Friday, July 29, 2011
The Dow is still being held hostage by the US debt situation as it fell another 96 points today. The advance/declines were 2 to 1 negative and the volume was good. Very oversold now and a decent bounce will happen at some point next week. I still think the bounce can be shorted. The summation index is heading lower. It is now just a matter of getting done with the debt deal and going from there. Probably want to have some OEX puts before next Fridays employment report. We'll see. GE was down 1/3 on good volume. We are right at the lower Bollinger band on the weekly charts. It either holds or we go into a waterfall effect. Gold continues to attract money, up $15 on the futures. The US dollar was weaker. However the XAU fell 4 1/3. ABX down about 2/3, GG lost 1 1/4 and NEM dropped 2 1/8. Volume was good. The Gold/XAU ration is solidly on a buy but that hasn't meant anything lately. Perhaps the September gold share calls will be the place to be. I'd wait for a base to build here though. Gold could sell off once the debt problem subsides. Mentally I'm feeling tired. I'm also tired of this debt debacle. It will get solved but it has been strung out to no end. If I had the confidence, I'd have bought some OEX August calls today. It wasn't a good week for me with the losing GG trade. There's still 3 weeks in the August option cycle though. However the increased volatility has really blown out the option premiums. The idea for now is to wait for the bounce and then get some OEX puts. I do not think we will be simply moving back straight up. I could be wrong and often am. Right now it's the last Friday in July and time for a break.
Thursday, July 28, 2011
Tried to rally but not just yet as the Dow lost 62 points on average volume. The advance/declines were negative. We opened higher and were up over 80 points but could not hold the gains. Oversold here and due for some type of bounce but the market is hostage to the US debt news at this point. I still will be getting some OEX puts if we bounce. Summation index heading lower. GE was higher early and couldn't hold its gains as well to finish the day flat. Volume was light. Gold lost a buck while the XAU fell 2 1/4. The dollar was a bit higher today. ABX lost 1/3, GG dropped 1 7/8 while NEM gained 3/8. My GG August calls got clobbered. The earnings were great but the guidance was lousy going forward. It was a 60% loss overnight for me. I made a mistake and I'm moving on. I still like the gold shares if we sell off some more. August and September are the 2 historically good months for the price of gold. Not oversold enough there yet though. Mentally I'm feeling tired, not enough sleep. The market is weak and what happens after a debt deal is reached will be important. We should rally pretty good because the uncertainty will be gone. But if we don't, things could get ugly. I would like to buy some OEX puts next week if the market cooperates. As for the GG trade, I probably shouldn't have tried it but hindsight is always right. My trading since the beginning of the year has been horrendous. In fact I have been in a losing funk for a year and a half. If not for a couple of decent trades early this year I would be way down again. I need to get it together and it isn't easy when confidence is low. I think I will let tomorrow pass and regroup over the weekend.
Wednesday, July 27, 2011
The Dow got clobbered today, down 198 points. The advance/declines were over 8 to 1 negative. I am not getting a good read on the volume. Oversold here now but that may not matter. The OEX puts were and are the way to go. It doesn't matter if we get the US debt crisis bounce and I hope that we do. That will be the entry point for the puts. The 10 day trin was way overbought and the CBOE call/put ratio was the highest it's been in a while. We are going lower. GE lost about 1/2 on good volume. It was the canary in the coal mine. No trades there still for me. Gold lost a couple bucks and has really held up rather well. The US dollar had a good day in the flight to safety. However the XAU lost 6 1/2. ABX fell 1 1/4, GG dropped 2 1/8 and NEM lost a buck. I bought some GG August calls today and that looks like a mistake. The earnings come out after the close today and that was the risk that I took. The options are already down about 15% from where I purchased them. I should probably just dump them one way or the other tomorrow. We'll see. If the earnings are decent, I'd expect some type of bounce tomorrow. Mentally I'm feeling tired. Really not happy about not owning any OEX puts here because that was the trade that I've been waiting for. Summation index is now gapping lower so you know where the trend is headed. I'll hope for a bounce and go from there. As for the GG trade, I was not going to try the gold share calls but when we were down this morning the option premiums got cheap so I gave it a shot. Plenty of time left on the August calls but I don't think this is something to hold on to. Unless we really shoot higher on good volume tomorrow. Remains to be seen. So we'll see the reaction to the earnings and go from there.
