Friday, February 26, 2010
A sideways end to the month as the Dow gained 4 points on average volume. Advance/declines were positive. Not much to report today. Summation index still higher. I'm beginning to look at the OEX March calls for the beginning of next week. Medium term overbought here but staying there. Shorter term we are moving to oversold on the stock indices. I'll think about it over the weekend. Gold was up $10 and the XAU rose 1 1/3. ABX, GG and NEM all had fractional moves to the upside on light volume. The dollar was off a bit today. March is historically the worst month for gold over the past 30 years. That is something to consider in the short term. I have no gold share trades on the horizon unless I consider a GG earnings play. Doubtful for me at this time. Mentally I'm doing OK, slept better. Moving on to March and I'll try to get a better handle on myself. We've got the employment report in a week. It seems to me that the market wants to go higher here but I could be wrong. Plenty to think about over the weekend. It's time for a little rest though as Friday afternoon is upon us.
Thursday, February 25, 2010
Volatility is back as the Dow opened lower by 175 points and ended the day down 53. Volume was average and the advance/declines were negative. The overall market was stronger than the Dow which bodes well for the bullish cause going forward. Europe is going in the tank, supposedly causing todays market gyrations. I'm leaning towards the upside but have no trades at the moment. It could be a sideways affair as well, I'm just not convinced one way or the other. Gold was up $11 and the XAU rose 4 1/2 on safe haven buying. ABX up 3/4, GG up over a buck and NEM rose 2 1/2, all on better volume. NEM had a good earnings report. GG is the only one of the big 3 left to report earnings and that's in 2 weeks. Is that an opportunity to get some calls before the report? Who knows? The dollar was higher early and then sold off some. No gold share trades for now. Mentally I'm a bit tired, did not sleep well. End of the month trades tomorrow and we'll move on from there. I don't have anything in the works but I am leaning towards getting some OEX calls. Not a clear signal as yet though. Patience for now.
Wednesday, February 24, 2010
Back to the upside as the Dow gained 91 points on average volume. Advance/declines were over 2 to 1 positive. The trend is up as the summation index continues higher. Declines look like they can be bought at this point but that is subject to change. The option premiums are actually favoring the OEX puts now, which implies downside ahead. So perhaps the trend is sideways and not up. I have no clear idea, obviously, at this point. The sidelines are the place for me for now. Gold lost $6 and the XAU fell a point. ABX, GG and NEM all had fractional losses on light volume. The dollar was little changed. I don't have any trades in mind for the gold shares here as well. This looks like a week that I will probably let pass. Mentally I'm feeling OK, could have slept better. Moving towards the end of the month. I have no good signals at the moment so it's a waiting game. I'll try my best not to do anything stupid but you never know.
Tuesday, February 23, 2010
The McClellan oscillator signal was valid as the Dow lost 101 points today. Volume picked up a bit from what it's been lately. Advance/declines were over 2 to 1 negative. So there's another trade missed but what can you do? I don't think this will be an extended decline but I haven't done anything right lately. Volume has been higher on the declines for the last few weeks and that could be troublesome going forward. We'll see. Gold was off $10 and the XAU dropped 5 1/2. ABX, GG and NEM were all off a buck or more on average volume. The dollar found some strength today. The daily candlestick charts for the gold shares are now bearish. Puts can possibly be purchased on a snap back to the upside. That's my guess for now there. Mentally I'm feeling good, slept well. Now about missing this downside activity in the indices. It isn't about money. Having screwed up the last trade for a loss influenced how I handled the latest signal. It kept me on the sidelines. The mental capital lost in losing trades is one of the most important things to consider. Trades affect each other. It's important to keep your confidence. Losing trades take away from that when you don't follow your rules and maintain proper discipline. That's what just happened to me. It shouldn't. I'm working on it.
