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Tuesday, September 30, 2008

Up and down as the roller coaster ride continues. A 485 point snap back on the Dow today with good volume. Advance/declines were 4 to 1 positive. Now a deal is coming, supposedly. I'm sure one is, one way or another. What the market does is another issue. It's a tough trading environment to be sure. A lot of premium in the options and whipsaw moves. I'll have to wait on trying the OEX at this point. The risk is higher than usual at the moment. Gold was down $15 on the futures and continued to sell off in the aftermarket. The XAU lost 1 3/4. ABX and GG each lost a couple bucks on decent volume. NEM dropped 1/2. I bought some GG calls. Not completely oversold technically but I wanted to give it a go. I'm expecting the dollar to fall later this week when the employment report is released and the deal is done for the bailout. I could be wrong but that should support gold. The Gold/XAU ratio is still solidly in the buy zone. So we'll see. GE came back and was up around 2 3/4 on heavy volume. The options barely moved considering GE was up 10%. That is what is meant by an overload of premium in the options. If the underlying instrument moves 10% and the options barely move, that isn't the type of situation you want to get into. If and when things settle down, perhaps GE will be a viable play. Earnings out on October 10th there. Mentally I'm a bit tired, did not sleep well. So what happens next? We will get this bailout deal out of the way and then it's back to earnings and data as market movers. The summation index is back in the negative but it's not going to stay there too long in my opinion. So I would guess we go sideways to higher in the coming months. However longer term I suspect we are still in a bear market. But it's all just a guess in the game. And as recent events have shown, anything can happen.

Monday, September 29, 2008

So we are in melt down mode as the Dow lost a record 777 points on what must be extremely heavy volume. Advance/declines were 15 to 1 negative. They rejected the bailout plan in Washington today. So it's the panic of 2008. It's not as bad as 1987 when we were down 22% in one day. We would have to drop 2000 points in a day to equal that. Trust me, the world is not coming to an end. Some type of plan will be enacted and the market will rally back. I'm not saying the the overall trend isn't down for a while. It is. For a couple years maybe. But that doesn't mean it's going to be straight down. How can you profit off of what is happening now is the question. Gold was up $5 on the futures and another 20 after the futures closed. The XAU lost 5 1/4 though. ABX continues to amaze with its relative strength, up 1 1/2 on very heavy volume and was higher than that. GG was flat on heavy volume and NEM lost 1 1/2. Volume heavy there as well. I still like the gold shares and have an order in for some GG calls overnight. However as soon as a bailout deal is done, money will leave gold in a hurry. So it's a tricky play. I have an idea of what I want to do so we'll see what happens. GE lost $2 on heavy volume. Not the crazy volume that we saw last week and that may be telling. I'm looking at the calls there, going out to November. There will be some type of snap back rally in GE between now and then. Timing will be key, as usual. But I think there will be money to be made there. Mentally I'm feeling pretty good, slept well enough. These are interesting times, no doubt about that. However the idea is to make money, so that is what must be concentrated on. There is risk galore, don't deny that. As I've said before there is nothing wrong with waiting things out on the sidelines until we get back to normal. Cash is King. This is a tough trading environment to be sure. However there is also opportunity if you can take advantage of it. Tomorrow should be interesting.

Friday, September 26, 2008

Opened lower and closed higher today for a one day bullish reversal in the Dow. We gained 121 points on OK volume. Advance/declines were over 2 to 1 negative though. So we are still waiting for some kind of government bailout. It will get done it is just a matter of when. The market reaction to that will be telling. It looks like a rally would take place but that 's just a guess. Trying to trade it isn't the smartest thing to do. No decent signal for the OEX as yet. Gold rose around $6 today but the XAU dropped 3 points. ABX was up 1/2, GG lost a buck and NEM fell 1/2. Volume heavy there again. ABX continues to show incredible relative strength among the gold share issues. Perhaps that will have to be the next play. I'll be looking to buy weakness if there is any early next week in ABX or GG. GE was off 1/3 on average volume. Nothing doing there for now. Mentally I'm doing OK. Remained on the sidelines this week and that was the idea. Now next week I will be looking to do something. What that is exactly remains to be seen. The weekly gold share charts will not be looking bullish after this weeks action. So caution is advised. A lot of uncertainty out there on all fronts at the moment. We'll see what happens. Oil was lower today and the dollar a bit higher. Now what happens there after the bailout? A lot of questions but no answers for now. Nothing wrong with waiting it out really but you won't make any money. However you won't lose any either. The weekend is upon us and a break is in order.

