Tuesday, June 30, 2015
The market stopped going down today as the Dow gained 23 points on heavy volume. The advance/declines were positive. The summation index continues lower. The markets are hostage to the Greek drama. With a potential vote on the euro there not due until Sunday, you get the idea of the situation that we're in. Oversold and staying there technically for the major market averages. It is not impossible to trade here but it is a guessing game with the headline effect in play. You will want to be long at some point but nobody knows when that point will be. I'll probably not try the SPY July calls at this rate. GE was off a few cents and the volume was average. I did place an overnight order for some GE July calls but it wasn't filled. I'm willing to try the calls here because the technical set up is in place to get long. What I mean by that is on the weekly charts we had a high volume breakout from a consolidation zone and we are now falling back to test the zone. It should hold and GE should move higher from there. Timing is the key as usual. Gold was off $7 today as the US dollar was higher. No flight to safety for gold and that is a negative despite being oversold on a short and medium term basis. The XAU and GDX continue with fractional losses. Gold, silver and the precious metal shares all are on the verge of breaking down out of their congestion zones on the weekly charts. I am still considering the ABX October calls though for the seasonal rally trade. Mentally I'm feeling OK. The question is what to do here and there are no easy answers. You can only guess which way the Greek vote will go if we get that far. We also have a long holiday weekend coming up in the US. The McClellan oscillator was in the area that it has bounced from recently after yesterday. If today was all the bounce we get, then we're heading lower. The summation index is passing through the zero line and that's trouble as we have seen. I'm remaining cautious here and will probably only attempt the GE trade in the next couple of sessions. Beginning of a new month tomorrow so usually there would be some positive money flows. But anything goes in this current state of affairs. The employment report on Friday will only be a sideshow in my opinion. Yesterday the overnight action was positive and that helped stem the decline. We'll see how it goes tonight. Interesting times.
Monday, June 29, 2015
Well, so much for the summer doldrums. The Dow fell 350 points on good volume. The advance/declines were almost 10 to 1 negative. The summation index is heading lower and about to go through the zero line. This area is rarely breached and when it is, the market falls apart. That is what we have going on here. Crash is another term folks like to use but it seems events are more controlled these days. The Greek drama took a turn for the worse. I'll be the first to say that I did not see that coming. I figured we would get the usual last minute deal and be done with it. I also thought that the summation index would turn around before it broke the zero line. Obviously, I was wrong. At least I didn't buy any calls last week. GE was off almost 1/2 on good volume. I did place a couple orders here for the July calls but they were not filled. I may try again tomorrow but the risk in getting long anything here is very high. That said, this could be an opportunity for a decent trade if the timing is correct. But I must admit in a headline driven market environment, it will be like playing with fire. Gold could only manage a $5 gain on the futures despite the turmoil and the fact that the US dollar got crushed today as well. If this is all gold can do in times like these then perhaps not trading gold at all is the correct path going forward. The XAU and GDX had fractional losses on summer average volume. Why both gold and the US dollar didn't have big rallies today is the question. My thought is that what we are seeing is a worldwide margin call, with players selling whatever they can to cover their exposure. That's a guess as usual. Mentally I'm feeling a bit tired after a volatile trading session. But where do we go from here? The Greek drama has the markets full attention and it won't be settled for at least a week as of today. Trading in this atmosphere is dangerous. If you can get long close to the bottom, you'll do fine. But nobody knows where the bottom is. We are oversold and staying there. I'll be checking the charts tonight but we are in no mans land. I would still like to try the GE July calls though. The technical set up is textbook so far but could be negated due to the market unrest. I probably should have the discipline to just step aside here and let the market settle itself out. I will most likely attempt this trade in the coming days but not with a lot of money. However my ideas lately and my take on the market situation have been off the mark lately. We get the end of the month and quarter tomorrow but it probably won't matter. Plus the employment report on Friday. The market is controlled by whatever happens in Europe at the moment. We'll see if the foreign markets continue lower overnight as we are held hostage by the headlines overseas.
