Wednesday, February 10, 2016
A mixed bag today as the market tried to rally but failed. The Dow fell 99 points on lighter volume. The advance/declines were slightly positive. The small stocks managed a slight gain and the overall market was stronger than the Dow. The summation index is still heading lower. I'm not sure what to make of the situation. For some reason I'd still like to try the SPY February calls if we see weakness tomorrow. But it is a tricky situation. Getting oversold on some of the short term technical indicators. However today was a one day reversal to the downside for the Dow. I'll ponder the trade overnight. GE was flat on the session and came off of its highs. Volume was light. Gold was off a couple bucks on the futures and the US dollar was a bit lower as well. The XAU gained a point, while GDX rose 1/3. Volume was lighter than lately. Gold and the gold shares are due for a rest in my opinion. Mentally I'm feeling OK. Make no mistake that this is a very difficult market environment to trade. With only six days left in the February option cycle, the risk is high. The timing will really have to be right on to attempt something here. If we get some weakness tomorrow, I will probably try the SPY calls. I do believe that we will rally on Friday according to some of my technical indicators. But I could be wrong. I again tried to get some of the February SPY calls today but canceled the order. Japan was weak again last night but the European markets were generally positive. Oil is dropping again but isn't the headline that it was. I still think that debt is the problem but that is just my view and not a fact. The equity markets are certainly acting in a strange fashion right now. Perhaps it would be best to simply stay on the sidelines. That will be something to think about overnight as well.