Tuesday, July 26, 2011
Again to the downside as the Dow lost 91 points on light volume. The advance/declines were negative. Still waiting on the US debt problem. Perhaps there won't be any time to buy the OEX puts at this point. However I still believe that there will be some type of relief rally and that will be the time to purchase the puts. We'll see. The summation index has turned around to the downside and I will take my cue from this. GE was down 40 cents on better volume. This is the canary in the coal mine. That is my opinion at the moment. No trades here but the weakness in GE portends overall weakness to come in my opinion. Gold continues to be attracting money and was up another $5 today. The XAU gained 1/3. ABX and NEM were little changed while GG lost 2/3. Volume was light. The US dollar was lower. I'm still considering the gold share calls but they would have to be purchased tomorrow before the earnings on Thursday and Friday. I'm now looking at the GG August calls. The problem is that we are still overbought on the gold shares here but if the earnings come through it won't matter. I'll decide if I want to take the risk tonight. Mentally I'm still a bit tired, did not sleep well again. The Dow has been weaker than the overall market lately and usually that means that we are in for a rally. That is one of the reasons that I am hesitating on the OEX puts. Also I believe that some kind of debt deal will be announced soon and that should lead to some buying. I could be wrong. GG announces its earnings after the bell tomorrow, so if I want to try something there, it has to be done tomorrow. Plenty to consider tonight. However I do not want to make a trade just for the sake of trading. We'll see what tomorrow brings.
Monday, July 25, 2011
We started the week off on a sour note as the Dow lost 88 points on light volume. The advance/declines were over 3 to 1 negative. I am going to have to decide if I just want to get the OEX puts right now or wait for the next minor rally. I really want to see if we get some kind of reflex rally when a US debt deal is announced. That would be the rally to short in my opinion. However the market may not wait for that as todays action could move the summation index back down again. More overbought than oversold here. Things to think about. GE was down a touch on light volume. No trades in mind here for now. Gold rose again, up $10 on the futures. The XAU lost almost 2 points though. ABX down 1/2, GG lost 2/3 and NEM fell 1/4. Volume was light. The US dollar didn't do much today. Earnings are out later this week. I'm thinking of perhaps getting some gold share calls here in the next couple of days as an earnings play. ABX is the issue that I have in mind. Not sure yet if I'm going to risk it though. Mentally I'm a bit tired, did not sleep well. So basically I'm about to attempt another trade and it will be the OEX puts or the ABX calls. I'll ponder things again tonight and go from there.
Friday, July 22, 2011
It was a mixed market today as the Dow lost 43 points today on light volume. The S&P 500 and the NASDAQ were higher though. The advance/declines were positive. The Dow was negative all day. It still has the feel of a market that wants to go higher. I still am thinking about the OEX puts for sometime next week. GE opened higher but closed lower by 1/8 on its earnings report day. Volume was heavy. I think GE may provide a clue for where we are going here with regards to the stock indices but I could be wrong. Gold rose $14 and the XAU gained 2 1/2. The dollar was higher as well. There was a bombing of government offices in Norway that probably helped the flight to safety trade today. ABX up 2/3, GG gained 1 1/8 while NEM edged higher by 1/8. Volume was light. Overbought and staying there for the gold shares. Not sure about getting the calls here. Mentally I'm doing OK. I'll have to check the charts over the weekend. We are overbought on the stock indices but not excessively. The summation index has turned back up. I have been considering getting some OEX August puts and I still am. I'll decide what to do over the weekend. For now it's Friday evening and time for a rest.