Friday, June 26, 2015
A day of indecision as the Dow gained 56 points on very heavy volume. The advance/declines were negative. It was a mixed bag as the small stocks were weaker on the day. That's not a positive. It appears we have some early end of the month and quarter moves going on. I did place another order for some SPY July calls but it wasn't filled. I'm a believer that weakness can be bought on Monday if there is any. The Greek saga should be settled over the weekend. We may just rally on the open when the market reconvenes. GE was up a nickel on light volume. I put in an order for the July calls here as well and wasn't filled. Perhaps I'll try again next week. Gold was little changed today but did come off of its lows. The US dollar was up a bit. The XAU and GDX had fractional losses on light volume. Still no interest here. I am going to try the ABX October calls at some point. Mentally I'm feeling OK. Earlier in the week I propositioned that Monday would be the ideal time to try the SPY July calls. Perhaps the market will actually cooperate this time around. We are not completely oversold on the major averages as the short term technical indicators are merely mid-range. However one of my other short term tools will be giving a buy signal if we are negative on Monday. I'll consider my options over the weekend. A short holiday week coming up with the end of the month and quarter thrown in. Plus the employment report on Thursday of next week. So there will be a lot for the market to digest. The summation index is still heading down but I expect it to turn back up in this area. I could be wrong. Gold remains unattractive now even with the Greek dilemma. The fundamentals here are negative with the stronger US dollar and the Fed looking to raise rates. However I will be looking for the seasonal rally to take place in roughly the July-September time frame. The gold shares are oversold on both the short and medium term. They are unloved and look like they are about to break below the recent nine month consolidation zone. If that happens things could get worse in a hurry. Hasn't happened yet but it's something to keep a close eye on. So there will be plenty of things to ponder over the weekend. For now it's Friday afternoon and time for a rest.
Thursday, June 25, 2015
Another weak session as the Dow fell 75 points on summer average volume. The advance/declines were about 2 to 1 negative. The summation index is now heading lower. Still no resolution for Greece and the next meeting is this weekend. The short term technical indicators for the major averages have rolled over but they are still in the overbought zone. I did place an overnight order for some SPY July calls but it wasn't filled and I canceled it during the session. Weakness in the final hour the past 2 days isn't a positive. However I will maybe attempt this trade again tomorrow. GE was off almost 1/4 on light volume. The techncials have rolled over here as well. We are at the 50 day moving average here. The July calls here are still on my radar. Gold again was off just a bit as was the US dollar. If Greece is about to blow up, wouldn't you expect to see a rise in gold? Maybe I'm just not seeing things correctly. The XAU and GDX had fractional losses on better volume. I'm still interested in getting some ABX October calls. I suppose when the weekly charts are oversold I'll give them a shot. Getting there but not yet. Mentally I'm feeling OK. Could the market fall apart here on a Greek debacle over the weekend? Well yes, it could because it is an unknown if it happens and the market likes certainty. I guess the question is whether it will or not. We need to stick to the technical indicators though. The TRAN just broke to a fresh low. But the small stocks are holding up better here. The summation index is moving lower but is in an area that it has turned around in the past. So we have a few conflicting signals and that makes the trading tougher than usual. If we do head lower tomorrow, I'll probably try the SPY July calls again. But the sidelines may just be the best place to be. A case can be made to let this Greek drama play out and then trade from there. Or I could simply focus on the GE trade only. I'll consider the various scenarios overnight and try to come up with a profitable strategy. We'll see if the overseas markets follow the US lower overnight.
Wednesday, June 24, 2015
Stocks took a hit today as the Dow fell 178 points on light volume. The advance/declines were over 2 to 1 negative. This should move the summation index back down again but the pattern here appears more sideways to me. Perhaps more of the Greek drama fears again. But we can't just dismiss todays price action. The overall market wasn't as weak as the Dow which is a plus. But the TRAN got clobbered today and is about to make a new low. The ideal scenario would be sideways to lower into Monday and then purchase some SPY July calls. However the market rarely obliges you. GE was off almost 1/3 on average volume. Perhaps there will be a chance for the July calls here after all. Gold was off a bit on the futures as was the US dollar. The XAU and GDX were little changed again on light volume. There's a chance that ABX is putting in a bottom here but I'm inclined to wait for lower prices. Mentally I'm tired as I did not sleep much last night. It isn't a good idea to trade in a slower mental condition. The major stock indices are still overbought. We closed on the low of the session and that's bearish heading into tomorrow. The revised GDP final number was a non event. We've been in a trading range for the past 4 months. A breakout is overdue. I'm still a believer in new all time highs coming but I could be wrong. I'm going to have to look things over again tonight and come up with a game plan for tomorrow. Perhaps the sidelines will have some appeal but we'll have to see what happens overnight. Gold was still weak today so there wasn't any apparent flight to safety. A good nights sleep and a fresh start tomorrow is the best course of action in my mind. We'll see what unfolds in the foreign markets and go from there.
