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Monday, August 12, 2013

Another summer Monday as the Dow fell a few points on very light volume.  The advance/declines were positive.  A mixed bag today as the NASDAQ posted a gain.  I'll be looking for the positive upside expiration bias in the stock indices for this week.  After that, who knows?  I'm still interested in the September OEX puts but will probably let this week go by before purchase.  The summation index is still heading lower though.  Plenty of economic data to sift through this week as well.  Patience is an overlooked skill.  GE was flat on the day and volume remains light.  Gold found some buyers as the futures rose over $20 despite a touch of upside in the US dollar.  The XAU gained 5 points.  It is encouraging for the bulls here to see the gold shares and gold finally move in tandem.  ABX up 3/4, while GG and NEM added about 1 1/2.  Volume remains goods here and that is a positive as well.  We are also breaking out above some down trend lines in the gold shares.  I have no reason for the upside at this time but the positive technicals should not be ignored.  Of course it could all change tomorrow in this game.  Mentally I'm feeling a bit tired.  The small stocks continue to outperform here despite negative divergences in some of the major averages.  So we are getting mixed signals.  I'm still going to be looking to get short above 1700 on the S&P 500.  I could be wrong.  The other problem we have here is the calendar.  It's summer and the major players are on vacation.  That's why it doesn't hurt to be patient.  Gold is moving higher for some reason and I would only be guessing if I tried to explain it.  We'll stick with the technicals and we made it through the 50 day moving average today.  If we can get past $1350 then perhaps we can make a run at $1400.  My October ABX calls are now back to solidly in the black.  But we all know how that can change.  We'll keep an eye on overseas developments this evening and then move on to the retail sales report tomorrow morning.

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