Thursday, July 21, 2011
The rally has legs as the Dow gained 152 points on better volume. The advance/declines were almost 4 to 1 positive. We are getting back to overbought on the stock indices but aren't quite there yet. I am now debating on whether to purchase the OEX puts or hold off. This rally so far has thin leadership in my opinion. But that doesn't mean things won't broaden out. It's possible that we are on our way to new yearly highs in some indices. The risk of the OEX puts here isn't justified in taking a position at this time. That's my thought at the moment. GE gained 1/3 on good volume the day before the earnings report. Perhaps the market knows something we don't. If we see some good news there tomorrow it could be telling for the market. Or vice versa. Gold fell 10 bucks today and the US dollar lost ground as well. The flight to safety trade is coming off again. The XAU fell 1 1/8. The gold shares were mixed with ABX and NEM sporting fractional gains while GG dropped over a buck. Volume was average. The gold shares are overbought and I'll need to see an oversold reading before getting the calls there. We will see some movement next week on the earnings. Mentally I'm doing OK, slept well enough. Trying to figure out the proper course of action here going forward. Still plenty of time on the August option cycle with the extra week added. The market has the feel of wanting to go higher in my opinion. I could be wrong. Let's see what happens with GE tomorrow and the markets reaction to that.
Wednesday, July 20, 2011
The Dow lost 15 points on light volume today. The advance/declines were positive. It was a lackluster session following yesterdays huge advance. We will see if it was simply a pause before higher prices or not in the next couple of days. The summation index is trending lower but that could change with another good up day. GE was up 1/4 on light volume, moving above the 200 day moving average line. Earnings for GE are due Friday. That should be a market mover. I have no trades in mind here. Gold lost $4 on the futures and gained as much in the aftermarket. The XAU was up 1 1/4. The US dollar fell today but it really didn't do much for gold. ABX, GG and NEM were all up fractionally on light to average volume. Earnings due next week. If we get weakness soon, I'd like to try the August gold share calls. We'll see. Mentally I'm doing OK but not as focused as I need to be at the moment. That has to change before any type of trade is established. I'm still leaning towards the OEX August puts when we get overbought. We're not there yet.
Tuesday, July 19, 2011
We got a bounce and quite a bounce it was as the Dow gained 202 points on average volume. The advance/declines were over 3 to 1 positive. The idea has been to short any bounce and I'm still leaning that way. I am going to try and wait until we are short term overbought which would be later this week or next Monday. However being both short and medium term oversold here could mean more of some type of sustained upside move going forward. I would still like to see the rally from the US debt resolution first before purchasing some OEX puts. We'll see. GE was up 1/3 on light volume. Trying to get above the 200 day moving average. Hasn't happened yet. Gold lost a buck on the futures but was down $15 in the aftermarket. The XAU fell 1 2/3. The US dollar fell today as well. It looks like fear took a rest today. ABX off 1/2, GG lost a buck and NEM fell 1/3. Volume was average. If we work off the overbought condition here, I may try the gold share calls for August or September. However I would like to see some pullback first. One day isn't enough. Mentally I'm a bit tired, not enough sleep. Today was quite a move in the stock indices. Sometimes in down markets, rallies spring out of nowhere. That could be the case for today. Or not. There lies the dilemma from here. We'll see if we get any follow through tomorrow and go from there.
Monday, July 18, 2011
We started the week off with a whimper as the Dow lost 94 points on light volume. The advance/declines were over 4 to 1 negative. Summation index heading lower, implying that the trend is down. We are oversold here and I do expect a bounce. The fact that we made up half of todays losses makes me think that we should head back to the upside tomorrow. But who knows? I'm still looking to purchase some OEX puts if we get some positive action in the stock indices. GE was down 1/8 on light volume. Still below the 200 day moving average there. Gold continues to be the star as it set another record high today with a gain of $12 and more in the aftermarket. The US dollar was slightly higher but was up more earlier in the session. The XAU rose 2 1/2. ABX, GG and NEM all gained at least 3/4 on average volume. I'd look for the calls here as well if we get a pullback. Earnings out next week. Mentally I'm feeling OK. I suppose I'll wait for a relief rally when the US settles its debt ceiling issues within the next 2 weeks. That's the idea for now.
