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Thursday, July 20, 2017

A bit lower today as the Dow fell 29 points on light volume.  The advance/declines were barely positive.  The summation index is moving up.  Kind of just a sideways summer session.  Overbought both short and medium term now for the S&P.  The TRAN has already rolled over.  I can't see us going much higher in the near term but my ideas have been quite wrong lately.  We'll see how the expiration goes tomorrow.  GE was off 1/4 and the volume was heavy.  This stock just cannot get anything going to the upside.  The daily candlestick chart is bearish.  Gold was up just a bit on the futures as the US dollar continues its decline.  The XAU and GDX had slight fractional gains on light volume.  I canceled my open order for the ABX longer term calls for now.  I'll let the earnings report come out next week and then figure out if I still want to try this trade.  The gold shares have rallied for a couple of weeks but the volume has been light.  Mentally I'm feeling OK.  Record highs day after day for most of the major stock indices large and small.  I still do not trust this rally because the volume has been light all the way up.  It may just be because of the summer season but I cannot go against that principal.  I still think that things will not end well here and we are on the 5th and final wave up that started with the end of the last recession.  Earnings season is upon us and we'll have to see how that goes.  The rise this week could simply be expiration related, combined with squeezing what is left of the shorts.  Asia was higher and Europe mostly lower last night.  We'll see how we close out the week tomorrow.   
The rally continued yesterday as the Dow gained 66 points on the usual light volume.  The advance/declines were about 3 to 1 positive.  The summation index is now heading higher at a better rate.  The overall market was much stronger than the Dow.  There is no overhead resistance but I would expect a move back to the breakout point.  However my ideas on the stock market have been wrong lately.  I also still do not trust this light volume move up but you can't argue with price.  Gold was little changed as was the US dollar.  I got tied up yesterday and never made it back to a computer to update the blog.  Things will be back to normal for the blog, or at least should be, today.

Tuesday, July 18, 2017

Lower for the Dow today as the most watched index shed 55 points on light volume.  The advance/declines were slightly negative.  The overall market was stronger than the Dow with both the S&P 500 and the NASDAQ higher.  The summation index is still moving up.  We got another signal yesterday from the McClellan oscillator that portends a big move that would now be due tomorrow.  We'll see if that signal works again.  Not much else for me to do here.  The market is overbought and staying there.  That is the way it goes in up trends.  I'm still not sold on this light volume rise.  GE was up a few cents and the volume was light.  Gold gained $8 on the futures as the US dollar down trend continues.  The XAU and GDX had slight fractional gains on light volume.  Gold has been acting better than the gold shares in this rise and that generally isn't sustainable for a long term trend.  You'd like to see the opposite.  Mentally I'm feeling OK.  It looks like we're getting the positive expiration bias for the stock market this week.  No news really and we tried to sell off early today but to no avail.  I'm on the sidelines for the foreseeable future due to lack of confidence combined with an upcoming vacation.  I'll be canceling the open order for the longer term gold share calls this week due to the earnings coming out next Wednesday.  Not exactly the summer doldrums here but the volume is slow and the price movement isn't extreme.  We'll see what happens tomorrow.  Asia was mixed and Europe lower overnight.  The Dow did follow the DAX but not with the same degree.  I'll be keeping an eye on the news tonight.    

Monday, July 17, 2017

A quiet summer Monday of trading as the Dow fell 8 points on very light volume.  The advance/declines were positive.  The summation index is still moving higher.  Short term overbought now for all the major averages.  But that doesn't mean that we can't stay that way.  I do think some type of decline is imminent though.  However after last weeks debacle, I'll be remaining on the sidelines.  4 days to go in the July option cycle and my confidence is shot anyway.  With a trip planned during the August cycle. it appears that I won't be trading the SPY options anytime soon.  It's a light week on the economic calendar.  GE was up a few cents and the volume was light.  Gold was up $5 on the futures as the US dollar was little changed.  The XAU rose 1 1/4, while GDX had a fractional gain.  Volume was very light.  I've still got the longer term open order for the ABX calls out there but will probably cancel it ahead of the earnings next week on the 26th.  No need for a surprise there and if ABX drops, then I'll consider it again.  Mentally I'm feeling OK.  The VIX is below 10 and oversold any way you look at it.  This won't last forever either.  I do expect some kind of drop or consolidation this week.  At the rate things are going here, it looks like we could head higher after a brief pause.  But I really don't think we are going to see a strong leg up.  The volume is just not there and eventually this too will fail.  The timing, as usual, is the question.  Now it may seem as though I'm leaning back and forth on what will happen here.  But we will be heading lower in my opinion because a light volume rally can never be trusted and the breakout in the S&P here is weak in my opinion.  Europe and Asia were mixed overnight.  We'll follow the overnight developments and take it from there. 