Tuesday, June 23, 2015
Not much going on today as the Dow gained 24 points on light volume. The advance/declines were positive. The summation index is heading higher grudgingly. There really isn't much to say about todays price action. In my mind the trend is still up and I'd like to get some SPY July calls if we see a pullback. The short term indicators are overbought for the major stock indices but that doesn't mean that they can't stay that way. Greece has yet to resolve itself but that is supposed to happen soon. Perhaps we'll get a sell the news event. That's a guess as usual. GE was up 1/8 and the volume was summer average. It doesn't look like I'll get a chance at the July calls here but we'll see. Gold was off $7 on the futures as the US dollar gained a full point today. Both the XAU and GDX barely moved today on light volume. The gold shares are oversold and on the verge of breaking medium term support on the weekly charts. A breakdown will probably take the October gold share call trade off the table. But it hasn't happened yet. Gold is still above the $1150 level, which I feel is the key support at this point. However the fundamental picture for gold here is negative in my opinion. I'll keep an eye on developments going forward. Mentally I'm feeling OK. Although we are in an overbought market environment, I'm still leaning bullish and I'd still like to own some SPY calls. I do believe that we will break out to new all time highs on the S&P 500 during the July option cycle. I'm remaining patient for the gold share trade at this time. We watch the foreign markets overnight and see the reaction to the final GDP number tomorrow.
Monday, June 22, 2015
Back to the upside post expiration as the Dow gained 103 points on light volume. The advance/declines were positive. The summation index is moving sideways as we have yet to have a solid break higher here. But I do believe that it will be coming. I'd still like to try the SPY July calls at some point. However the short term technical indicators for the major stock indices are overbought. We are also moving day to day with the situation in Greece. Supposedly that problem will be solved by the end of the week. GE was up 18 cents on light volume. We'll need to see a run back to the bottom of its sideways channel in order to attempt the July calls here. Gold futures fell $17 today on a positive US dollar and the good news on Greece. The XAU shed a point and GDX lost 1/3. Volume was light. The gold shares bounce of last week looks false and we are heading lower. We are getting medium term oversold and the time to buy the October gold share calls is approaching. I'm still looking at the ABX calls as the vehicle of choice. Mentally I'm feeling OK. A good start to the week for stocks but we'll need to see a pullback to get long. Otherwise this will be another missed trade. The small stocks continue to lead the way here and that's a positive. Not a lot of economic data out this week. The final GDP revision on Wednesday could be a mover. However with the beginning of summer the doldrums can appear at any time. The trading is never easy and sluggish markets don't help the matter. The daily gold candlestick chart has a bearish pattern after todays price action. A resolution of the Greek drama would probably put further pressure on the precious metal. Patience is still advised here. We'll keep an eye on the overnight developments and see what tomorrow brings.
Friday, June 19, 2015
A downside expiration as the Dow fell 100 points on heavy volume. The advance/declines were negative but not as much as a down 100 market would suggest. The summation index could turn back down after today or perhaps it is moving sideways. This could be the technical snap back that I am looking for. However with the unsettled situation in Greece, there is a chance that it is more. And that is the problem here. The market is susceptible to headline risk. The short term technicals are more overbought than oversold at this point. I'm still leaning bullish here though. GE was off 1/8 and volume was expiration heavy. The Bollinger bands here on the daily chart are getting so tight that a breakout one way or the other is imminent. I still think the resolution will be to the upside and I still like the July calls here. Gold was pretty much flat on the session and the US dollar had a mild gain. The XAU was off 1 3/4, while GDX lost 1/2. Volume was average as the gold shares had poor relative strength vs. gold today. Not sure exactly what that means but it could simply be expiration related. With the uncertainty in Greece, I would have expected more of a flight to safety for gold and the US dollar. As I've said before, perhaps the market knows more than we do. Mentally I'm feeling OK. I'm going to have to go over all the charts this weekend to come up with a strategy for next week. There's another meeting about the Greek tragedy on Monday. I don't know how long this saga will last this time. The markets are being held hostage. But it will get resolved one way or the other eventually. The RUT hit a new high yesterday. With the small stocks out performing and the summation index in a zone where it has turned around in the past, I can't be too bearish here. I still think that a summer rally is in the cards. I'll probably be looking at the SPY July calls and the GE July calls as well. But those decisions will have to come over the weekend. The recent bounce for gold stalled today and the gold shares traded lower. I'm going to remain patient there for now. The ABX October calls remain on the radar but the purchase will be put off until they get short term oversold again. This trade remains viable as long as gold holds the $1150 level. Plenty to ponder in the next couple of days. For now it's Friday afternoon and time for a break.