Friday, July 15, 2011
A mild expiration Friday as the Dow gained 42 points on average volume. The advance/declines were positive. We opened higher and spent most of the day in positive territory. Still oversold here though in my opinion. I think that we'll trend higher from here for a while but that's a guess as usual. I'm still considering the OEX August puts if I feel the opportunity presents itself. GE was off 1/8 on average volume. Still below the 200 day moving average. No trades in mind for GE. Gold was flat on the day but higher in the aftermarket as we approach $1600. The XAU rose 2 2/3. ABX, GG and NEM all had fractional gains to the upside on light volume. I think the gold shares will be going higher even though they are overbought at the moment. I may try some ABX August calls in the near future. The US dollar dropped a touch today. Again, gold had a valid breakout this week in my opinion and the trend is up. Hopefully there will be some type of pullback in order to establish a long position. Mentally I'm doing OK, slept well enough. 2 weeks left in the month of July and the summer has been anything but quiet. We'll see if that keeps up all summer. The August option cycle has an extra week on it so there is really no hurry there. I'm going to try and wait for a decent signal and go from there. If the stock indices rally back up to the recent highs, I'll be getting some OEX puts. If the gold shares pull back a bit, I'll be trying the calls there. That is the game plan at the moment. It is a beautiful summer afternoon and time to take a break.
Thursday, July 14, 2011
Again we could not hold a gain as the Dow lost 54 points on average volume. The advance/declines were well over 3 to 1 negative. Still short term oversold here and I would expect something to the upside very soon. But I certainly don't know how long that would last. The US debt problem is grabbing the headlines for now. I'm quite sure this will be settled soon and that we will see some type of rally when it does. This is the rally that I'd like to get short if it happens. Otherwise we're just going to head lower here and there won't be a chance to get some August OEX puts. We'll see what happens. GE was flat today on average volume. Nothing new to report there really. Gold was up $3 but the XAU fell 1 1/2. The US dollar was flat after selling off early. ABX, GG and NEM all had fractional losses on light volume. We're overbought on the gold shares but this just may be a pause in the uptrend. Earnings will be out in a couple of weeks. Might try the August calls there but it depends on the overall market itself. However, it was a valid breakout for gold as the volume confirmed it. That must be remembered. Mentally I'm doing OK, another dentist appointment this morning. In order to be successful you've got to pay attention. Only so many interruptions can be tolerated. Expiration Friday tomorrow so we'll have to keep an eye on that. The summation index is probably heading back down after today as well. Interesting times.
Wednesday, July 13, 2011
We managed a gain today but it wasn't all that pretty as the Dow rose 44 points on light volume. The advance/declines were 2 to 1 positive. We were up over 150 early but could not hold the advance. I am hoping we get more of a bounce than this in order to position myself with some August OEX puts. We are short term oversold here. GE was up an 1/8 but the daily candlesticks look bearish here. Try to hang around the 200 day moving average here. Gold continued the breakout to the upside, gaining $23. The XAU rose 5 2/3. ABX and NEM gained 1 1/2, while GG added 1 2/3. Volume was good. The US dollar fell today on hints of a QE3. Will it ever stop? Probably not. The July gold share calls were the right play for this option cycle. Perhaps if we get a pullback in gold to the breakout point of this week, maybe the August calls would be correct. However if the overall market tanks it would probably take the gold shares with it. We'll see. Mentally I'm doing OK. The stock indices are acting very weak here and that is strange following such a strong up move recently. I am really not sure what to make of it. 2 days left in the July option cycle. August has an extra week on the options. I suppose I will simply let this week pass and go from there. The volatility increase lately hasn't made things any easier. I really need to be up to the task. I have an idea of what I'd like to do here so we'll see if the market cooperates.
Tuesday, July 12, 2011
The Dow tried to bounce today but it failed and we lost 59 points on the day. The advance/declines were negative and the volume average. Getting to short term oversold but not there yet. The idea here is to buy some August OEX puts on a bounce if we get a sustained one. Volatility remains above normal for the summer. No big news today but the fact that we couldn't hold the gains of earlier today is not a positive. GE lost about 1/4 on average volume. Just broke through the 200 day moving average to the downside. We never got near the resistance for GE and maybe that was telling for the action we're seeing now. That's a guess as usual. Gold continues to shine here and is breaking out to new highs. It gained $13 and more in the aftermarket. The XAU rose 5 1/2. The dollar was higher today as well. ABX up 1 1/8, GG climbed 2 1/8 and NEM was up a buck. Volume was good. I had a thought early in the day to buy some gold share calls but didn't do it. It looked like they were going to rally and they did. I just didn't take the risk. This looks like a valid breakout for gold and I may just want to jump on board. It will be something to think about tonight. Mentally I'm doing OK. I'm still sticking to my theme of getting some OEX puts for August but I will need to see some upside first. 5 weeks for the August options so they are are bit pricey here. Money is coming back into gold and the gold share earnings are due at the end of the month. Short term overbought here though. Plenty to ponder. I'll check the charts tonight and go from there.