Friday, July 14, 2017

New all time highs once again as the Dow gained 84 points on very light volume.  The advance/declines were over 2 to 1 positive.  The summation index continues higher.  Overbought and staying that way for now.  We have broken out to new all time highs on the S&P 500 as well.  But the volume is so light here that I am pretty sure that this rally will not end well.  The shorts got squeezed today and that included me.  I got clobbered on my SPY July put trades.  I simply dumped them today because this was a poorly timed idea.  I thought that I was doing the right thing but was simply wrong in my take of the market.  I was getting short as the sideways consolidation was ending.  I'm not sure if it was because I wanted to get a trade in for the July cycle or perhaps to put something on since I hadn't traded in a while.  Regardless, my reading of the indicators and the markets was wrong.  It was a 75% loss on the first trade and a 60% loss on the second.  I committed the cardinal sin of chasing a losing trade.  My thinking this past week was poor to say the least.  But you've got to keep moving on.  GE lost a penny on very light volume.  Gold was up over $10 on the futures.  The US dollar was lower on weaker than expected economic data.  The XAU added 1 1/3, while GDX rose 1/3.  Volume is still light here.  I still have my open order for the longer term ABX calls out there for now.  Mentally I'm feeling frustrated after my losing trading attempts this week.  There is no way in my mind that I think we are on the verge of another leg up here for the S&P.  Even though it is summer, the volume is so light on this up move that it just cannot be trusted in my view.  We're short term overbought but can stay that way as option expiration week is upon us.  So what's my next move?  Do I dare try the SPY July puts again next week?  Probably not.  I'm most likely going to head to the sidelines to lick my wounds.  I'm also planning a vacation for a change during the August option cycle, so my attention then won't be what is necessary to trade.  I'm pretty disappointed in my trading behavior this week and that is not the mental state of mind that is helpful for success.  The set up now looks like the market is about to drop but I am pretty sure that I'll be sitting things out for now.  The VIX is almost at its lowest point for the year and that will not last.  I'll go over all the charts again this weekend but I would not be surprised to see some kind of drop next week.  It's Friday afternoon in the summer and time for a break.

Thursday, July 13, 2017

A drift higher today as the Dow rose 20 points on light volume.  The advance/declines were slightly positive.  The summation index is trending higher.  The overall market was stronger than the Dow.  The volume is so light here at all time highs for the Dow that I have to believe that the market will head lower in the near future.  And sooner rather than later hopefully for my SPY July puts.  I did think that today was the ideal time to buy and I purchased some other SPY July puts at a higher strike price.  This is a risky venture to say the least as the market could simply stay overbought and drift higher.  But without something to provide a push higher, I have to think that a pullback is coming soon.  We'll see.  GE was up almost 1/4 but the volume was lighter.  Gold was slightly lower on the futures as the US dollar was little changed.  The XAU fell 1 1/8, while GDX dropped 1/4.  Volume was light.  Mentally I'm feeling OK.  I'm breaking one of the rules here as I am chasing a losing position with more capital.  I'm now holding the SPY July puts at two different strike prices.  Both are showing losses with the lower strike price having the bigger loss.  I'm not sure if I want to hold this over the weekend or not.  I'll have to let tomorrows price action determine that most likely.  We're short term overbought but we could get more overbought.  With 6 days to go in the July option cycle there is time for this trade to work.  However as time goes by the premiums get smaller and that doesn't help the situation.  The trading is never easy.  Europe and Asia were generally higher overnight.  We'll close out the week tomorrow. 