Monday, February 22, 2010
Not really much going on the Monday following option expiration as the Dow lost 19 points on light volume. Advance/declines were about even. Overbought and staying there. The McClellan oscillator is indicating a decent move tomorrow with its action on Friday. I'm guessing it will be to the downside but who knows? I didn't have the guts to get some OEX puts today but there is a lot of time for the March option cycle. The price movement would have to be extensive to make it worth the risk. Gold lost $9 on the futures and the XAU fell 2 1/2. ABX off a point, GG down 2/3 and NEM lost 3/4. Volume was light. The dollar didn't do much today either. No gold share trades for now but we are overbought. I'd be leaning towards the puts though. March is historically the worst month for gold. Mentally I'm feeling OK, slept well enough. We've moved on to the next option cycle and I'm in no rush to put on any trades. Not to mention my confidence is low after last weeks debacle. I'm moving on but don't see anything worthwhile at the moment. We'll see if we get a decent move in the indices tomorrow.
Friday, February 19, 2010
The decline that I anticipated for today did not materialize as the Dow gained 9 points on average volume. Advance/declines were positive. The volume has actually been light all week. We did get a drop of over 50 points early but it didn't last. We're now short and medium term overbought on the stock indices. The summation index is heading higher. Although we are overbought, the trend is up. Perhaps we will continue higher into the March option expiration. That would be my guess at this point. Gold was up a touch on the futures while the XAU lost about a point. ABX, GG and NEM had fractional moves one way or the other on average volume. It was a good week for the gold shares. Was it more expiration related maneuvering or the start of an extended more higher? Overbought here as well. Always plenty of questions and lately I haven't had the answers. Mentally I'm feeling OK, slept well. It was a disappointing week for me with yet another losing trade. I did not even follow my own trading rules regarding placing a stop loss order. That is unacceptable. As usual I need to work more on myself than I do on the markets. It's an ongoing project. So where do we go from here? Early in the March option cycle so there is no hurry to do anything. I'd expect some weakness early next week but who knows? I haven't exactly been accurate lately. I'll simply have to wait until I get a better feel of what's going on. It's Friday afternoon and time for a break.
Thursday, February 18, 2010
Continuing higher for expiration week as the Dow gained 83 points on average volume. Advance/declines were over 2 to 1 positive. Summation index heading higher. I dumped my OEX puts for an 80% loss since I didn't place a stop order when obviously I should have. This trade was doomed from the start as I did not have the discipline necessary to wait until today to try something for the expected drop tomorrow. There is nobody to blame but myself as this trading year seems to be a continuation of last years disaster so far. I'll have to regroup. The market is short term overbought and staying there. I still expect a decent drop tomorrow but the puts I had are too far out of the money. Gold was down a touch today and up a bit in the aftermarket. The XAU rose 2 1/3. ABX up 1 1/4, GG up about 1/2 and NEM up a buck or so. Volume was good. ABX had nice earnings and the gold shares rode that to a positive day. The dollar was little changed today. Obviously getting some gold share calls for the February option cycle was the place to be. I had my chances but wasn't good enough, again. Mentally I'm a bit tired but not bad. Dealing with this latest loss will be the challenge. I probably should stick to trading the time frames that I've had some success with. Extremely short term trading isn't what I'm good at. I'll need to remember this going forward. So you sometimes have to take your lumps and move on. I've been doing that a lot lately. We'll see what happens with expiration Friday and go from there. I have no trades on the horizon and no new ideas at the moment.
Wednesday, February 17, 2010
Some follow through to the upside as the Dow gained 40 points. Advance/declines were positive and the volume was average. My overnight order for the OEX puts was filled in the morning. They're slightly in the red. This isn't looking like it's going to work right now. I may just have to get out tomorrow and not even wait for Friday. 2 days left and it was a risky deal to begin with. But you never know. I still feel a decent decline will occur Friday. The short term technicals are overbought. We'll see how the overseas markets do tonight. Gold was little changed after yesterdays nice run up. The XAU fell a point. ABX and GG had fractional gains, while NEM had a fractional loss. Volume was pretty good. We are at short term resistance for the gold shares. No trades there for now. Mentally I'm a bit tired, could have slept better. So I'm in a short term OEX trade and it isn't looking good with very little time left. Perhaps I was just looking to make a trade in the February cycle, when maybe I should have passed. That's a possibility. I wouldn't have put the trade on though, if I didn't think it had a chance to work. So we'll see what happens at the open tomorrow and go from there.