Thursday, June 18, 2015
Moving higher as the Dow gained 180 points on good volume. The advance/declines were 2 to 1 positive. Todays action should turn the summation index back to the upside. The down trend line of the last four weeks in the S&P 500 has been broken to the upside on good volume. Declines can be bought in my opinion. Technically I'll be looking for a snap back to this line to get some SPY July calls. The Greece situation wasn't resolved and the meetings will now be ongoing. Expect some type of resolution there. This is the beginning of the summer rally in my mind. I am hoping it is not too late to profit from it. GE was up 1/3 on good volume. May have missed this July call trade but we'll see. Earnings are due the day of the July option expiration. Gold moved higher as the futures gained $25 but some of that was from the aftermarket yesterday. The US dollar was lower today but did finish off of the lows for the session. The XAU added 7/8 and GDX rose 1/4. Volume was lighter than yesterday. I expected more upside here out of the gold shares considering the gains in gold itself. So perhaps the October call trade still could work. The ideal timing for this purchase would be sometime in July. That's my best guess at the moment. Mentally I'm feeling OK. It looks like buying the June SPY calls on Monday would have been the proper strategy. But it doesn't matter now. The bigger picture has stocks turning higher here and I think for more than just a week. The TRAN had a nice move higher today as well. So I feel that call buying for July is the right move from here. The proper timing will be one of the keys as usual. I'm probably going to buy some SPY July calls if we get a move back towards the broken downtrend line. If that doesn't occur then I will have to look for something else. GE remains on the radar as well but it isn't as volatile as we all know. I'm still being patient for the gold share trade at this time. So there you have it. We'll watch what happens overnight and close out the week with expiration Friday tomorrow.
Wednesday, June 17, 2015
We got the Fed out of the way and the market liked what it heard. The Dow rose 31 points on light volume. The advance/declines were slightly positive. We were higher during the session but it was a plus day. I'm still bullish here. Once we get Greece out of the way, I think we're heading to new all time highs. That should be resolved tomorrow but we'll see. I could be wrong but I think the summation index is about to turn around. The short term technicals for the major stock averages are mid-range. GE was up a nickel on good volume. The July calls here remain on the radar. Still waiting on an oversold condition for purchase. Gold got a bounce from the Fed as the US dollar dropped. The precious metal futures were down during the regular session but came back around $8 in the aftermarket. The XAU gained 1 1/2, while GDX rose 1/2 and the volume was good. Perhaps now is the time for the gold shares but we'll have to see how the rest of the week plays out. ABX had a solid gain on good volume. I'm not going to chase anything here, as going out to the October options gives us the benefit of time. If we have missed it we'll look for something else. Too early to tell. Mentally I'm feeling OK. It's possible that the market is still trying to sort things out here but I'm a believer in higher prices going forward. The TRAN did continue lower today though. If the current Greece problem isn't solved tomorrow, would that lead to a sell-off? Always questions in the game. Perhaps todays rally wasn't as robust due to the lingering uncertainty. But that's a guess as usual. With mid-range technical indicators we can't be certain about much. We also have the summer market conditions to deal with, which means less players and slower trading. That should probably kick in after this week. We'll watch the foreign action overnight and see if gold has any follow through to the upside. All eyes will be on the Greece and we'll watch the market reaction.