Thursday, September 25, 2008

A bailout deal is close was the news today and the Dow rallied 196 points on good volume. Advance/declines were positive. So who knows what happens tomorrow. It's a crazy time in the game. We were up over 300. It is practically impossible to trade the OEX here with all the volatility. As I've said before the normal technicals just don't work. So it's the sidelines for now on the OEX. Gold lost $13 and the XAU fell 4 points today. ABX lost 1 3/4, GG off 2 and NEM dropped 1/2. Volume was pretty good again. I'm still trying to be patient there and todays action shows why. We are still overbought on the gold shares and I will try and wait until next week to get some calls. And even then it may not be the right play. So we'll see where the gold market goes from here. GE was up 3/4 on heavy volume. A lot of premium in the options there at the moment. I'm going to have to tread lightly for now. Mentally I'm doing OK, slept well enough. Patience isn't easy but sometimes it must be done. I would like to let this first week of the option cycle pass and take it from there. So far so good on that count. I will probably wait and see how the market reacts to this bailout before taking any positions. I'm looking to get long the gold shares at some point here as I've said before. I haven't had a decent signal one way or the other in the OEX for quite some time. Eventually that will change. Until then I'll try and sit on my hands.

Wednesday, September 24, 2008

The Dow lost 29 points today on average volume. Advance/declines were negative. It was pretty much a sideways type of day. All eyes are on the Federal government and the passage of a bailout bill. Of course it's being held up while they talk about it for a while. But something will get passed and we'll have to wait and see the markets reaction to that. Gold was up a couple bucks today and the XAU gained 1/2. ABX and GG were up about a buck each and NEM lost 1/2. Volume was good but lighter than it has been. I'd still like to get some gold share calls again for October but there hasn't been a pullback. Oil was weaker and the dollar stronger but GG and ABX continued higher. I'll try and be patient. GE lost 1/3 on good volume. No trades there for now but I'm leaning towards the calls. Mentally I'm doing OK, could have slept a bit longer. So it's a waiting game for now. Not the easiest thing in the world to do but that's where I'm at. If we continue lower in the OEX it will set up a buy signal by Monday. The data releases are taking a back seat to the ongoing debate about the bailout. Interesting times indeed. Technically the market could go either way here. We'll see. The gold shares are overbought but haven't pulled back as of yet. Perhaps they won't. I'm keeping an eye on them. We'll see what tomorrow brings.

Tuesday, September 23, 2008

Continuing lower with the Dow off 161 points on good volume. Advance/declines were over 2 to 1 negative. Waiting for the bailout package from Congress at this point. Summation index lower. Can't really say what is going to happen with the market at this point. It's all a guess as we are in uncharted territory. Anything could happen. Gold lost $17 on the futures but is coming back in the aftermarket. The XAU dropped 4 1/2. ABX and GG lost 3/4, while NEM fell 1 1/2. All had heavy volume again. We're overbought here and I would like to give the gold shares some time before getting long again. The options are full of premium with the volatility and length of time remaining in the October cycle. So it's a sit and wait game for now. GE lost 1 1/3 on good volume but not the crazy kind of volume we saw last week. I'll need to check the chart there. Could be signalling the overall market heading lower. Mentally I'm feeling OK, slept well enough. Well I'm at the point where I'll have to be patient for the gold shares here. The dollar is oversold and was a bit higher today but it could have more to go on the upside, hopefully. Oil pulled back too. The stochastic on the gold shares is overbought, so I would expect some type of retreat. But in this type of environment, anything can happen. Plenty of time, so there's no rush but the entry is going to have to be correct. So we'll see what happens.

