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Friday, September 14, 2012

The rally continues as the Dow tacked on another 53 points on heavy volume.  The advance/declines were 2 to 1 positive.  All signs point to higher prices as the stock markets attract capital.  Liquidity abounds.  There is plenty of money to go around the world.  In some sense it doesn't matter what the economy does for a while as long as the flow of money continues into stocks.  Price and volume confirm the move higher.  I'd expect the upcoming expiration week to have a positive bias.  GE up 1/8 and the volume very heavy once again.  If we can back back close to the 50 day moving average on a daily basis, I'll probably give the October calls a look.  Overbought and staying there for now.  Gold was up a bit on the futures.  The US dollar has completely broken down.  If we get a snap back in the dollar perhaps gold will drop and that could be the next entry point for the precious metal.  Or we might just continue going parabolic.  The XAU gained 5 1/3.  As long as the gold shares outperform the metal itself all systems are a go for higher prices.  ABX and GG gained 3/4 while NEM added 1 3/4.  Volume was very heavy once again.  I'm going to try and be patient before attempting the calls here again.  But we are going higher here as well.  Mentally I'm doing OK.  With only 5 days remaining in the September option cycle I probably will not be trying a short term trade.  It is hard to watch the gold shares rally when I sold mine early but I have been down this road before.  There will be a reaction and another chance at the calls but I'm going to have to wait for it.  I'll be checking the charts over the weekend.  For now it's Friday afternoon and time for a break.

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