Tuesday, June 16, 2015
Moving higher now as the Dow gained 113 points on light volume. The advance/declines were about 2 to 1 positive. The summation index is heading lower but I do believe it is about to turn around. We've got the Fed tomorrow and even if we head lower, I think it's a buying opportunity. I'm now looking at the SPY July calls. The risk in the June calls is probably too high for me now with only 3 days left before expiration. But you never know. We've still got Greece on Thursday to get through. However it is most likely some kind of deal will come through. But it is a problem that will probably never be solved. GE finished flat on the session after selling off early. Volume was summer average. I still like the GE July calls at some point but would prefer to see a solid oversold reading. Gold was off $5 on the futures as the US dollar was up a bit. Things could get moving here on the Fed tomorrow. The XAU fell a point and GDX shed 1/4. Volume was average. Patience is the course of action here for now. Mentally I'm feeling OK. The TRAN was lower today and you never know how the market will react to the Fed. But I do think we are at a spot where the summation index will turn around. Now I could be wrong and we head down for another leg but I don't think so. If we do get some weakness tomorrow, I'm probably going to try the SPY July calls. I am looking for some type of summer rally to begin and take us to new all time highs. The RUT has held up well here and could be leading the way. So we'll see. Gold remains above $1150 and that is the level to watch in my opinion. The lack of a decent rally in the face of the Greek situation could be all you need to know about gold here. The gold shares are oversold but have remained that way for a couple of weeks. So we'll see how the markets react to the Fed tomorrow and perhaps try the SPY July calls.
Monday, June 15, 2015
A downside start to expiration week as the Dow fell 107 points on light volume. The advance/declines were about 2 to 1 negative. The summation index continues lower. We sold off early pretty hard and made back half of it during the session. I would still like to try the SPY June calls but early today was probably the ideal time to buy them. I do think that the summation index will turn around this week. But the technical set-up to trade here is not ideal as things could still go either way. GE was off 18 cents on average volume. Getting to short term oversold but not there yet. Perhaps the GE July calls will be the next trade. Gold found some interest as the futures rose $6. The US dollar was slightly higher. The XAU and GDX had slight gains on summer average volume. I would have expected more interest in both gold and the US dollar with the questions coming out of Greece. Perhaps the market knows more than we do. Mentally I'm feeling OK. Greece is stealing the spotlight once again and the next meeting to resolve that is on Thursday. I'm guessing a deal will get done and the markets will rally. We have the Fed on Wednesday to deal with as well. So it should be a somewhat volatile trading week, with expiration thrown in there too. I could just sit on the sidelines myself but you don't make any money like that. I might try the SPY June calls if we head lower to test the recent lows tomorrow. But it would be very risky. The best trades are when things line up properly and that isn't really the case at this time. I do want some of the GE July calls though at some point soon. If there is a deal for Greece on Thursday, there won't be any reason to buy gold. If the Fed is hawkish with its statement on Wednesday, it's another reason not to buy gold. Trades need to be technically based and right now it's a news driven environment. That said, I still might try something tomorrow. I'll go over everything again tonight and then decide. But as I said earlier, this morning may have been the best time to get some SPY June calls. So we'll see. We'll keep an eye on the overnight developments and go from there.
Friday, June 12, 2015
Back to the downside to close out the week as the Dow fell 140 points on very light volume. The advance/declines were about 2 to 1 negative. It appears that the market is still trying to make up its mind here. The short term technical are mid-range. I still may try the SPY June calls again but the risk would be pretty high and the signal, if it comes, wouldn't be as strong as the last one. Greece is back in the news and so we may just have to wait for that to be resolved before we get any real direction. GE was off 1/8, very light volume there as well. Gold was off just a bit today as was the US dollar. We are not seeing a flight to safety yet with the recent, back in the news again Greece situation. The XAU and GDX had slight fractional losses with no volume. The lack of interest here is obvious. The ABX October calls are still on my radar. Mentally I'm feeling OK. Not exactly sure where we go from here but I'm leaning towards a bullish conclusion to all the sideways movement. The summation index is heading lower but it is in a zone where unless we get a complete collapse, it should turn around. I do not think that the market will fall apart here. I could be wrong. We could not improve on the huge up day Wednesday and that could be a problem. Technically things could go either way. Guessing is not a winning strategy. Maybe if the 50 day RSI on the S&P 500 gets oversold early next week, I'll try the SPY June calls again. But things were lined up better for the last trade. It will be options expiration week so perhaps the usual positive bias will show up. GE has been moving sideways since the breakout in April. The Bollinger bands have contracted which implies a pretty good move is on the way. As usual, the direction is the question. I think GE will be moving higher but it isn't oversold at the moment. The gold shares remain oversold without any bounce and the volume says nobody is interested. With summer fast approaching, the lack of participants in all the markets is something to consider. Light volume can skew things on way or the other but not really mean anything. Probably treading lightly is the best course of action unless there is a solid technical set up. There will be plenty to think about over the weekend and we'll have to keep an eye out for any headlines. News event markets are not easy to trade but that is the nature of the game. We've got the Fed to deal with next week as well. But it's Friday afternoon now and time for a break.