Monday, July 11, 2011
A rough start to the trading week as the Dow fell 151 points on light volume. The advance/declines were over 5 to 1 negative. Back to the troubles in Europe as now Italy is the latest country to unwind. I get the feeling that this isn't going to stop anytime soon. There are only so many times you can bail people out. I'm looking at the August and September OEX puts on a bounce back if we get one. The US debt problem isn't a problem in my mind. Some type of deal will be worked out. Perhaps we'll get a rally on that. The recent up move has been spectacular in my opinion. But I don't think that it has legs now. We'll see. GE was off 1/3 on light volume. It is now back at the 200 day moving average. No trades there for now. Gold was up $7 and that much more in the aftermarket. The XAU fell 3 1/8. The US dollar put in a good day as well. The flight to safety trade has returned. ABX, GG and NEM all had fractional losses on light volume. I may also try the gold shares for August and September as well if we get to some type of oversold level. If the Gold/XAU ratio climbs above 8, I may put on a trade then as well. However it is hard to get long gold when the US dollar is rallying. We'll see. Mentally I'm doing OK. The summer continues to be overly busy and volatile. This isn't the normal course of things. I will have to make the adjustment. 4 days to go in the July option cycle and I will not be trying anything this week. That's the thought at the moment. So I will look for some type of rally back to the highs of last Thursday and purchase some OEX puts if that occurs.
Friday, July 08, 2011
Some downside action today on the weak jobs report as the Dow lost 62 points on light volume. The advance/declines were over 2 to 1 negative. We were off by 150 points in the morning. However nothing seems to be able to derail this market at the moment. It has all the signs of going higher, for whatever reasons. Working off the overbought condition for now. I would expect new yearly highs before option expiration next Friday. The market always knows more than you and me. GE was off 1/3 on better volume. I would say that it's a warning sign for the stock indices here but GE has been lagging and not leading. Back below the 50 day moving average on the daily charts. No trades in mind there. Gold was up $11 today but the XAU fell 1/3. ABX, GG and NEM were either flat or had small fractional moves on light volume. The dollar gained ground today and it didn't stop gold. Money is moving into gold and I have no reason for it. I suppose I will take a closer look at the gold shares over the weekend. Mentally I'm feeling OK. The summer has been anything but quiet so far. Unfortunately for me, I haven't been able to take advantage of it. The stock market wants to go higher. I think that will be the case going into expiration week. The usual inverse relationship between gold and the US dollar isn't happening right now. You would expect the dollar to have fallen today on such a weak jobs number. Didn't happen. I'm keeping an eye on things but I really don't have a very good feel or idea what is going on. For that reason, I've remained on the sidelines. I'll be looking at the charts over the weekend to try and find something worthwhile. But for now it's a Friday afternoon in the summer and time for a break.
Thursday, July 07, 2011
It has been an amazing run with no end in sight as the Dow climbed 93 points on average volume. The advance/declines were 4 to 1 positive. I thought it would be a quiet session but that was not the case. The employment report is out tomorrow but there is no stopping this bull run for now. Overbought, staying there and the summation index continues to gap higher. Certainly would have been nice to have some calls at some point in the last 2 weeks. GE was up 1/4 on better volume as it tries to break through the 50 day moving average. We still have yet to rise above the resistance line that began back in February. I suppose GE isn't exactly a leader here. Gold was up a buck and the XAU gained 2 points. ABX was flat, GG gained 7/8 and NEM rose 3/8. Volume was average. The US dollar was weaker today. No trades in mind for the gold shares just yet. Mentally I'm feeling tired, did not sleep well or long enough. So we'll get the employment numbers tomorrow but I get the feeling they won't really matter. Not when you get a bull market thrust like the one we're in at the moment. But nothing I've been thinking of has been correct lately. We will have to wait for the stock indices reaction to the news. The Dow transports have already broken out to new yearly highs. Are other indices to follow? Seems to be what will happen at this point.