Wednesday, July 12, 2017

We got the big move implied a couple days ago by the McClellan oscillator as the Dow rose 123 points on light volume.  The advance/declines were 3 to 1 positive.  This should turn the summation index back up.  Yellen spoke and the market liked what it heard.  The Dow hit a new all time intra-day high.  My open order for the SPY July puts was filled in the morning and is showing a small loss.  This trade doesn't appear to be working, as tomorrow might actually have been the time to place it.  I may sell it for a small loss tomorrow morning and then move to a higher strike price as the day moves on.  It depends on how we open and the market action early on.  The short term down trend line has been broken to the upside and the short term indicators have moved back up.  So perhaps the puts here are not even the right idea.  I don't trust light volume rallies though.  GE was up 20 cents and the volume was heavy.  Perhaps The low for GE has finally been put in.  Gold was up almost five bucks on the futures.  The US dollar bounced around and finished the day little changed.  The XAU and GDX had slight fractional moves higher.  Volume remains light here.  Mentally I'm feeling OK.  Finally back in a trade but it isn't quite going as I'd like it.  I'm either a little early or this idea is completely wrong.  The overall market was stronger than the Dow and the small stocks acted well.  Getting short term overbought for the small stocks but we still could see some more upside despite being overbought.  If we see a pick up in volume to the upside, then I think we'll be getting a summer rally.  If we stall out here, then the SPY July put trade could work.  There's still 7 days to go in the July option cycle.  But I will try not to fool myself.  My entry today was not what it could have been and there's definitely a chance that we simply move higher from here.  Asia was lower and Europe higher last night.  Some economic data out tomorrow but much more on Friday including retail sales.  We'll keep an eye on the overnight trading action. 

Tuesday, July 11, 2017

Volatility returned today as the market was off more than 100 points during the session but managed to make it back to break even by the end of the day.  The Dow was up a half a point on light volume.  the advance/declines were slightly higher.  The summation index is still moving lower.  My open order for the SPY July puts wasn't close to being filled with todays price action.  I'm leaving it in but things could change in a hurry.  The McClellan oscillator gave a signal yesterday for a big move within the next two trading sessions.  We could have seen it today with the intra-day 100 point move lower.  Or it still may be coming tomorrow.  We will get the Yellen testimony and the Feds beige book.  The market has had plenty of chances to sell off lately but it always seems to find a way back.  GE was up 1/3 and the volume remains good.  Gold was up a couple bucks on the futures after being lower early on.  The US dollar was lower.  The XAU and GDX had slight fractional gains on light volume.  My longer term gold share option order remains in place.  Mentally I'm feeling OK.  We are in an interesting place here as the small stocks broke their 50 day moving averages and have now bounced back to them.  The S&P 500 is balancing on its 50 day moving average as well.  The S&P has also stalled once again at the short term down trend line.  A break above that line should lead to some kind of rally.  The breadth and volume, if it does happen, will tell us what we need to know about where things are going.  But we could simply break down from here as well.  We've been sideways with a downward tilt for over a month now.  Something has to give.  With the summation index still moving down, I'm looking for a meaningful drop.  But we all know that things can turn on a dime in this game.  Asia was higher and Europe lower overnight.  We'll see what tomorrow brings. 

Monday, July 10, 2017

A mixed market to begin the week as the Dow lost 5 points on light volume.  The advance/declines were barely positive.  The summation index is still moving lower.  The overall market was stronger than the Dow and the small stocks led the way.  That's a positive.  The S&P 500 still remains below a short term down trend line though.  I do have an open order to purchase some SPY July puts but it will take a small rally to get filled.  I may be too late as it is possible that today was the day to get short again.  However it is also possible that the consolidation is over and we're going to head to new all time highs again.  I am not in that camp.  GE was off eleven cents and the volume remains above average.  Not sure what is happening here.  Gold was up 3 bucks as the US dollar was little changed.  The XAU rose 2 3/8, while GDX gained 1/3.  Volume was average.  I'm not sure why there was interest in the gold shares today.  My open order for the ABX October calls was almost filled on Friday.  The premiums there have now risen as ABX added 1/2 today.  I'm leaving the order in.  Mentally I'm feeling OK.  Inflation data out this week along with retail sales.  We also will get the fed beige book and testimony from Janet Yellen on Wednesday.  So there is potential for some market movement.  I'm still looking for lower prices in the near term and will take my cues from the summation index.  However, if we get a sharp rally out of nowhere, I'll be canceling my order for the SPY July puts.  Europe and Asia we higher in overnight trade.  We'll keep an eye on tonights developments.