Thursday, June 11, 2015
We did get some follow through today as the Dow rose 39 points on light volume. The advance/declines were positive. The summation index is still moving down. Retail sales were a touch better than expected. We rallied for the first half hour and drifted lower for the rest of the session. The short term technical are now mid-range for the S&P 500. I still think we are heading higher. I did sell the SPY June calls today for a bit over 100% profit. I could have had a better exit as well but at least I stuck to the short term trade time frame. I may even try these again before expiration. GE was off 1/8 and the volume was light. I'm still considering the July calls here. Gold was off around $5 on the futures as the US dollar rose off of the retail sales report. The XAU lost 1 1/3, while GDX shed about 1/4. Volume remains light here as there isn't any interest in the gold shares. The gold shares are relatively weaker here and that is not a bullish sign. Mentally I'm feeling OK. The SPY June trade went OK. The entry and exit good have been better. However that trade is over and doesn't matter now. If the technicals line up properly in the next 6 days, I may try this trade again. I do think that the summation index is going to turn around here and start to move higher. Perhaps the July calls would be a better choice but they are expensive. I'll have to look things over tonight. Inflation data tomorrow but next week we get the Fed and the markets should move on that. Gold is not doing much and remains uninteresting. But I am probably going to try the October ABX calls if gold gets to $1150 or so. Whether it can hold that level will determine the fate of that trade. We'll watch what goes on overnight and close out the week tomorrow.
Wednesday, June 10, 2015
The expected bounce arrived as the Dow rose 236 points on average volume. The advance/declines were shy of 3 to 1 positive. The summation index is still heading lower. I'm not sure if today was simply a one day wonder or the start of something that leads to new all time highs. I'd like to think that it's the latter. My SPY June calls are doing good despite the poor timing on the entry. I perhaps should of just sold them today though. We are right at a short term down trend line that began about 3 weeks ago for the S&P 500. We'll move off of the retail sales data tomorrow. GE was up almost 1/3 on average volume. It appears that I've missed this trade for the July calls. However the market goes where it wants and things could turn around tomorrow. Gold was up almost $10 on the futures as the US dollar had a weak session. The XAU was up 7/8 and GDX rose an 1/8 on light volume. The gold shares didn't really follow gold higher and that isn't bullish. NEM has turned into an under performer now. I'm going to try and remain patient on the gold shares but do want the October calls here at some point. Mentally I'm feeling OK. So we got the bounce and now what? It was technically expected and it showed up. But where do we go from here? I'm hoping for some upside follow through tomorrow but anything can happen. I'm considering holding on to this trade longer now but that may not be the proper strategy as well. As usual, the game is never easy. The major stock index daily candlestick charts look to have bullish set ups on them after todays price action. The short term indicators also have room to run higher. So there will be a lot to think about tonight. I don't think that recent upside in gold the past 3 days is the start of anything substantial. I could be wrong. The short term technical indicators have turned up here as well. The ABX October calls are still on my radar. We'll see if the foreign markets can follow the Dow higher and then await the market reaction to the retail sales numbers.
Tuesday, June 09, 2015
We limped around for much of the session as the Dow fell 2 points on light volume. The advance/declines were almost 2 to 1 negative. The summation index continues lower. The internals are very weak. That said, we are short term oversold and I do believe a decent bounce is coming tomorrow or Thursday. I did get the SPY June calls this morning but my timing was not good. I could have gotten a better price if I was quicker and ended up chasing it. They are at break even now. This is probably a trade that needs to be sold by the close on Thursday. We'll see. GE was up a few cents on what passes for average volume these days. I still like the July calls here. Gold was up a few bucks on the futures as the US dollar was slightly off. The XAU and GDX had slight fractional losses on light volume. NEM got whacked on a deal to buy another miner by issuing more shares. Perhaps the out performance there is coming to a halt. I still am considering the ABX October calls. Mentally I'm feeling OK. The price action in the SPY calls today was interesting to say the least. But at least there is plenty of liquidity there. I am pretty sure that buying the calls here is the right trade. Otherwise things will unravel and I don't see that happening tomorrow. Maybe the retail sales report on Thursday can get things moving to the upside. I think that will be the case if tomorrow is another day like today. My execution on the entry today wasn't good. I knew what I had to do and juggled around with the price too much. The SPY is a fast trading vehicle. I'm still fairly confident that this trade will work out. Gold is still above $1150 and the volume has been light to start off the week. I'm trying to remain patient there. We'll watch the foreign markets overnight and take it from there.