Monday, September 22, 2008

The roller coaster ride continues as the Dow lost 372 points on heavy volume. Advance/declines were 4 to 1 negative. The volatility to the extreme continues. Was the end of last week just an expiration related event? Do we now go down to new lows from here? Summation index will turn back to the downside with todays action. I don't have the answers. We are in an unprecedented era for the markets. Time will tell where this all ends up. It's a tough trading environment out there but there is money to be made. Risk is high though. There's nothing wrong with waiting until things return to some semblance of normal. Gold took off to the upside by over $40 today. ABX up 3, GG up 4 and NEM up 2 1/2, all on heavy volume. Incredible moves of over 10% in one day again. I am looking to get some gold share calls again if we get some type of pullback. I really don't want to chase it here. The dollar got pounded today and oil was up over 10% as well. I'm trying not to worry about selling out of my gold position early because it's done and over with. You always have to make adjustments and see things where they are now, not yesterday. There's still money to be made in gold in my opinion. GE lost 40 cents on lighter volume than we've seen lately. The premium in the options is off the charts with all the movement lately. I'll have to stay on the sidelines for now there. Mentally I'm feeling good, slept well. The game plan for now is getting some gold share calls again on any pullback. I'm trying to be patient but you never know. The XAU/Gold ratio is still way out of proportion. It's in the buy zone and has been for weeks. Either gold has to come way down or the XAU has to rise. Gold does not look like it is going to drop anytime soon with all that is going on in the world today. So I'll look to the gold shares for now.

Friday, September 19, 2008

Today the US government changed the rules. It will now bail out everything and everybody in the name of... Really, I don't know. The Dow rallied on extreme volume, up 368 points. Advance/declines were 7 to 1 positive. What a wild week. This should turn the summation index back to the upside. It is hard to trade the indices when things get like this. In fact, it's basically impossible. The volatility is too much. More luck than skill. Gold lost over $30 on the futures, rallied a bit in the aftermarket. The XAU was higher by over 7 points though. ABX up 2 3/4, GG up 1 and NEM up 2. All on good volume. ABX is showing the most relative strength here. I put in an order for some GG calls, was not filled. I may switch to ABX. However I'm waiting for some type of pullback in the gold shares now. GE was up almost 2 on insanely heavy volume again. Too late for the calls here. Mentally I'm tired. Did not sleep much last night. It's been quite a week. Yesterdays volatility in gold led me to get out but there is still more room to go on the upside there in my opinion. The weekly charts on the gold shares look like they have put in a bottom. The weekly OEX chart has put in a hammer bottom on the candlesticks. So the end of the world for the indices has been averted or postponed. It's time for a needed break from all the market madness. I'll be checking things over the weekend and getting ready for Monday. But for now some rest.