Friday, July 07, 2017

The recent up trend lines held for now as the Dow gained 94 points on light volume.  The advance/declines were a bit better than 2 to 1 positive.  This will slow the drop in the summation index but the summation index isn't really trending one way or the other.  The overall market was stronger than the Dow and that's a plus.  The VIX turned around and is heading back down.  I don't trust light volume rallies and may be looking to purchase some SPY July puts in the beginning of next week.  We are more short term oversold than overbought.  GE was off another 16 cents on good volume.  Not sure what the story is here but we hit a new yearly low.  Gold lost over $10 on the futures as the US dollar was up a bit.  The XAU shed 1 1/2, while GDX lost 1/4.  Volume was average.  I still have the open order in for the longer term ABX calls and will leave it out there.  Could get filled perhaps next week if the decline in gold continues.  I'll take another look over the weekend.  Mentally I'm feeling a bit tired.  The employment report was better than expected and we rallied from the start.  Whether or not it has legs will be determined next week.  We've had quite a bit of selling lately but are still close to new all time highs in some of the major stock indices.  With two weeks to go in the July option cycle, there is still time to put on a trade.  Today was important, because a break here would have led to a lot more selling.  But that could be the case next week if things turn back down and the up trend line is threatened again.  I am kind of leaning towards that scenario but will have to do the work over the weekend to be sure.  I will probably attempt some type of trade next week.  Asia was lower and Europe mixed overnight.  It's Friday afternoon and time for some rest.

Thursday, July 06, 2017

To the downside as the Dow fell 158 points on light volume.  The advance/declines were over 4 to 1 negative.  The summation index is now heading lower which implies lower prices to come.  The overall market was weak as well.  Is it too late for the SPY July puts?  Maybe but we'll have to see how it plays out from here.  We are approaching an up trend line from the beginning of the year for the SPY that comes in at roughly 239.  That could be a spot to try the SPY July calls tomorrow.  However the market has the feel of wanting to drop here.  We are short term oversold for the S&P but not drastically so.  We are also at an up trend line for the NASDAQ.  Tomorrow will be an important session.  We'll either hold on here or start to really drop.  GE was off over a point on heavy volume.  Is this the precursor for tomorrow?  Gold rose a couple bucks on the futures as the US dollar was weaker.  The XAU and GDX had fractional losses on light volume.  Mentally I'm feeling OK.  Obviously the tone of the market has changed here.  Where as before we had no sellers, now we are lacking buyers during the trading day.  We're still pretty close to all time highs for many of the major big cap indices.  The VIX has started to rise here but is not overbought yet.  So here we are.  Potentially on the verge of a breakdown in my opinion.  If we can hold up here there might be a chance for a short term rally.  So we are at an important inflection point for the market.  The employment report will probably trigger some kind of reaction.  I'm not sure if I'll make any trades though.  We'll see.  Europe and Asia were lower overnight but not drastically.  We'll see what happens with the jobs report and the markets reaction to it tomorrow. 

Wednesday, July 05, 2017

Kind of a mixed bag after the holiday as the Dow lost a point on light volume.  The advance/declines were negative.  The overall market was stronger than the Dow for a change, with the NASDAQ up 40 points.  The summation index is still trending sideways and along with the overall market is trying to make up its mind on which way to go.  I'm still leaning towards purchasing some SPY July puts.  However I may wait until Fridays jobs report to decide what to do.  It still appears as though you can make a case for either direction.  GE lost a dime and the volume was light.  Gold was up $3 on the futures and the US dollar finished the day little changed.  The XAU had a fractional gain, while GDX lost a nickel.  Volume was average.  Not a lot of interest in gold despite another launch form North Korea.  Mentally I'm feeling OK.  Over two weeks to go in the July option cycle so there is time to get something done on the trading front.  No clear signal here though and sometimes being patient is the toughest task to do.  I would not expect much tomorrow ahead of Fridays employment report.  The Fed minutes today did not spark any market action.  Perhaps just waiting for Friday makes the most sense at this point.  Europe and Asia were generally higher overnight.  We'll see how it goes tomorrow.  

