Wednesday, July 11, 2012
5 days in a row to the downside as the Dow fell 48 points on light volume. The advance/declines were slightly positive though. The market didn't like the Fed minutes but did stage a last hour comeback to cut the loss more than in half. I'm pretty sure that the OEX July calls are the way to go here for a short term trade. The daily technicals on the stock indices are at the same level where they bounced before. The only drawback here is the apathy from the players. There really isn't any interest from the buy side but we could at least see a short covering rally. That's a guess as usual. If we get some weakness again tomorrow, I might try those OEX calls. GE was up a touch today on light volume. The short term technicals are oversold here as well as we approach the 50 day moving average. No trades for me here though. Gold took a slight hit on the Fed and the slightly higher US dollar. The precious metal futures were off around $5. The XAU continues to under perform, losing 2 2/3. ABX dropped 2/3, GG fell 3 1/2 and NEM shed 3/8. Volume was above average for the gold shares and extremely heavy in GG. GG announced a shortfall in production for the year and got clobbered. My ABX calls remain in the red and could be on the way to the graveyard of failed trades. There is a chance that we are putting in a double bottom for ABX on both the daily and weekly charts but it will depend on where we close for the week. That will be the only chance for this ABX August call trade to be profitable. Mentally I'm feeling a bit tired, did not sleep well. I'd like to perhaps try the OEX July calls here but I am still stuck in the ABX trade. I don't know if I'd like to put on more risk. I'll see what happens tomorrow morning and go from there. There really isn't a catalyst out there for higher prices that I see but the market will go where it wants to. We've had plenty of bad news lately and the stock indexes have held up rather well. Plus we have expiration week coming up which usually has a positive bias. So we'll see. I'll keep an eye on things overnight and go from there.