Friday, January 29, 2010
Opened higher and closed lower. We were up over 100 points early but closed with a loss of 55 points on the Dow. Advance/declines were over 2 to 1 negative and the volume was good. GDP was better than expected but the market could not hold the gains. Something is going on here because we are oversold and staying there. Summation index still pointing down. We haven't even seen a decent bounce yet. I still like the OEX puts before the employment report if we get some type of upside. Gold only lost a buck but the XAU followed the overall market and was off 5 1/2. ABX and NEM each dropped more than a buck, while GG was lower by 1 3/4. The dollar continues to march higher. My ABX calls were finally stopped out for a loss of 45%. Not a lot of money in the trade thankfully. It didn't feel good from the start and never had a chance to work. The Gold/XAU buy signal is still in place but it doesn't look like it's going to work. Oversold and staying there on the gold shares as well. I my try again on Monday but I will have to check things over the weekend. It may be time to forget about gold for a while. Mentally I'm OK, could have slept more. The market can't seem to get any traction to the upside. No doubt oversold and should have seen some type of rally by now. If we get one early next week I'll probably get some OEX puts. So we'll see. Another losing trade closed today but I'm moving on. Sometimes you just get it wrong. For now it's the weekend and time for a break.
Thursday, January 28, 2010
Another downer as the Dow lost 115 points. Advance/declines were over 2 to 1 negative and the volume was average. We were lower for most of the day and then tried to make a comeback but failed at the end of the day. Bernanke was confirmed for another 4 years at the Fed. Didn't help the market though. Summation index still heading lower. We did not get a good bounce when we should have and that isn't good for the bullish cause. End of the month tomorrow plus GDP. Could get dicey. Gold was flat on the day after being lower. The XAU lost 1 1/3. ABX, GG and NEM all had fractional moves one way or the other on better volume. The dollar was up again. My ABX calls are still in the red. Really need to get rid of them but I'm still getting a buy signal on the Gold/XAU ratio. The gold share technicals are way oversold as well. At any rate I almost was stopped out of the trade today and will be tomorrow if we get any downside so perhaps it won't matter. Mentally I'm doing OK. Another thing to consider here is possible beginning of the month positive money flows on Monday as well. But I will be looking for OEX puts before the employment report as I have already stated. So let's get through tomorrow and see how things shape up after that.
Wednesday, January 27, 2010
Getting the expected bounce now as the Dow gained 42 points on average volume. Advance/declines were negative though. The Fed announcement came and went. Nothing new there. We were lower for most of the day and rallied in the last hour and a half. We're working off the oversold condition. GDP and the end of the month on Friday. I'm still leaning towards the OEX puts at some point next week if we hold up. Gold lost $13 and the XAU dropped 1 1/3. ABX and GG had fractional losses while NEM was unchanged. All were lower during the trading session. Volume was average for lately. My ABX calls are still underwater. The dollar was higher today. I am getting a buy signal from the Gold/XAU ratio and the gold shares are still oversold. However, I cannot hold on to this trade forever and should be out by the end of the week. Unless Friday is a huge up day for gold and I don't see that happening at the moment. Mentally I'm doing OK. Is it possible that the decline is over here? Maybe but I'm thinking that it isn't. The summation index is still pointing down but the stock indices are oversold technically. So there are some crosscurrents. Obviously the ABX call trade was a mistake on my part at this point. I'll need to take care of that before I move on to the OEX.
Tuesday, January 26, 2010
Could not hold on to the gains again as the Dow lost 2 points. We were up over 80 at one point during the day. Volume was average and the advance/declines were negative. Seems as though the market wants to head back to the downside. Waiting on the Fed tomorrow. Oversold still and now staying there and that isn't a good sign. Getting short on a bounce is the plan for the OEX at this point. Gold was up a couple of bucks but the XAU lost a point. ABX, GG and NEM all opened lower, came back to have nice gains and then gave them all back to finish around unchanged. Volume was light to average. The dollar had gains on the day. My ABX calls are still negative and will get stopped out if we have a negative day tomorrow. This doesn't look like a very smart trade at this point. But we'll see. Stranger things have happened. The gold shares are very oversold and have yet to get a bounce. Mentally I'm doing OK, could have slept better. I need to be looking at exiting the ABX call trade this week. I'll have to be out at the first bounce. It just doesn't have the feel of something that is going to work out. We'll see if the Fed announcement can get things going one way or the other.
