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Tuesday, October 09, 2012

Weakness today as the Dow fell 110 points on light volume.  The advance/declines were 3 to 1 negative.  The summation index will be back to heading lower.  We closed almost on the low of the day for the S&P 500 and that isn't exactly bullish.  A decline in the early part of this week was expected.  The uptrend line from June comes in at around 1435.  We need to hold on there or the game will be changed.  Haven't broken it yet but beware if we do.  1435 would be a logical spot to get some calls if you were so inclined.  I've had a bullish stance on the overall market for a while but the technicals have rolled over.  I'm on the sidelines with regards to the OEX as the time to buy the puts there has probably already passed.  GE fell 1/3 on average volume.  The same story here as the technicals are heading south.  No trades here for me now.  Gold fell $10 on the futures as the US dollar had a good day.  The XAU dropped 4 points.  We've got the technical rollover here as well.  ABX off 7/8, GG fell 1 1/2 and NEM down 1 1/4.  Volume remained light.  I adjusted down the strike price for the November ABX call order.  I will have to ponder this trade tonight because if the overall market starts to fall here, the gold shares will most likely follow suit.  Mentally I'm feeling OK.  Important session tomorrow for the stock indices in my opinion.  We're not overbought or oversold at this juncture, so anything is possible.  I'd like to see the rally continue but that doesn't mean that it will.  So we'll see what happens.  I'm still a believer for higher gold prices in the future.  However this market can get moving pretty fast one way or the other at times.  If we break down from these levels it could get ugly pretty fast.  Again, hasn't happened yet and I'm still ready to try the gold share calls here.  Perhaps going further out to January is a possible trade.  I'll consider that tonight as well.  We'll watch how the foreign markets react to todays US stock index action and go from there.  

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