Monday, July 03, 2017

The Dow rallied on this holiday shortened trading session, gaining 129 points on very light volume.  The advance/declines were over 2 to 1 positive.  The summation index will be higher today but still moving sideways on the overall picture.  We were up over 200 at one point during the day.  The overall market was still much weaker than the Dow here with the NASDAQ firmly in negative territory.  The Dow did set a new intra-day high.  I really think that the index puts are the way to go here as the Dow leadership is bearish in my mind.  It may be too late though as todays price action was actually bearish in my view.  A light volume rally that was sold in the last hour of trading.  GE was up 3/8 on very light volume.  Beginning of the month buying perhaps.  We are oversold all the way around here for GE.  Gold took a hit today as the futures shed over $20.  The US dollar was higher.  The XAU lost 1 3/4, while GDX dropped almost 2/3.  Volume was light.  I do still have an open order for the longer term gold share calls of ABX.  Mentally I'm feeling OK.  The TRAN has now joined the Dow at new all time highs.  It is hard to be bearish with these positive technical conditions.  It is hard to ignore the negative technical divergences in some of the major averages though.  Perhaps we'll see one more blow off to the upside before some real selling kicks in.  Volatility did pick up last week but we have yet to see even a 5% decline in the major averages.  I suppose I'm just really still at a loss on where we are going from here.  But I am leaning towards getting some SPY July puts ahead of the employment report on Friday.  If we continue to go higher in the next couple of trading sessions on light volume, that's what I'm planning to do.  Europe and Asia were generally higher overnight.  We'll enjoy the day off tomorrow and be back at it on Wednesday.

Friday, June 30, 2017

In general a positive day for stocks as the Dow gained 62 points on lighter volume.  The advance/declines were positive.  We were up well over 100 but dropped hard in the last fifteen minutes.  The overall market was weaker than the Dow.  The summation index is moving sideways.  The tone of the market has obviously changed as we are back and forth each session.  I'm going to look everything over this weekend but I'm leaning towards simply buying some SPY July puts.  The small stocks look like they're rolling over here and they are generally the leaders.  The negative weekly RSI divergence remains in place for the S&P 500.  I'd like to see a light volume rise next week going into the employment report but the market rarely cooperates.  GE was flat on the session and the volume was light.  Gold was off four bucks as the US dollar was slightly higher.  The XAU and GDX had slight fractional gains on almost average volume.  Not a lot of interest in gold despite a drop in the US dollar.  Mentally I'm feeling OK.  An interesting week in the stock market as we finally saw some actual selling for a change.  We haven't broken down here yet.  The trend does still remain up for now.  The question is whether this is an actual change in trend that we are about to see or just some end of the June quarter profit taking.  The small stocks are short term oversold and the big caps are trying to get there.  The small stocks are trying to hold their 50 day moving averages while most of the big caps are not even close to theirs.  The TRIN is pretty overbought here, which says to me we need to see some more selling.  But what do I know?  I guess I'll have to see how we do at the beginning of next week and go from there.  Monday will be a holiday session with a day off in the US on Tuesday.  Things should be up to full speed on Wednesday.  I'll do my work over the weekend and try to come up with a valid strategy.  Both Europe and Asia were lower overnight.  It's Friday afternoon and time for a break.

