Monday, August 31, 2015
We start the week and end the month on the downside as the Dow fell 115 points on heavy volume. The advance/declines were negative. Most likely digesting the recent gains. Plenty of market moving data to come this week. I think that the key will be to have the patience to wait for a decent signal. Plenty of time in the September option cycle. The premiums are still high with the recent volatility. I will wait for a signal on a short term technical basis. GE was off 1/3 and the volume remains pretty good. The November calls are what I'm looking at here. Gold was little changed today and the US dollar was lower. We may see some movement in gold with the Feds beige book release on Wednesday. The gold shares were lower, with the XAU and GDX showing slight fractional losses. My ABX October calls remain mired in the red. Mentally I'm feeling OK. I looked at things over the weekend and decided that medium term you could probably make a case for either direction. I do think with the summation index turning around that the surprises will be to the upside and not another collapse scenario. But I could be wrong. If the summation index moves higher and stalls in the 500 level zone, then the rapid downside could return. I don't think that will be the case but the market moves where it wants. For now I'm advising patience and waiting for a technical set up either way. Gold remains unloved, uninteresting and off the positive radar. Seven weeks for my ABX October calls and that just won't be enough at this point. I'm hoping for another rally but hope is not a viable trading strategy. I'll be looking to take the loss if we get a bump to the upside soon. We'll watch the foreign markets tonight and see if the Shanghai can continue to hang on here.