Friday, October 30, 2009
Back to the downside as the Dow lost 250 points to close the month. Volume was heavy and the advance/declines were 6 to 1 negative. This is not the scenario that will help my GG trade but it wasn't unexpected. Yesterday was just an oversold bounce. We closed near the low today so Monday should be interesting. Summation index still heading lower. Volatility has really picked up which should help the option premiums keep their value for a while. Anyway the trend in the overall market has changed to being down instead of up. Stay tuned. Gold sold off early but came back to be down a touch in the aftermarket. The XAU lost 5 1/2 points following the stock market. ABX and GG were down over a buck, while NEM gained 1/3. Volume was heavy. The dollar was higher today and it's possible that we are seeing a multi-week bounce there. Flight to safety trade coming back? Who knows? My GG calls almost got stopped out today but came back as did the precious metal. In retrospect I should have just sold them yesterday and perhaps even at some point today near the close. They are up just a bit. Mentally I'm a bit tired, did not sleep enough. I'm getting the feeling that the market is speeding up here. As in the volatility has picked up so that trades must be done in a shorter time frame. At the rate things are moving I will be stopped out of the GG trade before the earnings come out on Wednesday night. So I will have to come up with a distinct game plan for early next week with regards to this trade. There will be a lot to think about over the weekend. For now it's time for a rest but there's much work to do.
Thursday, October 29, 2009
Well we got the bounce as we were pretty oversold. The Dow rose 200 points on average volume. Advance/declines were 4 to 1 positive. Now the question is was this just a one day wonder? I'm inclined to think so. We will need to move sideways for a while before we head back up again in my opinion. But my opinion hasn't been worth much this year. Another scenario would be to continue the decline in earnest after today. End of the month tomorrow and Monday begins a new one. We'll have to see what kind of money flows appear. Gold bounced as well, up $16. The XAU gained 7 points. ABX up 2 1/2, with GG and NEM tacking on 1 1/2. Volume was a bit better than lately. My GG calls are in the black as the dollar was a bit weaker today. This GG trade is tricky. Earnings are not out until next Wednesday. I don't know if I want to hold on until then. On a daily basis there is room to move up from oversold but the shorter term indicators are already overbought. GG lagged today and that wasn't a good sign. I'll ponder things tonight. Mentally I'm a bit tired, did not sleep well. It was a nice bounce but where do we go from here is the question. Trading never gets easy. I may wait until Monday on the GG calls but I'll have to adjust as time goes on. Perhaps I will have to wait on the earnings. We'll see.
Wednesday, October 28, 2009
Continuing to the downside with the Dow losing 119 points. Advance/declines were 9 to 1 negative and the volume picked up to the downside. Oversold and staying there. I get the feeling that the tone of the market has changed. We should have had some type of bounce by now. Perhaps it is end of the month shenanigans but it seems like something more. Summation index solidly pointing down. Get OEX puts on a bounce? Perhaps. Gold lost $5 and a bit more in the aftermarket. The XAU fell over 8. ABX, GG and NEM were all off 1 1/2 on increased volume. My order for GG calls was filled. The stop-loss order has been put in. Now I'm not so sure I even want to be in this trade. However we are oversold, earnings for ABX and NEM are out tomorrow along with the GDP report. That may not mean anything though if we continue to slide. The dollar has found some buyers lately too. I may be exiting this trade sooner rather than later. Mentally I'm feeling OK. I am determined not to lose more than 50% on any trade from here on out. This had been implemented before but I would override it. No more. This will save me from the inevitable huge losses that occurred when I couldn't admit that I was wrong. The market goes where it wants and I think we're witnessing that right now. Tomorrow will be key. Deeply oversold and we need to see some upside.
Tuesday, October 27, 2009
Kind of a sideways type of day as the Dow gained 14 points while the overall markets were weaker. Volume was average and the advance/declines were negative. Summation index still pointing lower. Oversold here so I would expect at least some type of bounce soon. GDP on Thursday and that will be a mover in my opinion. Is it too late for some OEX puts? we'll see. Gold lost $7 in the futures market but came back a bit in the aftermarket. The XAU lost 2 1/4. ABX and NEM were flat, while GG lost 3/4. All on average volume. Earnings on Thursday as well for ABX and NEM. The dollar had a slight gain today. Oversold on the gold shares here and that has been a buying opportunity for the past few months. I'm leaving in an open order for the November GG calls. Mentally I'm doing OK, slept well enough. We are getting very oversold on the McClellan oscillator and I would expect at least some type of bounce soon. I'm getting the feeling this decline may be more than what we have seen lately but I've been consistently wrong this year. This could just be an end of October phenomenon. We'll know soon enough.
