Tuesday, February 26, 2008
The rally continues with the Dow gaining another 114 points on good volume. Advance/declines were over 2 to 1 positive. We are approaching the 50 day moving average. We are at the top of the consolidation area. The summation index is moving higher. All systems seem to point to higher prices. We are getting overbought. My thinking is that the next trade is a short from the weekly down trend line. I'll have to wait until we get there. But that could change. Gold continues higher as well, up another $8. The XAU tacked on 2 3/4 points. GG, ABX and NEM were all higher. 1 1/2, 1 and 3/4 respectively. GG continues the relative strength. Volume there slowed down a little. GE was off a 1/4 on average volume. Not sure if that will impact the overall up move. INTC had a good day, up about 3/4. Perhaps the selling is done for a while however I think Big Ben is giving a speech tomorrow. That could have an impact one way or the other. Mentally I'm doing OK. Thinking about getting into gold again but this move to the upside is long in the tooth. However there seems to be nothing stopping the up move at this point even though it is way overbought. Perhaps it can last the March option cycle. We'll see. Otherwise patience is warranted at the moment.