Thursday, June 02, 2016
Another one day reversal to the upside as the Dow opened lower and closed higher. It gained 48 points on light volume. The advance/declines were almost 2 to 1 positive. The summation index continues to the upside. We've gotten above 2100 on the S&P but the volume has been lacking once again. The advance/decline line continues to make new highs though. Overbought, staying that way and I don't see any changes at the moment. The trend is up until further notice. GE was off a few cents and the volume was very light. Gold was flat on the futures and the US dollar was slightly higher. The XAU and GDX had slight fractional gains on very light volume. Mentally I'm doing OK but did have another visit to the dentist today. We'll get the employment numbers tomorrow and as usual the market reaction will be the key. I don't know what to expect one way or the other but I do think things will have a positive resolution. The small stocks continue to gain ground and that's a plus. It would help the bullish cause if we could get the TRAN above its 50 day moving average but that hasn't happened yet. My idea here is to let things make their way up to around the 2125 level on the S&P and take a look at the SPY June puts there. Subject to revision as we move along. With the good breadth and upward trending summation index, there is no reason to be overly bearish. Sellers have seemed to have left the arena for now. NIKK took a hit last night but the other foreign markets were little changed and mixed. The OPEC meeting was a non market event. We'll wait to see what the employment report has to say and close out the week tomorrow.