Tuesday, February 16, 2010
A big upside move to start a shortened option expiration week as the Dow gained 170 points on average volume. Advance/declines were over 4 to 1 positive. The summation index will be moving to the upside now. I'm still calling for Friday to be a pretty good down day. The question is from what levels? I'm leaving in an overnight order for some OEX puts. This may not be the brightest idea but I'm going to give it a shot. 3 days only until expiration. I'm hoping to get filled on the follow through upside tomorrow morning and then hold until sometime on Friday. We are almost at the 50% Fibonacci retracement of the recent downside and the RSI is at 50 for the OEX. So we'll see. We could just shoot straight up from here as well. Gold had a great day, up $20 to $30 depending on which contract you're watching. The XAU rose 4 1/3. ABX up 3/4, GG up over a buck and NEM up 7/8. Volume was good. The dollar was weak today for a change and we are being turned back at the 200 day moving average on the daily charts here. However I would have liked to see a better move in the gold shares today. It didn't happen and that is puzzling. Mentally I'm feeling good, slept well. So it looks like I'm going to try a short term OEX trade here and I usually don't fare too well with this type of trade. I may just have to wait until Thursday to put it on. The overnight order that I have is out of the money and positioned to be filled if we get a 3 to 4 point upside move in the OEX tomorrow morning. So we'll see what happens.
Friday, February 12, 2010
An interesting Friday before a long weekend as the Dow lost 45 points on average volume. Advance/declines were negative. The overall market was stronger than the Dow. We sold off over 150 points early and fought back all day. The market has the feel that it wants to go higher. The option premiums on the calls have expanded vs. the puts. I may have to forget about the OEX puts but I'll check things over the weekend. Gold lost $4 on the futures and was lower than that early as well. The XAU fell a point. ABX, GG and NEM all had fractional losses on light volume. The dollar was higher today. Getting overbought on the gold shares short term. I don't see me doing any trades there near term. Mentally I'm feeling good, slept well. 4 days to go in the February option cycle. Like I said it feels as though we will be moving to the upside early next week if there are no surprises over the weekend. I perhaps should have gotten some OEX calls today. I was considering the puts actually and I still might try them but it will have to be later in the week next week, if at all. I will have to consider a number of things over the weekend. Risk will be high with so little time remaining. Profit has the potential to be high as well though. The indicators on the weekly charts for the stock indices look like they want to turn back to the upside. Plenty of time this weekend to decide what, if any, action to take. For now it's Friday afternoon and time to take a rest.
Thursday, February 11, 2010
Moving higher now as the Dow gained 105 points on average volume. Advance/declines were 3 to 1 positive. The summation index could stop its decline with todays market action. We are getting to short term overbought on some indicators but I think there is still room to move higher before resistance. That said, I am leaving in an order for OEX puts in case we get a big pop on the open tomorrow. It would have to be pretty big because the ideal time to get short will be at the beginning of next week. That's my guess at least. There's a chance that we just go higher from here for a few days without a pullback too. Gold had a good day, up $18. The XAU rose 6 points. ABX, GG and NEM were all up around 1 1/2 on average volume. Short term overbought here and it was a missed opportunity for me again. I'm not going to chase this move though. However it is possible that gold has corrected and will resume its upward momentum. The weekly chart looks constructive in this regard. Mentally I'm feeling OK, could have slept better. There is a chance that the decline in the stock market has ended. The summation index may turn around here. I'm not completely sold on this idea but it is possible. Right now I am concerned with making a decent trade in the 5 days that remain in the February option cycle. I think that the OEX gives me the best chance to do that. It won't be easy though. We'll see what the market has to say tomorrow.
Wednesday, February 10, 2010
Kind of a sideways type of day as the Dow lost 20 points. Advance/declines were negative and the volume was light. No clear signal here. If we have weakness going into the end of the week, I may try some calls for anticipated strength at the beginning of next week. But anything can happen. Summation index still pointing down. Gold was flat on the futures and down a bit in the aftermarket. The XAU lost 1/2. ABX, GG and NEM had fractional moves one way or the other on lighter volume. The dollar was higher. I'm not considering any gold share trades at the moment but I'll be looking things over again tonight. Mentally I'm a bit tired again, did not sleep well. I have a couple of scenarios for the overall market going forward from here but none that look solid. It is hard to be patient. I could make a case for getting short if we have strength tomorrow or getting long if we have weakness. 6 days in the February option cycle and a long weekend coming up in the US. I'll look things over tonight and see if I can come up with something worthwhile.
