Tuesday, May 12, 2015
The market got clobbered early but finished the day with a loss of 37 points. The advance/declines were negative and the volume was light. We were off 150 early and eventually made it all the way back to positive before rolling over again. When we were down, I did not get any SPY May calls although that probably would have been the right move. A market that can come back from such a drop, isn't one that is going much lower in my opinion. I think that I'll be staying on the sidelines now with regards to the S&P 500 May options. GE was up 1/8 on light volume. June or July calls here remain the game plan. The gold futures were up almost $10 on a weaker US dollar. The XAU rose 3/4 and GDX gained 1/4. Volume remains on the light side. Patience is advised here. Mentally I'm feeling OK. Although the summation index is still heading lower, I really think that we are about to hit new all time highs again. That's a guess as usual. It is option expiration week and it usually has a positive bias. The comeback off of the lows today was impressive. Retail sales tomorrow should provide some excitement. Bond yields have risen pretty fast in the past few weeks. As we come back off of that, the market should rally. The technicals right now are not giving any solid signals for the major stock indices. It looks like I'll be moving into the June option cycle which has an extra week in it. Gold found some buyers today but it remains range bound. Nothing to do here but wait. We'll watch the foreign markets overnight and go from there.