Monday, June 08, 2015
To the downside to begin the week as the Dow fell 82 points on light volume. The advance/declines were 2 to 1 negative. We closed near the lows for the session and that is bearish. The summation index continues lower. The short term technical indicators are oversold for the major stock indices. That said, I do believe that on weakness tomorrow SPY June calls can be bought. That will be my next trade. Unless the market is about to completely unravel, we should see a bounce either tomorrow or on Wednesday. GE was off a nickel and the volume was light again. I'm still considering the July calls here. Gold was up $5 on the futures as the US dollar fell by over a point. Considering the drop in the dollar, it wasn't much of a gold rally. The XAU and GDX had fractional gains but volume did pick up a bit to the upside. The gold shares are short term oversold here. I am still leaning towards the ABX October calls if we get medium term oversold. Mentally I'm feeling OK. My work says that some upside is coming. I don't know how long it will last but there should be something by Wednesday. Weakness can be bought tomorrow. The overall market was weaker than the Dow today and we haven't seen that lately. I will be looking to get some SPY June calls in the early hours of trading. Of course I could be wrong and if I am we'll see quite a decline due to the technical nature of what is unfolding. But I do not think that will occur. Gold needs to hold the $1150 level and for silver it's $15.50 or we're heading lower. Perhaps if we get to these levels in the coming days, I'll try the ABX October calls. Too soon to tell. Hopefully my timing on the SPY trade tomorrow will be correct. We'll see if the overseas markets follow the US lower overnight.
Friday, June 05, 2015
Reaction to todays employment report? Not much. The Dow fell 56 points on light volume. The advance/declines were slightly negative. We were down, then up and spent most of the day in a sideways malaise. That is where we are at. Sideways forever or so it seems. The summation index is still heading down. The TRAN had a positive session and the small stocks along with the overall market were stronger than the Dow. I'm leaning towards perhaps getting some SPY June calls at the beginning of next week. GE was up a few cents and the volume was pretty light. Getting short term oversold but not completely there yet. Gold fell $7 on the futures as the US dollar was higher today. Gold did come back a few bucks in the aftermarket. The XAU fell 7/8 and GDX lost 1/4. Volume was very light. There is no compelling reason to own gold here. $1150 is the next downside target and it will need to hold on there. I'm still looking at the October ABX calls. Mentally I'm feeling OK. It is rare when we don't see some volatility one way or the other on the jobs report. Perhaps the market has its mind on something else. Employment expanded more than expected. Maybe the recent rise in interest rates is putting a lid on the stock market. That money has to go somewhere though. Technically the major big cap indexes are short term oversold. Whatever is going on underneath the surface will eventually come out. There will be a lot to consider over the weekend. The precious metals did come off of their lows but the lack of volume was glaring. There is no interest here. Sometimes the time to buy is when nobody else wants it. The fundamentals for gold at this time are negative though. But I do want to have some kind of bullish position before the seasonally strong August/September time period. It may be too early. Plenty to ponder over the next 2 days. I really think that the market is setting up for some type of rally soon. I could be wrong but if things pan out on Monday or Tuesday, I'm probably going to attempt the SPY June calls. We'll see what the charts say over the weekend. For now it's Friday afternoon and time for a break.
