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Thursday, April 01, 2010

The Dow gained 70 points today on light volume. Advance/declines were over 2 to 1 positive. We opened higher, sold off and came back. Really not sure what that means as we await the employment report. Beginning of the month money flows perhaps? Summation index still going sideways. Tomorrow's a holiday, beginning a long weekend. The stock indices have moved sideways for 3 weeks. The employment report could provide the catalyst one way or the other. We'll know on Monday morning. Gold was up again, adding another $11. The gold shares continued to outperform with the XAU up 6 points. ABX up a point, GG up 1 1/2 and NEM up 2. And yes, it looks like I missed it. Volume was a little better today and that has been the one thing that's been missing in the rise of the gold shares this week. Gold itself is at resistance of $1130. If we get through there, the trend will be confirmed to the upside. The dollar was weaker again today, supporting gold. It really looks like this rally in the dollar is over, completing a 5 wave pattern to the upside on the daily charts. There is also a negative divergence in the RSI. I saw this a week ago but did not act on it. Now that it seems legitimate, any weakness in the gold shares next week could be an opportunity to buy. Mentally I'm feeling a bit frustrated for the potential gold share miss. That's what previous bad trades will do to you. They sometimes have a negative carryover effect. The trade potential is there but you don't act on it. Again, there is no one to blame but myself. I'll try and banish those thoughts over the long weekend. I'll be going over the charts but with only 2 weeks in the April cycle, the risk is elevated. That's why May could be a better play. At any rate, I'll await the employment report tomorrow morning. Right now I'm going to take it easy, regroup over the weekend and come up with a game plan for next week.

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