Tuesday, December 20, 2016
The march to Dow 20000 continues as it rose 91 points today on light volume. The advance/declines were almost 2 to 1 positive. The summation index is tending higher. Just 25 points away from that magic number and we should make it tomorrow or at least before the end of the week. Still overbought any way you look at it but it doesn't matter. What will happen when we get there? Probably just more buying as nobody is doing any selling with the promise of lower tax rates next year. The lighter volume as we go higher here is a concern but it is holiday time. It appears that any option trade to the upside will not happen at this rate. GE was up 1/3 and the volume remains good. Overbought here as well. Gold was flat on the futures session, with the US dollar up just a bit. The XAU and GDX had slight fractional moves up on light volume. Certainly no interest in buying gold or the gold shares here. Mentally I'm feeling OK. It looks like we're in the holiday period run up for stocks. No overhead resistance and the technical indicators remain overbought. I suppose we'll just have to see how high this thing can go. Usually higher than you think. No real pullback opportunities to get the SPY January calls. The high option premiums are also a factor in not just buying something to get in there. I'm keeping an eye on the daily RSI indicators for the RUT and S&P 500. If we do get higher highs in the indexes with lower RSI readings, that would be a negative divergence that I'm looking for. Hasn't happened yet and this is really a bullish time of year. I'd rather see some selling to get long. Asia was mixed and Europe higher in the overnight session. We'll see if they break out the Dow 20000 hats out on Wall street tomorrow.