Thursday, April 14, 2016
It was a day to consolidate the recent gains as the Dow rose 18 points on light volume. The advance/declines were negative. The summation index is still moving up. No volatility today as we traded in a narrow range for the whole session. Price on the S&P 500 is right up against the top of the Bollinger band. Upside could be limited from here for a few days. The short term technical indicators on the major averages are back to overbought. One thing lacking here is volume and that could be a problem down the road if it doesn't pick up. GE barely moved and the volume was light. Gold dropped $20 on the futures as the US dollar was up just a bit. Gold was overbought and the dollar has risen the past 2 days. The XAU shed 2 1/2, while GDX lost 2/3. Volume was average. Mentally I'm feeling a bit tired. Losing trades don't help the cause. We've got option expiration tomorrow and then we roll into a five week May option cycle. So there is no hurry to put on the next trade. Not to mention that we are now in earnings season and markets get moved around by the numbers. We won't get into the validity of the earnings. We are only interested in what the price action is and how we can profit from it. We've got resistance at 2100 and then 2125 for the S&P. If we can get above 2125 there is no overhead resistance. You can buy calls when we get through that number. I do not know when that will happen but be ready when it does. April is generally a positive month so maybe we can get there in the next couple of weeks. That's a guess and we would really have to see volume pick up to have a chance at a break out. Foreign markets were generally higher overnight. We'll see how the expiration goes tomorrow.