Wednesday, September 17, 2008

Volatile days are upon us. The Dow rose 410 points today on what I expect was extremely heavy volume. Advance/declines were over 2 to 1 positive. The market moved up a few hundred points in the last hour on the Treasury secretaries comments of another bailout. Bear market rally? My guess is that it was. A one day wonder until proven otherwise. Gold went crazy again, up $50 on the futures. However it began to sell off on the Treasury announcement. The XAU finished flat and the gold shares had one day reversals to the downside. ABX and GG were off on the day but the quotes are not reliable due to the volatility. Volume was the heaviest that I've ever seen it. NEM lost over 3 points. All the gold shares were higher early and closed much lower on the day. I dumped all my GG calls. Some had a 15% gain and the rest had an 85% gain. I was lucky to get out alive. That said I am looking to buy back the calls cheaper, perhaps even tomorrow. I don't think the rally in gold is over. GE was up 1 1/2 on insane volume again. I'm looking at the calls here on any type of pull back. It may be too late. Due to the volatility the options are very expensive. But I think getting long there will work. Mentally I'm tired and not feeling well. The markets don't care how you feel. It's been a crazy week so far and I suppose tomorrow will be no different. Expiration and we'll see what happens. I'll be checking things tonight but I think getting long gold again is the correct move at the moment.
Another decline today as the Dow lost 450 points on extremely heavy volume. It's a free fall. Advance/declines were over 12 to 1 negative at least. Summation index continuing lower. How low will the market go? Usually lower than you think. It looks like we will go down all the way into expiration at this point. You'd like to think there are some bargains out there but at the moment the world thinks every company is going under. They aren't but to tell where it all ends is impossible. Gold caught fire today as it finally became a flight to safety play. It rose $70 on the futures and continues higher in the aftermarket. The XAU rose over 10 points and is right at the daily down trend line. Another day like today and we will be through it which would be quite bullish. But it hasn't happened yet. ABX, GG and NEM all gained over 3 points on insane volume. It is a crazy time in the markets, I can't emphasize that enough. The GG calls have come all the way back from the dead and there is still over 4 weeks to go. However things can turn around and head back the other way overnight. That's what kind of game it has become. GE lost 1 1/2 on incredible volume. It's a panic sell for sure but you just don't know when it will stop. I would like to get some GE calls and am seriously looking at that as the next play. It's risky though but what isn't at this point? Mentally I'm tired again, did not sleep well. Really would like to get a good nights sleep. I've seen these kind of free falls in the overall market before. You don't want to get long too early. You also want to take the profits if you get any pretty quick. The volatility gets intense. As crazy as it sounds, it's kind of fun too. Well, at least it's not boring. We'll see about tomorrow.

Tuesday, September 16, 2008

Opened lower and closed higher for another one day reversal today. Not that it means anything in a market like this. The Dow was higher by 141 points on good volume. Advance/declines were negative. No follow through to the downside on a closing basis but these are crazy times. Fed stood pat on interest rates and the market rallied. Interest rates won't change the carnage that is happening at the moment. Things will change and be volatile day to day. I'm looking for weakness on Thursday but that is a guess. The sidelines are probably the best place to be at the moment. Risk is high. Gold lost around $6 but the XAU rose 2 1/2. The opposite action of yesterday. ABX up 3/4, GG up 1/2 and NEM up over a buck. Volume heavy again. The gold shares followed the overall market. Oil was down again and the dollar was stronger. Things just aren't following the normal patterns at the moment. Makes for tough trading. GG calls still in the red and probably not coming back. GE opened about $3 lower than where it closed. Amazing. It ended up 1/2 on insane volume again. I can't touch it at the moment in a market like this. Mentally I'm a bit tired, did not sleep well again. Expiration week and volatility at an extreme. I think we'll head back down this week before any stabilization but who knows? Trading in this type of environment is extremely risky. There will be better times to take chances. Yes, the profits now could come quickly but so could the losses. The normal technical analysis doesn't work when we get like this. There is nothing wrong with waiting for a better trading situation.

Monday, September 15, 2008

I'm not going to get into all the bailouts and bankruptcies. All you need to know is that we are in crash mode. The Dow lost 504 points today on what I'm guessing is extremely heavy volume. My volume figures are skewed again. Advance/declines were 15 to 1 negative. Extraordinary times are what these are. Summation index will be gapping lower and who knows how low we will go. Normal analysis just won't work now because it is a catastrophic event. Everything gets sold to raise capital. There will be opportunities to get things cheap. But you don't really know what will survive and what won't. The Fed meets tomorrow and what can they possibly do? It's beyond the level of interest rates, what is going on now. The sidelines is probably the best place to be unless you're short or own puts. Gold is a safe haven and rose over $20 again today. However the XAU didn't join the rise and lost 7 3/4. ABX and GG lost around 2 and NEM around 1. Cash must be raised and the gold shares are a way to raise it. The XAU/Gold ratio continues to be out of whack and I still think it has to get back to normal levels at some point. When that is, I don't know. GG calls still showing a loss but not as much as it would be without the crazy volatility. Nothing makes sense when the markets get like this. Fear overwhelms everything. GE lost 2 bucks on insane volume. It's a panic sell. Will GE go out of business too? I doubt it but who wants to step in and buy it here? Mentally I'm doing as good as can be expected. Did not sleep good last night though. Where do we go from here? I don't have the answers but I have seen collapses before. They don't last forever but they sure go fast when they are happening. Take it down all the way into expiration on Friday? It's possible. Gold rising and the gold shares falling? That's never a good sign of things to come. But who knows? In this type of market anything can and does happen. But usually, it's for the worse.

