Wednesday, July 25, 2012
We broke the losing streak for the Dow today with a gain of 58 points on average volume. The advance/declines were positive. It was an up and down type of day in the stock indices. A mixed market as both the S&P 500 and the NASDAQ were lower on the session. Short term oversold now for the market and a bounce is to be expected. With the summation index heading lower, I would expect any rally attempt to be short lived. I could be wrong. GE was flat on the day and volume was lighter. GE has had pretty good relative strength lately. That is a plus for the bullish case going forward if GE is a proxy for the overall market here. Gold had a strong day on the weaker US dollar. The yellow metal rose $30 on the futures. The XAU was up only 4 points as the gold shares continue to disappoint. ABX rose 2/3, GG up 1 1/8 and NEM gained 1 1/2. Volume was slightly above average, which is a positive. NEM was the leader and that is usually a positive as well. My October ABX calls are slightly in the black but the ABX August calls I own are losers and will remain so barring a miracle. Earnings are out tomorrow for ABX and that should be a mover one way or the other for this stock. We'll see what happens. Mentally I'm feeling OK. The S&P 500 is trying to hold on at the 50 day moving average on the daily chart. I'm guessing that the GDP report out on Friday could be a market mover but it will be summer Friday. So the all the usual participants may not be around. Gold had a strong day for a change. My thinking here is that if the GDP report is weak on Friday then gold will continue to rally on expected easing down the road from the Fed. That's a guess as usual. We didn't hear anything out of Europe today but that could change at any minute. Headline risk remains. We'll see how ABX reacts to the earnings report and take it from there.