Monday, June 06, 2016
Higher to start the week as the Dow gained 113 points on light volume. The advance/declines were better than 2 to 1 higher. The summation index is heading up. There is nothing in the way of hitting new all time highs soon. The question will be what to do when we get there. It is possible that the market will simply keep moving higher because there will be no overhead resistance. The only problem here has been the volume, as it remains weak. You cannot argue with price but there is no power behind it. I do not think that simply a drift higher will be enough. GE was up over 1/8 on light volume. Gold rose almost $5 on the futures as the US dollar was a touch lower. The XAU added about 7/8 and GDX was up 1/8 on average volume. Not a lot of follow through to Fridays stellar gains for the gold shares. Mentally I'm feeling OK. It doesn't appear that we will get a chance for the SPY June calls in the next 9 days. Perhaps if we make it past 2125 on the S&P, I'll start looking at the SPY puts for a short term trade. We remain overbought on the short term technical indicators for the major stock indices. Not a lot of economic data due out this week. So it probably is a good idea to remain on the sidelines for now. Of course things could always change in a hurry. Foreign markets were generally slightly higher overnight with the exception of NIKK. We'll see what tomorrow brings.