Friday, September 28, 2012
We closed out the month to the downside as the Dow fell 49 points on light volume. The advance/declines were negative. I would have liked to have seen some follow through to the upside following yesterdays gains. But it didn't happen. I still think higher prices are coming and that we will take out the recent highs in the S&P 500. But I could be wrong. The summation index is pointing down. We are short term oversold here on the stock indices but we haven't gotten a decent bounce. Perhaps the beginning of the month money flows on Monday can get us going to the upside. No major trend lines have been broken so I'm sticking with a bullish stance. GE lost just a touch and the volume was heavy. We're not short term oversold here, in fact it's just the opposite. I'm not looking to trade GE here. The gold futures fell $6 on the day as the US dollar had a decent move to the upside. The fact that gold didn't drop that much lets you know that the money simply continues to flow there despite being overbought. That won't last forever but you cannot fight it. The XAU was off 1 1/8. ABX, GG and NEM all had fractional losses on average volume. I canceled the open order for the October ABX calls. No need to leave that out there over the weekend. I'll consider what to do in the next couple of days and then decide whether to place another order. I'm pretty sure that I will but perhaps at a different strike price or price. Mentally I'm feeling OK. As usual the question is where do we go from here for the stock indexes. I'm still a believer in higher prices. We've got plenty of economic data out next week with the employment number on Friday. So we will see where the market takes us. Gold remains an attractive place for money to go from what I can see. Nothing has stopped that trend yet. I will look over the charts this weekend and try and come up with some type of trade for next week. For now it's Friday afternoon and time for a break.