Friday, November 18, 2016
Friday of expiration week finished lower as the Dow fell 34 points on average volume. The advance/declines were slightly negative. The summation index is heading higher. Lackluster trading to be sure as perhaps the holiday mode has begun early. I'd still look to get long if we continue lower in the near term. A pause to relieve the overbought condition would be healthy when it comes to moving forward later in the December option cycle. Wishful thinking on my part and it hasn't happened yet. GE was off 1/8 and the volume was light. Gold fell almost ten bucks on the futures as the US dollar continues its climb. The XAU and GDX had fractional losses on lighter volume. No love for gold in this environment. Mentally I'm feeling a bit tired. It's been quite a run since the US election and I don't think anybody saw a rally of this magnitude occurring in such a short time. The market really could use a breather. The Thanksgiving holiday week is coming up and I expect slow trading to follow. It will probably be a time to get ready for the end of the month and the beginning of December. I'll be keeping an eye out for the SPY December calls as I don't foresee any obstacles at the moment to the levitation in stocks. If we can get the short term technical indicators back to mid-range, that would be enough in my opinion to try the calls again. We'll see. Asia was mixed and Europe lower last night. I'll be checking the charts over the weekend but I can already tell you that they remain overbought on the major stock indices. Patience is most likely the trait that will be required at the moment. For now it's Friday afternoon and time for a break.