Monday, October 26, 2009
A weak start to the week as the Dow lost 104 points. Advance/declines were about 3 to 1 negative and the volume was average. Getting to oversold here but the summation index is still pointing down. Is this the expected correction that I've been looking for? I've said that before. The overall trend is still up for now but that could change. We've got the end of the month coming up at the end of the week. I think the GDP number this week will be the biggest data point. No OEX trades for now. Gold took a hit, down $13 on the futures. The XAU lost 6 1/2. ABX, GG and NEM all lost around 1 1/2 on average volume. ABX and NEM earnings out on Thursday. The dollar was higher today. There is a lot of talk about the dollar beginning to rally here, for whatever reasons. This happened a few weeks ago as well and then the dollar hit fresh lows. I did place an open order in for some GG November calls. We'll see what happens. Oversold in the gold shares here. Mentally I'm feeling OK. Trying to gauge if this is the time to make a trade. The open order that I have placed is much lower than where the option price is at the moment. Not much risk in leaving it open for now. We'll see what Tuesday brings.
Friday, October 23, 2009
Back to the downside as the Dow lost 109 points on average volume. Advance/declines were 3 to 1 negative. Moving sideways for now and deciding which way to go I suppose. Summation index still pointing down. Can't say I have a good feel for what's about to happen here but I'm leaning towards the lower prices argument. But who knows? We'll see the reaction to the data out next week. Gold lost a couple bucks as the dollar had a bounce. The XAU lost 2 points. ABX, GG and NEM were all fractionally lower on light volume with GG leading the way. Some earnings out next week. I may try the gold share calls next week. Just about getting to short term oversold there. I'll mull things over the weekend. Mentally I'm doing OK. On the sidelines and rewriting my trading rules. Still 4 weeks on the November options so this was a good week to just sit tight. I'll be checking the charts for the next couple of days and take it from there. For now it's time for a break.
Thursday, October 22, 2009
Back to the upside as the Dow climbed 132 points on average volume. Advance/declines were positive. The summation index rolled over yesterday so todays market action is puzzling. My inclination is to not believe the rally but that hasn't been the case for quite some time. We are still in a sideways channel here for the major indices. No trades on the horizon at the moment in the OEX. Gold lost $5 today as the dollar stabilized. The XAU didn't do much. ABX, GG and NEM all had fractional losses on light volume. If anything, I might try the gold share calls. Earnings out next week for ABX and NEM. We'll see. Mentally I'm feeling OK. It looked to me as though the Dow was stronger than the overall market today. The advance/declines were not as strong as you would expect for a market up over 100 points. Perhaps it's a warning sign. So I'm really in no hurry to put on a trade here. I'm going over my trading rules and will be making some changes. That is something positive, hopefully, that has come from this years trading account carnage. We'll get through Friday and go from there.
Wednesday, October 21, 2009
The Dow fell apart in the last hour and closed with a loss of 92 points. We were higher for most of the day. Volume looks a bit better than lately and the advance/declines were negative. Perhaps the summation index is about to fall off of the ledge. Time will tell and it will tell soon. We are long overdue for a sustained decline. But who knows? we could turn around tomorrow. Still overbought on a medium term basis. Gold was up $5 on the futures but the XAU was little changed. ABX, GG and NEM had fractional moves one way or the other on average volume. All were up over the course of the day and sold off near the end of the day as well. I'm looking at the gold shares but no trades are imminent. The dollar hit fresh lows and that is the same old story. Mentally I'm a bit tired, could have slept better. No rush to trade here as my many losses this year have caused me to re-evaluate my trading methods and I'm in the process of coming up with some changes to my rules. Following the rules is tougher than making them. However the discipline that has been lacking in my trading this year must be addressed. As well as the excessive risk taking. I'm working on it.
Tuesday, October 20, 2009
The Dow lost 50 points today on average volume. Advance/declines were 2 to 1 negative. We're moving sideways at the moment. Is it a pause before we move higher? That's been the case for quite some time. We are almost at some important long term down trend lines. We will need to see volume pick up in order to break through them. I'm not sure that will happen. The summation index is moving sideways here as well, possibly forming a ledge. The market usually breaks down if that is the case. Hasn't happened yet. Gold was flat on the day, while the XAU lost almost 4 points. ABX, GG and NEM were all down around a buck on light volume. The dollar was higher today. There's nothing to suspect that the up trend in gold is in danger at the moment. I'd like to get long the gold shares at some point. Mentally I'm feeling OK. No rush to take any positions. I'd have to get a good signal one way or the other in order to do something. Not that the signals I follow have worked out for me this year. I'm on the sidelines until further notice.
