the theory at the moment. Always subject to change. Mentally I'm a bit tired with not a good nights sleep. There are 2 weeks left for September options. As always there will be chances to make money. There's also a Fed meeting thrown in there. The summation index is still pointing higher I believe even with todays action. So there's a lot to consider going forward. For now it's the weekend and time for a break...
Thursday, September 06, 2007
The Dow gained 58 points on light volume. Advance/declines were positive. The market was in a holding pattern today, waiting for the employment data. As much as I would like to have a trade on here, there is no clear signal. So I'll have to wait. The story today was gold, which rallied over $13 to cross $700 again. The XAU was up 8 points. The volume was heavy so I have to believe that it is for real. ABX was up 2 3/4 and NEM was up 1 3/4, both on very heavy volume. I put in an order for some NEM calls, in case we get a pullback. It looks like this time could finally be a valid breakout of the weekly down trend line in NEM. If so there will be plenty more room to the upside. Perhaps gold is foretelling a weak jobs number tomorrow. The dollar was weak today and that helped gold. GE gained 60 cents on good volume. It is overbought here but could stay that way. I don't have any trades in mind there unless we get a pullback. GE isn't something that I will chase. Mentally I'm feeling OK. Sometimes it is hard to be patient but not this time for me. I really get the feeling that the decline has seen it's low. We have never really retested it. That could all change tomorrow so we'll see. I did want to get short before the employment report but that has changed. My next guess will be before the Fed meeting unless a decent signal appears. With the summation index still pointing up, it will be hard to be bearish really. But anything can and does happen...
Wednesday, September 05, 2007
Well, so much for the beginning of the month being strong. The Dow lost 142 points today on light volume. Advance/declines were over 2 to 1 negative. I will say this. It doesn't feel as though this is the beginning of something big. When markets go down they usually don't move sideways for most of the day as they did today. The employment report on Friday will be interesting. The summation index is still pointing higher. If we were positive today there would have been a signal to buy the puts. So we'll see what happens. Gold didn't do much today but the volume was good. The XAU lost about a point and a quarter. ABX was basically unchanged. I'd still like to get some ABX calls at some point. But it's probably too late. GE lost a third on average volume. I'm going to wait there. There is no rush for the options that I'm looking at. Mentally I'm feeling OK. I do not have a good feel for the events unfolding it seems but I do believe we have seen the lows. If at some point they get retested, that will be the point to buy calls. My guess at this point is that we won't do much tomorrow and we will see what happens on Friday. Light volume is never a good sign for the bullish scenario. But the market sometimes will do what the majority least expects. I have no problem stepping aside at the moment. As soon as I see something worth taking the risk I'll give it a try.
Tuesday, September 04, 2007
The Dow was up 91 points today on light volume. Advance/declines were 2 to 1 positive. We sold off about 30 points in the last half hour. It looks as though all systems are go to the upside here. It's got everything but the volume. Summation index moving higher and the overall market stronger then the Dow. I might still get short before the employment report but we'll have to see what happens tomorrow. We are almost to my upside target of 700 for the OEX and I'll try a short there perhaps. Gold continues to rally and was up $10. The XAU was up 4 1/4. The volume on gold itself was heavy. Not as much for the gold shares. ABX was up almost a buck. The weekly chart has turned positive. There was a lot of volume in the October 35 calls. It's overbought here on the daily charts but it could stay that way for a while. I will wait for a pullback, hopefully. GE was up slightly on average volume. I'm going to try and be patient there as well. Mentally I'm feeling OK. I did sleep pretty good last night. I am trying to figure out just what could happen here. I checked previous reading of the McClellan oscillator that had the same general numbers as we have had here recently. There is a case to be made for one more run to the downside. There are still 3 weeks for the September options. So I am leaning to a trade involving OEX puts at the moment. So we'll see what happens. This month has a tendency sometimes to be strong in the beginning and weak towards the end. It has happened before. For now it's a matter of waiting for the target and then deciding what to do there.