Monday, October 19, 2015
We begin the week with a 14 point gain on the Dow. The advance/declines were slightly negative and the volume was light. The small stocks had good relative strength and that's a positive. The summation index continues higher. Still short term overbought for the major stock indices. GE was flat on the session but volume remains extremely heavy. Due for some kind of pause here I would think. If we get back to $28, I'll look at the calls again. Gold was off a few bucks today as the US dollar was higher. The XAU was off almost 2 1/2, while GDX fell 2/3. Volume was heavy. It appears the 2 1/2 week gold share rally has run its course. No trades here for now. Mentally I'm feeling OK. Not much economic data this week, mostly housing numbers. Earnings should be the driver of prices for the time being. I'm still looking for the S&P 500 to reach the 2050 level at least before we stall or pull back. The short term overbought nature of the market here should mean that the upside is limited in the near term. The extra week on the November options makes the premiums more expensive. That is another reason to watch and wait for now. We'll keep an eye on the overnight action and go from there.