Friday, September 12, 2008

Once again we opened lower and fought our way back. The Dow was down 150 early and closed with a loss of 12 points. Volume was heavy and the advance/declines were positive. The market is trying to hold up in the face of bad news again. We are going to break one way or the other soon in my opinion. If we continue to the upside early next week I'm going to look at the OEX puts. It is a crazy and volatile time. Gold snapped back $20 today and the XAU rose 11 3/4. ABX and GG gained over 3 and NEM was up 2 1/2. Volume was heavy again. It is unprecedented to see these issues gain and lose 10% in just a day. The gold market had stretched so far to the downside that it is like a rubber band effect and now it is snapping back. Who knows how long or far it will go? We now have hammers on the weekly gold issue candlestick charts which implies higher prices unless we go right back down next week. The GG calls are still in the red but a day like today gives hope that the loss can be cut and something salvaged from this trade. But you never know. The dollar finally sold off today after reaching the 80 level of resistance. GE lost over 1 1/4 on extremely heavy volume. That doesn't bode well going forward if it serves as a proxy for the overall market. Mentally I'm feeling OK, slept well again. These are strange and volatile times in the markets. There are opportunities out there but there is also a lot of risk. Option expiration week is coming up. I really don't know how we have held up here so far but next week could get ugly if there is even more bad news. Perhaps there will be some announcements over the weekend. I'll check the charts over the weekend and get ready for what should prove a volatile week. But for now it's time for a break.

Thursday, September 11, 2008

A one day reversal to the upside as we opened down over 150 points and closed up 165 on the Dow. Volume was heavy again as it has been a very busy week. Advance/declines were negative though, which has me not believing in this move. Short covering ahead of tomorrow is my guess. Volatility is king. I may try the OEX puts but it won't be until next week if at all. Gold continues its free fall, down $17 and continuing lower in the aftermarket. ABX, GG and NEM all gave back what they gained yesterday and the volume remains heavy. This has been a straight down market. At some point there will be a snap back rally and that is where I will dump the GG calls for a loss. Or perhaps there won't be. The Gold/XAU ratio has been blown out and I can't ever remember it staying like this for so long. I guess there is no reason gold couldn't just keep dropping because there hasn't been any support for quite a while. It is overdone to the downside most likely because of the tremendous dollar rally. We've come back to 80 there and that is where multi-year resistance is. I doubt it goes much higher from here. GE was up a touch on very heavy volume after being down over a buck early. Mentally I'm doing OK but could have slept better. Stuck in a losing trade and that is never a good thing. Almost expiration week and we'll see where the bias is. Inflation data and retail sales tomorrow so we'll see what happens.

Wednesday, September 10, 2008

The Dow ended up 37 points on heavy volume again. Advance/declines were positive. We were up over 100 but couldn't hold it in the last hour. I still get the feeling that we are heading lower here soon but I could be wrong. No trades in the OEX here and not much time left for the September option cycle. Gold was hammered down again today, off $30. It continues lower in the aftermarket. However the XAU rose 5 1/4. ABX, GG and NEM were all higher on heavy volume. That is a change from the carnage we've seen lately in the gold shares. This is most likely the bottom for the gold issues. I know I've said that before and been terribly wrong. But when the metal itself is tanking and the stocks are moving higher, you've got to take notice. We'll see what happens. GE lost a touch on good volume. Mentally I'm doing OK. Although I think we are heading lower, there really isn't a clear signal yet. I'll need to be careful since I am already stuck in the losing GG trades. Those trades will not be coming back and it's a cut the loss mode at this point. The Gold/XAU ratio is still out of whack, so I'd like to wait for that to find a reasonable level before closing out the GG trades. So we'll see. There will be opportunities in the OEX though. I'll keep my eyes open but have to be mindful of the risks with only a few days left in the option cycle. Speed will be important. Paying attention will be paramount. Trade numbers and unemployment claims tomorrow. Inflation data on Friday. It should be volatile.