Monday, January 25, 2010
A slight bounce today as the Dow gained 24 points on lighter volume. Advance/declines were positive. We were higher for most of the day but then sold off in the last hour. Still oversold here so I would expect some more upside at some point this week. Fed meeting starts tomorrow and then the rate announcement on Wednesday. I'd expect tomorrow to be a day of waiting around but I could be wrong. OEX puts at some point seem to be the play. Gold was up $6 but the XAU fell 1 1/2. ABX, GG and NEM all had fractional losses on good volume. The dollar was little changed. I left in an overnight order for some ABX calls and it got filled. It's already in the red. The stop-loss order has been placed. This could just be a mistake as the gold shares are showing me nothing at the moment. This is supposed to be a quick trade and I will most likely give it until the Fed announcement. The technicals on the gold shares are oversold and a bounce is due here as well. Unless it doesn't happen of course. So I'm giving it a couple of days and then we'll see what happens. Mentally I'm doing OK, slept well enough. So another trade is underway and I'm wondering if I should have just waited to get some OEX puts instead? I still plan on getting some, perhaps later this week. On to tomorrow.
Friday, January 22, 2010
Continuing to the downside as the path of least resistance is lower. The Dow lost 217 points on heavy volume. Advance/declines were over 4 to 1 negative. We should see a bounce early next week. It may be an opportunity to get short. But it won't be easy. Oversold here and playing the bounce could be tricky. I think that I will wait to get some OEX puts as the McClellan oscillator tries to head back up to the zero line. Gold lost $13 on the futures but the XAU only fell 3/4. Perhaps getting some gold shares calls as a flight to safety will be the play. ABX, GG and NEM all ended the day where they started after selling off, then rising for nice gains and finally falling back again. Volume was heavy. The dollar was off a bit. I'm thinking about getting some gold share calls but will have to review things over the weekend. The XAU is oversold as well. Mentally I'm feeling OK, slept long enough. Volatility has picked up and that has to be taken into consideration going forward. The market environment has changed. There's still 4 weeks to go in the February option cycle, so there's plenty of time to do something. We did break the uptrend line in the S&P 500 today that was in place for 6 months. Perhaps the market is concerned with what President Obama has been saying about the banks lately or maybe it's the concern over Ben Bernankes reconfirmation as Fed chief. You can't argue with the price movement though. There's lots to ponder over the weekend. It's Friday afternoon and time to relax for a while.
Thursday, January 21, 2010
To the downside as the Dow dropped 213 points on heavy volume. Advance/declines were about 4 to 1 negative. Summation index heading lower. The downside action was long overdue. So where do we head from here? My thinking short term is that we should stabilize now. Obama rattled the markets with his talk of banking regulation today. It won't happen overnight. We're getting short term oversold now. It may be time to short the rallies. Volatility has returned. Gold lost ground again, off about $10 and lower in the aftermarket. ABX and GG down over a buck each. NEM off 2. Volume was heavy. Oversold here now for sure. Not sure if getting long is a good idea because we have broken some long term support. However the gold/XAU signal is about to be triggered so I will have to ponder things. Volume picking up to the downside isn't a good sign though. Tough game. Mentally I'm tired, did not sleep enough but that will change. We're almost at some short term support for the overall market. Bounce and then a fall? Perhaps but that's just a guess. If the summation index remains to the downside, then OEX puts have to be seriously considered. Gold fell today and the dollar was little changed so perhaps there is something bigger going on there. No doubt that money is leaving the gold shares though. Support has been broken. One day left in a short week.