Tuesday, February 09, 2010
The Dow rose 150 points on good volume today. Advance/declines were over 3 to 1 positive. We were oversold and due for a bounce again. We were up over 200 at one point but 150 points isn't bad for the bulls. Rumors of a Greece bailout helped. We are definitely choppy here and it makes for tough trading on the OEX. I'd still like to try some puts before expiration though. Gold was up $11 and the XAU rose 5 3/4. ABX up over a point, GG up 1 1/2 and NEM up 1 1/3. Volume was good. The dollar took a good hit on the Greece rumor, which helped the price of gold. My ABX call order wasn't filled. The volume has picked up on the upside moves in the gold shares. That should be bullish going forward. I may try the ABX calls again or perhaps GG. But I'll have to see a pullback from here and that may not happen. Mentally I'm a bit tired, did not sleep well. The market has speeded up here and I haven't been able to make the decisions to keep up. Well at least I haven't lost any money but I haven't made any either. Option premiums have risen with the increase in volatility. However with just 7 days left in the February cycle, time premium will be sucked out at a rapid pace. So we'll see what happens.
Monday, February 08, 2010
The bounce after Fridays comeback did not happen as the Dow lost 103 points on average volume. Advance/declines were negative. This type of action doesn't bode well for the near term as the path of least resistance remains to the downside. The summation index is still pointing down. We will be short term oversold on any negative action tomorrow however. I'm not sure that it is worth an OEX call trade though. Perhaps later in the week. Gold was up $13 on the futures but it was catch up from the late aftermarket gains of Friday. The XAU lost almost 5 points. ABX and GG lost more than a buck and NEM dropped almost 2. Volume was average. The dollar was little changed. I have an order in for some ABX calls again. I'm going to have to look at things tonight to see if I'll leave it open tomorrow. If the market continues to drop, the dollar will probably find more strength and that would not be helpful for gold. However gold is oversold and there is a positive divergence with the RSI indicator. More to ponder. Mentally I'm feeling fine, slept well. It's an interesting market at the moment. 8 days remain in the February option cycle. Risk is high and so is volatility. It also means that money can be made or lost quickly. I have an idea for the gold share calls but it hasn't been working lately. We also did not see any follow through to the overall markets comeback on Friday. So it's a tough call as usual. Oversold and staying there is a recipe for lower prices. I'll have to think about things tonight. For those keeping score this is the 1500th entry to Jimmybees Stock Market Trading Blog. I hope it's been helpful for you.
Friday, February 05, 2010
It was a one day reversal as the Dow was off better than 150 points and came all the way back to close up 10 points. Advance/declines were negative and the volume was heavy. Could the decline be over? Perhaps. The employment report really didn't shed too much light on the situation. Todays market action suggests that the worst is behind us for now. Monday will be key. If we get a decent rally, I'd say that the decline has ended. If we turn right around and end up negative, then I'd say not. Gold made a comeback as well, down $10 on the futures but getting back to positive territory in the aftermarket. The XAU rose 7 3/4. ABX up almost 2, GG up 2 1/3 and NEM up 2 3/4. Volume was heavy. The dollar was higher as well but the gold shares rallied. Looks like I was a day late here as well. However if we get some weakness on Monday, I may have to give the ABX calls another shot. We'll see. Mentally I'm feeling well, slept good again. It's been quite a week and next week could be just as challenging. Volatility has picked up and the speed of the markets has increased. My ideas have been pretty good but the execution hasn't. Hopefully I can change that next week. There will be a lot to look at over the weekend. As I said before, Monday will be important. But for now it's Friday afternoon and time for a break.