Tuesday, September 09, 2008

It's a crazy market as the Dow lost 278 points on very heavy volume. And it's only Tuesday. Advance/declines were 6 to 1 negative. They tried their best to keep things up yesterday on heavy volume but it didn't work. It has the feel of a market that is going to fall apart. Summation index should turn to the downside here. I don't know what is going on but the selling continues. Gold got clobbered, off $10 on the futures and another $10 in the aftermarket. The XAU lost 11 3/4. ABX and GG off over 2 points. NEM shed over 3. Volume was extremely heavy. I have not seen anything like this downdraft in the gold shares before. The Gold/XAU ratio is in record territory. Carnage. The GG calls are dead. I bought some shares of HL today. I know, I must be crazy. Will the gold shares just go to zero? I don't want to say no but... It's a crazy game. GE lost a buck on heavy volume, reversing yesterdays gains. Mentally I'm doing as well as can be expected. Of course I should have gotten some OEX puts this morning but did not. Staying in a losing trade is costing me more than it should. I have to focus on what I'm in already, which takes away from trying other opportunities. That is something that I really need to work on. In retrospect I should have dumped these GG calls long ago. It seems as though I am making the exact same mistake as the previous trade involving GG. That's never a good sign. What happens tomorrow? Stay tuned.

Monday, September 08, 2008

OK we have a bailout. The US government went in over the weekend to save Fannie and Freddie from themselves. The Dow soared 290 points on very heavy volume. Advance/declines were about 2 to 1 positive. I'd like to say that the decline is over but I believe otherwise. The markets are acting completely out of whack. I still think we will break down from the lows of the summer. I am looking to buy some OEX puts before Thursday. That is the game plan for the OEX at the moment. Could change at anytime. Gold opened higher again and couldn't hold on. It finished unchanged while the gold shares got killed again. The XAU lost 5 1/3. ABX and GG shed another 1 1/2, while NEM lost 1/2. All on heavy volume. It's a broken record to the downside here. All my GG calls are under water. Either gold is going to go way down here or the gold shares are going to have quite a rally. I cannot explain what is happening here with the gold stocks. They have really fallen apart. The dollar sold off early and came all the way back with a vengeance. It's a flight to safety in my opinion and who knows what happens next? At this rate the gold stocks will all be going to zero. GE had a great day, up over a buck on heavy volume. Maybe the market just rallies from here according to GE. I don't believe it yet. Mentally I'm a bit tired, up early and not a good nights sleep. There are things happening in the markets at the moment that I don't have an explanation for. If I had any common sense, I would get out and step aside for a while until things calm down. What normally works for me in the markets, isn't working now. You always have to make adjustments. Whether it's a worldwide margin call or something else, I'm not privy to the information. The technicals aren't working. I don't think the XAU can get any worse from here but I said that a couple of weeks ago too. Gold and oil have stabilized lately but the shares of those two continue to plummet. We'll see where the markets take us tomorrow.

Friday, September 05, 2008

It was another reversal day but this time to the upside as the Dow was off 150 points early, turned around and ended the day up 32. Advance/declines were just about even and the volume was good. We got oversold and have bounced. I don't think that it's anything more than that. The employment report was weak as expected and I guess we got some short covering after the initial sell off. Perhaps we will set up for the next leg down next week. But who knows? Volatility has returned. Gold opened much higher and closed little changed. Oversold and staying there. The XAU had a fractional gain. ABX, GG and NEM were up a touch or unchanged on heavy volume. The first GG calls are in the red and the second are unchanged. I still think it's a buying opportunity for the gold shares here. That said, in this kind of market I'd be happy with break even at this point. Oil is still falling and the dollar continues higher. So the fundamental picture for gold remains negative at the moment. GE was up a bit on average volume. Mentally I'm doing OK. Not exactly sure where we go from here but the downside seems to be the path of least resistance. But we could be setting up for a nice rally in the second half of this month. We'll see. There were not any buyers for anything until today and my guess was that it was only short covering. But I could be wrong. It's time for the weekend, a check of the charts and a break.