Wednesday, January 20, 2010
We saw some downside today as the Dow was off 200 points early. We ended the day with a loss of 122 points on average volume. Advance/declines were 3 to 1 negative. So we gave back all we made yesterday. It's been a down, up, down market here and tomorrow will be important. If we head back down it could signify the end of the rally. The summation index has turned around again. We are also not making it through the longer downtrend line on the S&P that has been in place for quite a while. Since 2007 to be exact. So we are at an important moment in time. Gold got clobbered today, off over $25. The XAU fell 6 2/3. ABX off 1 3/4, GG and NEM down over 2. Volume was heavy. We've broken through the weekly uptrend line on the gold shares that's been in place since July. The trend is now down. The dollar had a good day in a flight to safety in my opinion. So perhaps the game has changed for gold. Time will tell but there is no reason to get long the gold shares at the moment. They will fall with the broader market. Mentally I'm a bit tired, did not sleep enough. Meetings again today took me away from the normal market routine and I have an early appointment tomorrow as well. But that should be it for the distractions for a while. It looks like we may finally have hit an inflection point for the markets this week. There will be opportunity and I'll try and take advantage of it.
Tuesday, January 19, 2010
We start the shortened week with a gain of 115 on the Dow, reversing Fridays price action. Volume was light to average and the advance/declines were 3 to 1 positive. We still haven't broken through the longer term downtrend line convincingly but that could change this week. No OEX trades for now but I have noticed that the premiums on the puts are relatively higher than the calls. I'm leaning to the downside here. We'll see. Gold was up $5 and a bit more in the aftermarket. The XAU rose a point or so. ABX was off a bit on the day, while GG gained 1/2 and NEM 3/4. Volume was light. The dollar had a good day and gold was higher anyway. Perhaps due to the worldly unrest over the weekend. Whatever the reason, we are right at the uptrend line in place since last July on the gold shares. Will it hold? That is the question. It would be a good place to get long, if it does hold. I'm not so sure though, so I'm staying out for now. Mentally I'm doing OK, slept good. 5 weeks on the February options, so there is no rush to do anything. Another meeting tomorrow so I won't be in the usual market mode. This could just be a wait and see week for me. No solid market themes that I can detect here but that certainly doesn't mean that there aren't any. I'll check things overnight and go from there.
Friday, January 15, 2010
The Dow dropped 100 points today on average volume. Advance/declines were over 2 to 1 negative. Downside here is overdue. The summation index turned lower today. OEX puts could be the next trade. We'll see. I'd like to see some sideways movement before we head down. That would be the ideal scenario. I'll check things out over the weekend. Gold lost $12 today and the XAU fell 3 1/2. ABX, GG and NEM were all down around a buck on average volume. The dollar was stronger today. If the overall market falls, so will the gold shares. We are right at the longer term uptrend line and it doesn't look like it will hold. The weekly charts now look bearish with this past weeks price action. I may take a look at the puts here as well. Mentally I'm feeling tired, have not been getting enough sleep. Monday after expiration is sometimes just the opposite of the preceding Friday. It's a holiday, so Tuesday will replace Monday. If we see some upside it could be time to start closely looking at the puts. For now it's the weekend and time for some much needed rest.
Thursday, January 14, 2010
The Dow gained 30 points today on light volume. Advance/declines were positive. Still grinding our way higher. That can't last forever. Expiration tomorrow. No good signals to trade for me here. So it's patience and the sidelines. Gold was up $6 but the XAU fell 1 1/2. ABX, GG and NEM all had fractional losses on light volume. The uptrend line since last July is still holding for the gold shares but I get the feeling it won't much longer. When gold itself rises and the gold shares don't show any gains, it's not a good sign. Mentally I'm feeling a bit tired. I was in a meeting most of the day and was not in my usual market routine. Same story tomorrow. We'll get through expiration and go from there.
Wednesday, January 13, 2010
Back to the upside as the Dow gained 53 points. Advance/declines were over 2 to 1 positive and the volume was light. Uneventful really as the positive expiration bias is in effect. No OEX trades for now and there are no decent technical signals. Not overbought or oversold at the moment. Patience for now. Gold sold off early and then came back to be up $7 on the day. The XAU gained 2 points. ABX, GG and NEM all had fractional gains on light volume. The dollar was a bit weaker. The uptrend line from July remains intact for now. I do not anticipate getting long here but you never know. Mixed technicals here as well. Plus there is an extra week on the February options. So there's no rush to do anything here. Mentally I'm doing OK, slept well enough. We're moving through January and still grinding our way higher in the stock indices. Gold is somewhat moving sideways. I'm looking for the next trade but do not have any solid ideas at the moment. That will change in time.