Monday, October 19, 2009
The market continues to climb as the Dow gained 96 points. Advance/declines were about 3 to 1 positive and volume looks to be a bit light. We are at some long term weekly downtrend lines in the major indices. If we break through to the upside, it's going to be more of the same up, up and away. Hasn't happened yet but at this rate, nothing is bothering the market. We'll see what happens this week. A lot of earnings reports due out. Gold was up $6 and moved higher in the aftermarket. The XAU gained 1 1/2. ABX, GG and NEM all had fractional moves to the upside on light volume. The dollar hit fresh lows. This song and dance remains the same. Again I wonder that this can't go on forever. But it is for now. No sense in fighting the trends. Mentally I'm feeling OK, slept well enough. No trades on the horizon. An extra week in the November option cycle. We remain overbought and that hasn't produced a sustained drop in quite some time. So I'll be on the sidelines until further notice. Perhaps try something in gold if we get a pullback. But I've said that before.
Friday, October 16, 2009
A little downside today as the Dow lost 67 points on expiration Friday. Volume was average and the advance/declines were negative. We got some poor earnings reports from IBM and GE. At least they were viewed as poor regardless of what the numbers were. We were way overbought anyway. Summation index is moving sideways at this point. I can't say that I have a good grasp of what is going on, as I have had many losing trades this year. We can't stay overbought forever though. Gold was flat and so were the gold shares. The XAU was up 1/2. ABX, GG and NEM had fractional moves one way or the other. Volume was nothing special. The dollar was up a touch. Gold is overbought as well. I'd still like to get long here at some point. Mentally I'm feeling OK, slept well enough. Another expiration has passed as we move to the November cycle. There is an extra week on the November options, so I'll be in no rush to put on a trade. I may be done for the year anyway. I'll look over things this weekend and go from there. It's time to take it easy and enjoy the weekend.
Thursday, October 15, 2009
Moving yet higher as the Dow gained 47 points. Advance/declines were about even and the volume was average. Overbought on a short and medium term basis. The summation index is starting to move to the upside. I can't imagine that this can last much longer but I've been wrong all year long. Expiration tomorrow. Gold took a drop today, down $14 even with the dollar a bit weaker. The XAU fell 3 1/4. ABX, GG and NEM all lost around a buck or so one way or the other. Volume was light. The inflation data today was benign which doesn't help the price of gold. It's been quite a run in gold as well. Mentally I'm feeling tired, did not sleep well. No trades on the horizon as I could be done for the year. Possibly breaking through to the upside of long term weekly downtrend lines. I'll need to check the charts. Volume hasn't been anything that great on this rise but you cannot deny the price movement. We'll see how we close out the week.
Wednesday, October 14, 2009
The Dow took off to the upside today, gaining 145 points on average volume. Advance/declines were 3 to 1 positive. I dumped the OEX puts for yet another loss. It was around an 80% loss. This is shaping up as my worst year ever, since the early days when I did not have a lot of money and would blow up my account on a regular basis. Overbought and staying there. It looks like we are breaking a long term downtrend line on a weekly basis. That is bullish. Just how high can we go? Gold was flat and the XAU as well. ABX, GG and NEM were little changed on light volume. The dollar continued lower today. Inflation data out tomorrow morning. The gold shares did not participate on the upside today and with the dollar weaker that is a surprise. We'll see what happens tomorrow. Mentally I'm a bit tired, did not sleep all that well. It was another losing trade closed today. The story of my year. I'm down over 30% so far for this years trading. That could be it for me this year. Nothing is working at the moment. It's only the middle of October. I guess I'll have to take a step back and re-evaluate where to go from here. My confidence is shot at the moment. That doesn't help things. We'll see what happens tomorrow but we can't go up forever, can we?