Wednesday, July 06, 2011
The Dow continued its winning ways as we gained another 56 points today on light volume. Light volume seems to be the norm these days. The advance/declines were about even. Overbought and staying there. Summation index continues to go higher. Overdue for a pullback. That said, you don't want to step in front of a freight train either. I don't have any OEX trades in mind except for perhaps some puts before the employment report on Friday. However after the last losing trade the prudent course of action for me will probably be to remain on the sidelines. GE was flat on the day with light volume. Stalling at the 50 day moving average. Gold was up again today, tacking on $16. The XAU gained 1 2/3. ABX, GG and NEM all had slight fractional gains to the upside on average volume. The US dollar was up again as well. Again, the question is why is gold moving up so much this week? I don't have an answer. Technically speaking we're not even close to overbought yet. Perhaps I'll have to take another look here. The gold share earnings will be out at the end of this month. Mentally I'm doing OK. No summer doldrums yet as the stock indices continue to move higher. I'd expect tomorrow to be a waiting game for the employment report but who knows? I'd like to find a trade for the July options here but nothing stands out. We'll see what tomorrow brings.
Tuesday, July 05, 2011
It was a relatively quiet post holiday session as the Dow lost 14 points on light volume. The advance/declines were about even. It was a mixed bag as the NASDAQ showed a slight gain. We're still overbought here but the market has the feel as though it wants to go higher. However some type of pause is due. GE was off a bit on light volume. Still below the downtrend line from February/May. Gold was up $16 after being up $10 yesterday. The XAU gained 5 points. ABX up 1 1/8, GG rose 1 7/8 and NEM gained 2/3. Volume was light. It looks like the RSI positive divergence for ABX is working. I have no explanation for the recent jump in gold. We were oversold but it has been quite a 2 day move. The US dollar was higher today as well. Something is going on but I certainly don't know what. Mentally I'm doing OK. A nice long weekend in the summer is always nice. 8 days left on the July option cycle. I don't really have any trades in mind at the moment. The employment report is out on Friday and that should be the next trigger for some type of sustained move. That's my guess at the moment.
Friday, July 01, 2011
We ended the week and started the second half of the year with a July 4th bang as the Dow exploded to the upside with a gain of 168 points. The advance/declines were 4 to 1 positive and the volume was light. The gaps in the summation index are expanding and that usually means that the rally has staying power. I left in the open order for the OEX puts and was filled this morning. That was a mistake. Obviously I should have simply canceled the order yesterday when I began to have my doubts about this trade. I bailed out later in the day today for a 30% loss to start the second half of the year. Not a lot of money in this trade but the mental capital drain is always more important. The stock indices had a great week. It's not often that you get an over 5% gain on the S&P 500 but we did it this week. We've broken through the daily downtrend line and the trend is up. GE was up 1/3 and the volume was good. Approaching the 50 day moving average. No trades there for now. Gold did not participate with the rally and lost $20 on the futures. The XAU fell 1 2/3 but was lower during the day. ABX dropped 1/2, GG lost 7/8 and NEM shed 1/4. Volume was light. The US dollar was flat on the day. Gold is losing its luster here for traders. We're oversold on the dollar here though. However the flight to safety trade is no more. Commodities have been falling as well and that isn't supportive to gold. Perhaps I'll look for the gold share calls later this summer. Mentally I'm doing OK. Another losing trade doesn't help matters. But at least when I made a mistake this time, I was able to admit it and get out. It's part of the game. I have no explanation for the markets strength this week. However the market knows things that we don't. Plus the market is never wrong. The fact that we rallied so much today on a day that would normally be quiet and slow says something. Perhaps we're going on to new highs for the year this summer. Time will tell. The long July 4th holiday weekend is upon us. It's a nice summer Friday and time for a rest.