Thursday, February 04, 2010
The stock market took a hit today as the Dow lost 268 points on good volume. Declines beat advances by over 8 to 1. My order for OEX puts wasn't filled as I have missed another opportunity. We got the snap back from the oversold condition but I was hoping we would hold up for another day. We didn't. Hard to figure where the next bounce will come from now. Employment report tomorrow and that will probably be sold as well. It kind of has the feel of a worldwide liquidity problem again. We'll see what happens but it won't be easy to trade. Gold got clobbered, down almost $50. The XAU lost 8 1/3. ABX, GG and NEM were all down $2 or more on heavy volume. The dollar had a good day in the flight to safety. So why isn't gold doing better? All commodities are being sold at the moment. However if I do try a bounce trade, I think I may do it in the gold shares. It's early to think about it seriously though but I could be wrong. The Gold/XAU ratio signal is still there. The trouble is that just like the stock market, the gold market is oversold and staying there. Mentally I'm feeling good, slept well. So where do we go from here, that is always the question. The trend is down and I don't see a change there anytime soon. Perhaps the market will simply continue lower for the February option cycle. That would be for a couple more weeks after tomorrow. I suppose I may have to wait for a clear oversold signal and then try a bounce trade. More tomorrow.
Wednesday, February 03, 2010
A slight pause after 2 pretty good up days as the Dow lost 26 points on light volume. Advance/declines were negative. We were lower from the open and stayed that way for the trading day. I placed an open order for some OEX puts and I'm leaving it in overnight. I'm still a believer in the downside here but things could change as always. Employment report on Friday and it should be a market mover. I'm not sure If I'm going to take a position before then but probably will. Gold lost $6 today and the XAU fell 1 3/4. ABX and GG were off about 1/2, while NEM was higher by about as much. Volume was light. The dollar had a better day today. I'm not planning on doing anything in the gold shares at the moment. Perhaps before the February expiration. Mentally I'm doing OK, could have slept more. So I have an order in for some OEX puts but I'm not exactly sure if this is the right thing to do. Summation index still pointing down and we are in the process or have worked off the short term oversold condition. So it's a tough call as usual. I still think that it might be worth a shot though. We'll see what happens tomorrow. Perhaps sleeping on it will give a more concrete resolution.
Tuesday, February 02, 2010
We continue higher as the Dow gained 111 points. Advance/declines were over 3 to 1 again and the volume was light to average. We are getting a snap back as I had hoped we would. But could it be more than that? Maybe. I'm sticking with my bearish scenario though and will look to get some OEX puts on strength tomorrow. It won't be easy to do but I'm going to give it a try. Summation index still pointing down but will be trying to turn around soon if the positive activity continues. However the premiums on the OEX puts remain much higher than the calls and that was the case before the previous decline. Gold continued higher as well, up $13 on the futures. The XAU could only manage a half point gain. ABX, GG and NEM had fractional moves one way or the other on average volume for lately. The dollar fell a bit again. Might try the gold shares again to the plus side but it won't be until next week. Mentally I'm a bit tired, did not sleep well. I'll be concentrating on the OEX for now and it's a much faster game than the gold shares. The game plan remains the same and that is to be short going into the employment report. If we get some follow through upside tomorrow morning, that could be the opportunity that I'm waiting for. Or not. It's never easy but I have to follow my convictions here and see what happens.
Monday, February 01, 2010
Finally a decent bounce as the Dow gained 118 points on light volume. Advance/declines were over 3 to 1 positive. Oversold bounce? Beginning of the month money flows? You can take your pick but it was bound to happen. Now is the decline over? That is the question. I still would like to try the OEX puts before the employment report on Friday. If we continue higher into the close on Wednesday then I will give them a try. As the McClellan oscillator makes its way back to the zero line. That is the key. To try and remain patient for the next couple of days and see what happens. Gold had a stellar day as well, up over $20. The XAU rose over 8 points. It was bound to happen with a decent Gold/XAU buy signal and the oversold condition. ABX and GG were up over 1 1/2, with NEM up 2 3/4. Volume was light but you can't argue with the price movement. The dollar lost a bit of ground but not much. I almost bought some ABX calls on Friday after I had gotten stopped out of the previous trade. But almost counts for nothing. I may try the gold shares again for the February cycle later this month. Mentally I'm doing good, slept well. So I'm sticking with my bearish scenario for later this week barring a market melt-up prior to then. But I could be wrong and that must be considered as well. Perhaps the decline is over. However if we remain positive going into Friday we will have worked off the oversold condition and perhaps will go back down for a retest of last Fridays lows. Time will tell.