Tuesday, August 16, 2016
We got some selling today as the Dow fell 84 points on light volume. The advance/declines were 2 to 1 negative. The summation index tried to head back up but it has turned around again. We closed on the low of the day and that's bearish. No positive option expiration bias yet. The short term technical indicators for the S&P 500 have rolled over. Could this be the beginning of a meaningful decline? Perhaps, but I doubt it. There aren't any negative divergences that I can see on the daily charts yet. The sentiment has gotten more bullish here lately though. I'm going to keep an eye on the SPY September puts. GE was off a nickel and the volume was light. We finally closed below the 50 day moving average here. Gold was up a few bucks and the US dollar had a pretty good drop. The XAU and GDX both had slight fractional losses on very light volume despite the drop in the dollar. That is not bullish price action for the gold shares. I'm not sure what to make of it. Mentally I'm feeling OK. We got a little bump in volatility today. Could the summer doldrums be coming to an end? We are entering a period of seasonal weakness for stocks. However the volume has been so anemic that it is hard to exactly know what is going on. Major players are still on vacation. One day doesn't make a trend though and we'll have to see how the market reacts to the Fed minutes tomorrow. There was general weakness around the globe last night. Does the market know something that we don't?