Tuesday, October 13, 2009
We sold off early and came all the way back today as the Dow lost about 15 points. Volume was average while the advance/declines were negative. 3 days to go and my OEX puts are running out of time. However I am committed to waiting for Thursday at this point. Some data out tomorrow including the FOMC minutes. Still overbought here but that hasn't meant anything lately. Intel earnings after the bell today as well. We'll see. Gold continues with its breakout, up another $7 on the futures. The XAU rose 3 points. ABX and GG were up about 1/2 on average volume. NEM rose a bit over a point. The dollar fell again today. Everyone seems to want to be long gold now. That won't last forever. No mistaking that I missed that move though and had plenty of chances. Mentally I'm feeling OK. I'm somehow still believing in this OEX trade but time is running out. However I've been wrong so many times this year it could just be another false hope. I'll know in the next couple of days.
Monday, October 12, 2009
A somewhat quiet Monday as the Dow gained 20 points. Advance/declines were positive and the volume was light. I almost bought some more OEX puts today. This has been an extremely light volume rise over the past 6 days. I do not trust it to be real. My OEX puts are losers but I do believe we will be getting a decent decline between now and the close on Thursday. I purchased too early. That's my belief at the moment. Now I could be wrong and we could break out to new recovery highs again. We'll see what happens going forward. Gold continues higher as the dollar dropped today. The precious metal was up $8 today but the XAU lost 1/3. ABX, GG and NEM were all about unchanged on light volume. Overbought here but that hasn't meant anything for gold lately. I'd like to get long if we get a pullback. Mentally I'm feeling OK, slept good. The stock market is short term overbought here and just about medium term overbought as well. I really think puts are the way to go this week, even with the expiration positive bias factor. Today was a partial holiday so we'll see how things go tomorrow when all the players have returned. No real data until Wednesday. 4 days to go on the October option cycle. I suppose that I am going to hold these puts until Thursday barring some blow-off rise tomorrow. Anything can happen in this game.
Friday, October 09, 2009
The Dow closed at the high of the day and high for the week. The Dow was up 78 points on light volume. Advance/declines were positive. My OEX puts are in the red. Too early I suppose. There's a bank holiday on Monday as well. I am still not a believer in this advance in the Dow. The volume is light. I could be wrong and probably am considering the year I've had. Short term overbought here now but that doesn't mean that it can't last another day or so. This trade is in trouble. Gold lost a bit today, down $7. The XAU lost around a point. ABX, GG and NEM all had fractional losses on light volume. That implies that the trend is still up. The dollar had a good day but the gold shares did not sell off that bad. Overbought here as well but perhaps the gold shares will move higher for the October expiration and I'm afraid that the overall market could do the same thing. Mentally I'm feeling OK. I'll need to figure out where to put the stop loss order in for this OEX trade so I don't get completely killed again. It's frustrating but what can you do? Expiration week is upon us and it usually has a positive bias in the beginning. I smell another losing trade. It's the weekend and I'll check the charts and go from there. Time for a rest.
Thursday, October 08, 2009
The Dow gained 61 points today on average volume. Advance/declines were almost 3 to 1 positive. We are getting short term overbought but that doesn't mean we can't stay there. However, I did purchase some OEX puts today. I believe that the volume so far this week has been light and we will roll over to the downside. The summation index did move back to the upside today and that could be a caveat. So we'll see what happens. The ideal scenario would be to hold these puts until expiration. Gold had another good day and continues to make record highs. It was up over $10. The XAU gained 2 1/2 points. ABX, GG and NEM all had fractional gains on average volume. I would have thought that these issues would have done better considering the move in gold. The dollar hit a fresh new low for this downside leg in the index. That looks like it was the trade to be in really. But what can you do? Gotta keep moving on. There will be other opportunities there. Mentally I'm feeling pretty tired. Did not sleep enough. Well, now I'm in another trade and hopefully I'll manage it better than the last one. The market will do what it wants. 6 days on the October option cycle. We'll see how it goes.
Wednesday, October 07, 2009
The Dow tried to sell off today but came all the way back to end the day off by 5 points. Volume was light and the advance/declines were positive. My order for OEX puts was not filled overnight and I canceled it near the close. I will probably come up with another overnight order but I'm not sure that the short side is the way to go just yet. That said, the summation index is moving to neutral. We aren't short term overbought yet but we're getting there. I'll ponder things tonight. Gold was up another $4 and the XAU gained 2 1/2 points. ABX, GG and NEM all had fractional gains on average volume. Obviously gold was the place to be. Mentally I'm a bit tired, did not sleep long enough. 7 days left in the October option cycle. There is a chance that we just run up to new recovery highs here as well. I may stick with my original scenario though and look for some downside soon.