Thursday, June 04, 2015
Lower today ahead of the jobs report as the Dow fell 170 points on still light volume. The advance/declines were 3 to 1 negative. The summation index is still heading lower. The selling in the bond market seems to be carrying over to stocks. I think tomorrows price action will go a long way as to where we are heading for the next few weeks. Short term oversold on the major big cap indices. GE was off 1/4 on average volume. The Bollinger bands on the daily chart here are converging. This suggests a big move is coming up. In which direction is the question. Gold fell today, about $10 on the futures. The US dollar finished little changed but came off of its lows. Commodities in general were weak today. The XAU and GDX had slight fractional losses on light volume. Oversold and staying there for the gold shares. Mentally I'm feeling OK. Still over 2 weeks left in the June option cycle. It looks like things are rolling over here for stocks. If we get a strong employment report, stocks will probably head lower. If that is the case a bounce trade in the SPY next week is possible. Lower prices could give me a chance at getting the GE calls. Gold closed below $1180 today and the next support comes in at $1150. If that doesn't hold up things could really get ugly there. I'm still looking at the October gold share calls though. Timing is everything. We'll watch overnight to see if the foreign markets follow the US lower. Then all eyes will be on the market reaction to the jobs report.
Wednesday, June 03, 2015
Once again the market is heading nowhere fast as the Dow gained 64 points on light volume. The advance/declines were barely positive. The Dow finished well off of the highs for the session. The summation index is still moving lower. The TRAN had a strong session and that's a positive. But I still don't have a good feel or signal on what to do here. I'm leaning towards the SPY call side but the volume has been so light lately that I don't have a good idea. I'll probably just remain on the sidelines. GE gained 20 cents and the volume is still light. It looks like maybe that GE will not get into what I consider the buy zone for the July calls. I'll wait and see. Gold was off almost $10 on the futures despite another drop in the US dollar. The XAU shed 1 1/4, while GDX lost 1/3. Volume remains lackluster. I'm guessing that things will pick up here with the release of the jobs numbers. Which way is the question. Mentally I'm feeling OK. Tomorrow should be another wishy-washy session ahead of Fridays release. I'm most likely going to remain cautious. Sometimes you have to be patient and wait for good set ups. You do not want to get into a habit of guessing. I would like to put on a trade but there isn't really anything that I'm clear on right now. The precious metals are getting short term oversold but I'm going to wait. Ditto for the gold shares. I may change my mind tomorrow but for now indecision rules the day. We'll watch what happens in the foreign markets overnight and take it from there.
Tuesday, June 02, 2015
Back and forth again today as the Dow fell 28 points on light volume. The advance/declines were slightly positive again. So we continue to go nowhere as the market tries to resolve which way it wants to go. This has been going on for weeks on end. The only sustained trend is sideways. There is a short term down trend line in effect for the big cap stock averages. What happens there probably will tell the story. Waiting on Fridays employment report. GE was up a nickel and the volume was light. Waiting for oversold here. Gold was up $5 on the futures which wasn't that much considering the US dollar got clobbered. The XAU rose 1 1/4, while GDX gained about 1/3. Volume was average for lately. Not sure what is happening here with respect to the US dollar. However golds lack of better upside isn't bullish. Mentally I'm feeling OK. I suppose all we can do is wait while the market decides which way it wants to go. The short term techncials are getting oversold here though for the major stock indices. Perhaps the SPY June calls ahead of the employment report will be the proper play. But the summation index is still moving lower. I may just have to remain on the sidelines. I've got a couple of days to decide. The gold shares can wait for now in my opinion. Short term oversold there as well. However the medium term picture isn't as clear. The trading is never easy. We'll keep an eye on the overnight developments and see what tomorrow brings.
Monday, June 01, 2015
The Dow gained 29 points to start the month of June. The advance/declines were slightly positive and the volume was light. We bounced around and gave up half of the days gains in the final hour. The summation index is still heading lower but the TRAN had a good day. It appears that the market is still trying to make up its mind. GE was basically unchanged on average volume. The July calls here are still on my radar. Gold was off a buck on the futures which wasn't bad because the US dollar was higher once again today. The XAU and GDX had slight fractional losses on light volume. Short term oversold for the gold shares. Mentally I'm feeling OK. I looked all weekend for something to trade but there aren't any clear signals at the moment. The summation index is still pointing down and I'm going to follow that cue. I'm still in a cautious mode for now. If we head lower into the employment report, I may be tempted to try the June SPY calls on Thursday. But things will have to line up for that trade. I also still want to try the gold shares going out to October. But patience is probably a good thing for that idea. I also had an idea to trade AAL after reading an article in Barrons a week ago. However I do not follow the airline stocks per se and this issue has already moved higher. The June calls there were the proper choice. We'll keep an eye on the overseas markets tonight and go from there.