Thursday, September 04, 2008

Down hard on the day as the Dow loses 345 points on heavy volume. Advance/declines were over 5 to 1 negative. Most likely the summation index is turning down after today. It feels like another worldwide margin call as everything is being sold to raise cash. How long this will last is anybodies guess. We are getting short term oversold but aren't there yet. Gold lost $5 today but the XAU continues weak, off 5 1/2 points. ABX, GG and NEM were all lower with NEM leading the way almost $2 lower. Volume was heavy again. I bought some more GG calls for October. This didn't work the last time I tried it but the gold shares are so blown out here I had to give it another try. The original GG calls are under water. I think that the gold shares are a screaming buy here. We are seeing a flight to the US dollar on the fear factor. Eventually that should work its way to gold. We'll see. GE lost over 3/4 on good volume. I'm looking at October calls there at some point. Mentally I'm doing OK, did not sleep that well. So it is hard to tell exactly what is going on here at the moment. We had a huge reversal on Tuesday and it has proven to be valid. Everything is being sold. Could it be the beginning of a deflationary period for assets? I don't know. I usually go on the technicals or at least try to. Employment report tomorrow and I can't expect that to be robust. We'll have to see the reaction to it. Perhaps we will remain weak to the September expiration. But I certainly don't know. Tomorrow should be interesting.

Wednesday, September 03, 2008

We were down for most of the day but came back in the last hour to finish up 15 points. Advance/declines were even and the volume was heavy. Summation index still going higher. I think we are marking time until Friday. What happens then is anybodies guess. We could go either way at this point. There isn't a clear signal. I'll be watching and waiting. Gold lost a couple bucks today but the XAU dropped over 4 3/4. ABX, GG and NEM all lost 1 1/2 on heavy volume. There is liquidation of commodity stocks going on in a big way. A commodity hedge fund has failed. I think it's a good buying opportunity but technically the charts look like there is more to go on the downside. The GG calls are now losers. Of course I'm not pleased that I didn't dump them last week but I still think it will be OK with all the time that's left. But I could be wrong and often am. Oil and the dollar didn't do much today. GE was flat on light volume. Mentally I'm doing OK. Volume is back in the market, all the players have returned. I expect to see some fireworks on Friday. Which way we go here is the question. European bank meetings tomorrow. That could affect the dollar. I'll stay with the GG calls for a bit more but anything could happen. So we'll get through tomorrow and go from there.

Tuesday, September 02, 2008

It was a wild way to start the week as the Dow was up almost 250 early on, only to close with a loss of 27 points. Advance/declines were positive but the overall market was lower. Volume was good. It is a one day reversal to the downside but this market has been bouncing around for some time now. I'm on the sidelines with the OEX for now. Gold got clobbered, down $25 and it was lower than that. The dollar was higher and oil lost over $5. The XAU lost 10 points. ABX, GG and NEM all down around $2, with GG leading the way off 2 1/2. Volume was heavy, which isn't a good sign going forward for the bullish case. My GG calls are right back where I bought them. The price gapped down on the open, passing my stop loss price so the order wasn't filled. I'm leaving the order open for now but I might cancel it before the employment report on Friday. In retrospect, I should have been out of this thing last week but the stochastic didn't roll over until today. I might just hold it until October so we'll see. GE was up 40 cents on good volume. Perhaps it is saying that the market will be OK here. That's a guess. Mentally I'm doing OK, slept well enough. Questions remain about this market with todays action. There really hasn't been a decent trend in some time. We had the extended down trend and have moved sideways to slightly higher since. It's a tough trading environment. Plenty of time in the September cycle though. We'll see what tomorrow brings.