Tuesday, October 06, 2009
Another good day for the markets as the Dow gained 131 points. Advance/declines were better than 3 to 1 positive while the volume was average. We've gotten a decent bounce and if my prognosis for lower prices is correct, that should be about it. However the possibility remains that I could be wrong and the decline is over. In that case we will be going on to a new recovery high. The summation index has not turned around yet so I'm sticking with the bearish case for now. I have an open order in for some OEX puts. We'll see what happens tomorrow. Gold had a great day, up over $20 to a new all time high. The XAU rose 10 points. I cannot believe how many times I have missed out on gold. I was there but did not have the conviction to just get long. I really need to work on that. ABX up 2, GG up 2 1/3 and NEM up 3 all on good volume. The dollar fell again and is at support. If it doesn't hold, gold will go much higher I think. However if the market turns around here and starts to fall again, the dollar will see some buying. Mentally I'm feeling OK, slept well enough. So gold is taking off and I'm not in it again. The weekly gold share charts looked bearish and the market just turned around. However the daily dollar chart was overbought. At any rate, where we go from here is what matters. I'm sticking with the bearish OEX scenario for the October option cycle. We'll see what happens tomorrow.
Monday, October 05, 2009
We got the expected bounce today as the Dow rose 112 points. Advance/declines were better than 4 to 1 positive and the volume was average. It's now when things get interesting. Is this just a bounce in a decline or the start of another leg up? Answer that correctly and you' ll make some money in the next 2 weeks. I'm inclined to think that it's the former and I'll be looking to get some OEX puts this week. But that's not etched in stone. Gold had a good day on the US dollars decline. The precious metal gained $13 and the XAU rose 5 points. ABX, GG and NEM were all up around a buck with GG leading the way. Volume wasn't impressive though. If my overall market weakness scenario is correct, then the gold shares will be dropping back once again. I like the gold shares still though but the weekly charts look bearish. So I'm on the sidelines there even though I put in an overnight order for some GG calls last night. Obviously it wasn't filled as the gold shares rose from the start of trading today. Mentally I'm doing OK. Slept well enough. As I looked things over this weekend it appeared that gold could be in for another short term rise here. However it looks like gold is leading the gold shares and that is never a sign of a longer term move. At least not in my experience. We'll see what happens there. I'm going to be looking at getting some OEX puts on Wednesday. That is the game plan at this point. Market action will dictate whether that trade is worth doing when the time comes.
Friday, October 02, 2009
We sold off early and tried to come back all day but the Dow closed with a loss of 21 points. Advance/declines were 2 to 1 negative and the volume was average. Considering how weak the employment report was, it could have been worse. However we are pretty oversold here and a bounce is expected here in the next day or so. We are also at the 50 day moving average on the OEX so some type of support can be expected here. I don't think it will last though. Summation index still pointing down. Gold was up a few bucks on a weaker dollar. But it wasn't the expected rally after a weak employment report. The XAU was off about 1/2. ABX, GG and NEM all had fractional losses on average volume. They were higher early. The weekly charts look bearish for the gold shares but I did put in an order for some GG calls today and it wasn't filled. I may try again next week but we'll have to see. I need to check things out over the weekend. Mentally I'm feeling OK. 2 weeks left in the October cycle and I'd really like to try something here. The market seems to have gotten pretty weak all of a sudden. I'm going to have to continue to believe that rallies can be shorted. If we even get a rally. So perhaps trying anything from the long side here isn't a good idea. I'm going to study the charts over the weekend and come up with a game plan for next week. For now, it's time for a break.
Thursday, October 01, 2009
Well, the decline began in earnest today as the Dow lost 203 points on good volume. Advance/declines were 4 to 1 negative. Rallies can be shorted. We are pretty oversold here so a bounce is in order but it will be short lived in my opinion if it happens. Summation index pointing down. I did end up putting in an overnight order for some OEX puts but it wasn't filled. I'll wait for some type of bounce and try again. Employment report tomorrow. Gold lost $8 today and the XAU fell 7 1/2. The dollar gained some ground today. Flight to safety already? ABX lost 1 3/4, GG dropped 1 7/8 and NEM off 1 1/2. All on average volume. The gold shares are at support here and a break would not be good for the bullish case. I'll be keeping an eye on them. Mentally I'm doing OK, slept well enough. So the employment report will be tomorrows focus and we go from there. I have no idea what the number will be but it is the markets reaction that will be key. I don't plan on putting on any trades tomorrow but you never know.