Monday, July 13, 2015
More upside to begin expiration week as the Dow climbed 217 points on light volume. The advance/declines were almost 3 to 1 positive. The summation index is now moving higher. I believe that we are back in the buy weakness mode. The decline has run its course in my opinion. The volume to the upside here has been light, so a return to test the recent lows could be in the cards. However prices are moving higher and we cannot deny that. Too late for the SPY July calls though. I could be wrong. GE was up 20 cents on light volume. My GE July calls are still losers but not as much as they were. Waiting on the earnings due Friday here. That is what this trade has turned into. Gold was off slightly on the futures despite the big gain in the US dollar. The XAU and GDX had slight fractional gains on light volume. The gold shares did turn around today, after selling off early. I'm still looking at the October gold share calls. Today was potentially the day for the ABX calls as ABX ran down to $9.75. I might try and purchase the October calls here tomorrow or Wednesday. Mentally I'm feeling OK. The market is still in the headline risk mode but I feel like the worst is behind us. Greece still has another deadline for it's bailout on Wednesday. This is an ongoing soap opera. I think that only a Greek exit from the euro would stir things up again at this point. Unless the Chinese stock market starts to crash again. We've got Yellen in front of Congress in a couple days but I do not expect any surprises there. Earnings are on tap from the major banks in the coming week. They could get things moving one way or the other. I was cautious as of last week but with the turnaround in the summation index and the major average technical indicators moving up now, the all clear signal has been given. It's possible that the gold shares simply followed the market higher today. Nothing has changed fundamentally there. Still oversold on a short and medium term basis. The options are certainly cheap enough but if continue to simply decline, that won't matter. I'll consider this idea again overnight. We'll watch the overnight action and go from there.