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Tuesday, September 17, 2013

The levitation continues as Dow rose 35 points om light volume.  The advance/declines were 2 to 1 positive again.  Tomorrow will be the key as we are breaking out to new highs today on some of the stock indices.  I'd expect some major price movement one way or the other.  The summation index continues to the upside and it is hard to fight that.  I still think it will be a sell on the news event but what do I know?  Not much.  The technicals remain overbought and have been.  This condition will not last indefinitely.  The expiration week upside bias appears to be in place for now.  My October OEX puts are showing a loss.  I'll have to dump them if we get an upside breakout tomorrow.  GE was up 1/3 and the volume was average.  We got through $14.25 and it appears that higher prices are in the near future.  Those September 23 calls look good at the moment.  Opportunity lost there.  Gold fell 8 bucks on the futures and the US dollar was a bit lower as well.  No normal correlation there lately.  The XAU gained 1 1/2.  ABX, GG ands NEM all had fractional gains on light volume.  I may try the ABX calls again tomorrow if we get some upside in gold itself after the Fed announcement.  It will not be an easy trade to make so we'll see.  The up trend line for ABX remains in place as it does for the XAU for now.  Mentally I'm feeling a bit tired, did not sleep well.  So all the players are waiting for tomorrow.  Whatever the Fed does, the market reaction is what to watch for.  3 days to go in the September option cycle.  Perhaps we will simply run up into the close on Friday.  I'm not counting on that though.  The stock indexes are overbought and staying there.  Gold is oversold and staying there.  The gold share indexes have held their up trend lines that began in the beginning of July.  That is why I think that if we get a rally in the gold shares tomorrow it could have legs.  That's a guess as usual.  Tomorrows action should give us a clue as what to expect for the rest of the month.  We'll keep an eye on overnight developments and wait on the Fed tomorrow.     

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