Tuesday, January 12, 2010
Finally a bit of some downside today as the Dow lost 36 points on average volume. Advance/declines were over 2 to 1 negative. The overall market was much weaker than the Dow. I don't think that this is the start of anything big to the downside just yet. We have held at the uptrend line that has been in place since mid-December. We will move quickly to short term oversold after today and it is expiration week which usually has a positive bias. So we'll see. Gold lost over $20 today and the XAU fell 6 3/4. ABX, GG and NEM all lost around 1 1/2 on what goes for average volume lately. The dollar didn't really do much today and was lower most of the day. I don't have any gold share trades in the works at the moment. I'm leaning towards the puts if we break the uptrend line that has been in effect since last July. We are hovering around it at this point. Mentally I'm doing OK, considering yesterdays problems. I did follow my trading rules and I can take that positive away from the experience going forward. There isn't much I can do about lousy or non-execution by the brokerage. Next time I'll make the adjustment if the stop-limit doesn't get filled and just go out at the market. That doesn't make taking the loss any easier but at least I had the proper feel of what was going on with the trade. That's a good thing. 3 days until expiration and the sidelines is where I am and probably where I'll be.
Monday, January 11, 2010
Overbought and staying there as the Dow gained 45 points. Volume was light and the advance/declines were positive. Grinding our way higher but we will need to see some type of downside soon just to relieve the overbought condition at the least. The market has refused to sell off. It is expiration week so anything can happen I guess. Gold had a good day, up $12. However the gold shares did not move well. The XAU only gained 7/8. ABX, GG and NEM were all higher early and then closed with just fractional gains. The dollar was weaker. So everything was present for the gold shares to have a stellar day and they didn't. That's troublesome. When we were higher at the open I adjusted the stop-loss order on the ABX calls to insure a profit. Imagine my surprise when we traded through the stop-loss price, back and forth and my order wasn't filled. That hasn't happened to me in 15 to 20 years. I contacted my brokerage but they didn't do anything. Here I did everything that I was supposed to, trying to insure a profit and it didn't happen. There usually isn't a problem with stop-loss orders but for some reason there was today. Needless to say it was very frustrating dealing with a know-nothing customer service rep at the brokerage. The non fill cost me a profit. It happened to me with the gold share index many, many years ago. I eventually bailed out of the ABX calls for a 25% loss instead of a 40% gain. Not the way that anyone would like to start the new year. I could not hold the position any longer though. 4 days left and a buck out of the money. Technicals overbought. A good day for gold and the gold shares sell off after a higher opening. Ominous signs if you ask me. But anything can happen. Mentally I'm feeling tired, did not sleep enough. So where do I go from here? I just had 3 chances for a profit on that trade and failed. I won't be blaming myself though. Lousy or non-existent trade execution isn't something that I can control. I did what I was supposed to today and for whatever reason it didn't work out. I'll bear this in mind going forward.
Friday, January 08, 2010
Well we finally got the employment report behind us. The Dow sold off but it wasn't a catastrophe and the market came back to finish up 11 points on the day. Volume was light and the advance/declines were positive. The market just keeps plowing higher. Summation index moving to the upside. The jobs report was worse than expected and we shrugged it off. It seems like a market that wants to go higher. Overbought here still and that won't last forever. We do have expiration week upon us next week and perhaps the positive bias will continue. Gold managed a $5 gain in the futures market but sold off a bit in the aftermarket. The XAU rose 2 1/2. ABX, GG and NEM all had fractional gains on light volume. The dollar sold off and I would have expected a much better move for gold today. It didn't happen. My ABX calls are slightly in the red. Never saw a pop to the upside to exit this trade. In fact it was a couple of ticks away from being stopped out at one point. It's a buck out of the money with just 5 days to go. I'll be looking to exit on Monday morning if we see some upside. My thinking is that we'll see some foreign selling of the dollar and buying of gold early Monday. We'll see. Mentally I'm feeling tired, did not sleep well or enough. The market is overbought and the technicals are at the tops of their channels. This condition can't go on forever. However the market continues to shrug off bad news and this implies higher prices. Gold is stopping at the 1140 level and will need to push through there for the ABX calls to show a profit. Or not. Things to ponder over the weekend. I'll view the charts and come up with a game plan for next week. It's Friday afternoon and time to unwind.
Thursday, January 07, 2010
A slight push to the upside as the Dow gained 33 points. Advance/declines were positive and the volume was average. Overbought here but that doesn't mean there has to be a big decline if we get one. All eyes will be on tomorrows employment report. I can only guess at what the numbers will be. How the market reacts will be the key going forward. The market has tried to sell off since Mondays big gain but hasn't. We'll see. Gold lost some ground today, off about $3 and more in the aftermarket. The XAU fell 1 1/2. ABX, GG and NEM all had fractional losses on lighter volume. My ABX calls are right back to where I bought them. This has been an interesting trade with a couple of chances to get out at a profit. Now comes tomorrows news and golds reaction to it. ABX is the weakest of the group at this point. The relative strength has moved to GG. There's nothing to do now except wait for the employment report. I should bail out of this trade tomorrow unless there is a strong move to the upside. Mentally I'm feeling tired, did not sleep well. We'll see what tomorrow brings.
Wednesday, January 06, 2010
Another day of hanging around as the Dow gained a point on average volume. Advance/declines were positive. We are short term overbought. The summation index continues to head higher. It looks like the employment report could be the catalyst one way or the other at this point. I'm really not sure which way we will go here so there are no OEX trades before Friday. Gold had another good day, up $18. The XAU rose 4 3/4. ABX up 7/8, GG up 3/4 and NEM up a buck. Volume was nothing special. All these issues closed nowhere near their highs for the day. My ABX calls are back in the black. The daily technicals are overbought now. I really have to think about dumping these things tomorrow. Longer term looks positive but I don't know if I want to hold the calls into next week. Or even past tomorrow with the employment report looming. A lot to ponder this evening. Mentally I'm doing OK. So I'm holding a trade that is profitable with 7 days left in the January cycle. It's overbought but we all know when things get overbought they can stay there for a while. The overall market is short term overbought also. Decisions, decisions. The trades are never easy, win or lose.
Tuesday, January 05, 2010
The Dow lost 12 points today but we were off more for most of the day. Advance/declines were positive and the volume picked up a bit. The overall market was stronger than the Dow. Not exactly overbought yet but we're getting there. Might just be on hold until the employment report on Friday. No OEX trades for now. Gold was little changed but was up early. The XAU gained 2 points. The gold shares had fractional gains and the volume was nothing special again. We were lower at one point and I thought that I was going to be stopped out of the ABX call trade but we came back late in the day. The calls are back where I bought them. The dollar was up a bit. Here too we could just be waiting on Friday. I don't know if this trade will last that long though. I'll check things out tonight. Mentally I'm feeling OK, could have slept longer. I guess it's a waiting game now. 8 days on the January options and my calls are out of the money. We did get some buying in gold yesterday as expected but I haven't seen any follow through. Not overbought yet so there is a chance that this trade will still work. However time is not on my side now and the possibility of getting stopped out looms large. If so it's on to the next trade regardless and I don't have any ideas for that at the moment.
Monday, January 04, 2010
It was a bullish start to the new year as the Dow gained 155 points. Volume was light but the advance/declines were over 4 to 1 positive. We'll have to see how the rest of the week progresses. Summation index heading higher again. Not overbought short term just yet so we could see some more upside near term. We'll see. Gold had a good day, up over $20. The XAU rose 5 3/4. All the gold shares were up at least a buck with GG leading the way, up 1 1/3. Volume wasn't anything special though. The dollar was weaker today. ABX rallied a buck but my calls are still in the red by a touch. That's the dilemma now. 9 days to go and even a one point move in my favor didn't do much. I don't know how much longer I can stay in this trade really. I don't know if I can wait until Fridays employment report. Not overbought yet short term for the gold shares but I didn't like todays action. I'll check things out overnight. Mentally I'm a bit tired, did not sleep well. It's the start of a new trading year and I'm feeling optimistic that it should go well. I'll be keeping an eye on gold overnight and we'll take it from there. No OEX trades just yet but we are near the top of the technical indicators and channels. Doesn't mean we have to drop though. We'll see what the second trading day of the year brings tomorrow.