Thursday, June 29, 2017

It was a rock and roll Thursday as the Dow fell 167 points on good volume.  The advance/declines were slightly over 2 to 1 negative.  The summation index is moving back and forth but is basically trending sideways.  The overall market was weaker than the Dow.  We were off more than 250 at one point.  Volatility spiked but came back down into the close.  I'm not sure what is going on here as the market is now moving back and forth each trading day.  I'm guessing today was perhaps the squaring of positions before taking tomorrow off for some traders.  We are at the end of the second quarter and wrapping up the first half of the year.  I'm not sure what happens next.  GE was down a few cents on good volume.  Oversold here on a short and medium term basis.  Gold lost a few bucks on the futures as the US dollar continued its decline.  The lack of progress for gold with the drop in the dollar is a concern for the bulls.  The XAU fell 2 and GDX dropped 1/2 on average volume.  Mentally I'm feeling OK.  There will be a lot to consider over the long weekend but let's get through tomorrow first.  We remain pretty close to new all time highs for some of the major averages.  The tightening of the Bollinger bands still implies some kind of extended price move in the S&P 500.  And the jury is still out on which way that move is.  But I must say with volatility like this, it usually means the end of the move preceding it.  That means we could be witnessing the end of the huge, long bull run that we've been on for years.  It hasn't happened yet though.  The short term indicators for the S&P are still looking mid-range to slightly oversold.  I'll be waiting until after July 4th to make the next trade at this point.  Tomorrow should be a getaway day, with Monday being a light volume pre-holiday affair.  So let's get through Friday and take it from there.  Asia was higher and Europe lower in last nights trading.  We'll close out the week and the month tomorrow.   

Wednesday, June 28, 2017

We had a gap up at the open and never looked back as the Dow climbed 144 points on average volume.  The advance/declines were 3 to 1 positive.  This should put the summation index back up but it is basically trending sideways.  I did leave in an open order overnight for the SPY July calls but it did not have a chance of getting filled when we rallied.  I do think that the market is about to get going one way or the other.  The Bollinger bands on the S&P 500 are about as tight as they can get, which implies a big move.  I think it could go either way.  Yesterday I was convinced of a breakdown.  Today I'm thinking just the opposite.  The resistance is still the 2450 level on the S&P.  A good volume break through there and we'll be off to the races.  GE was off 1/8 on average volume.  Gold was up a few bucks on the futures as the US dollar continued lower.  The XAU and GDX had slight fractional gains on very light volume.  Mentally I'm feeling OK.  We are back to no clear trading signal as the short term signals have come and gone.  The technical indicators have turned back up for the stock indices and that is a plus.  The VIX has calmed back down.  There is still plenty of time in the July option cycle to make a trade.  I suppose that I'll just have to be patient here and see where we go in the next couple of days.  If we do get through 2450 on the S&P, it's probably best to just jump on board for the ride.  There would be new money coming on board plus some short covering.  We'll have to see if it happens though.  We've got a long holiday weekend coming up as well.  Europe and Asia were mostly lower overnight.  We did not get any downside follow through today.  We'll see if we get any upside follow through tomorrow.  

Tuesday, June 27, 2017

The Dow fell 98 points today on average volume.  The advance/declines were almost 2 to 1 negative.  The summation index will be back to heading down.  No reason really for the drop but all the short term technical indicators had rolled over.  We are just about short term oversold and another day like today will do it.  I'm leaning towards getting some SPY July calls tomorrow on weakness.  The overall market was much weaker than the Dow and that isn't bullish.  The problem for getting long here is that all the things that I've mentioned recently still exist.  The leadership of the Dow vs. the small caps.  The negative RSI divergence on the S&P 500 weekly chart.  The resistance at 2450 for the S&P.  So can this turn into something bigger to the downside?  Stay tuned.  GE was off 3/8 and volume picked up heading lower in price.  Short term oversold here.  Gold was pretty much flat on the futures despite the US dollar heading down sharply.  The XAU lost a point and GDX fell 1/3 on better volume.  I still have an open order in for the October ABX calls.  Mentally I'm feeling OK.  Although we may head a bit lower in the short term, I think that trying the SPY July calls here could be worth a shot.  It would have to be a short term deal but I would at least like to hold them until the 4th of July.  The timing on the entry here is most important but if we simply keep dropping here the trade would be off.  I will have to recheck the indicators and the charts tonight to figure out what to do tomorrow.  My overall thinking though is that this is the beginning of something sustained to the downside.  I could be wrong.  Asia was a bit mixed and Europe lower in last nights trading.  We'll see if we get any downside follow through tomorrow.

Monday, June 26, 2017

We started the day with a gain of over 100 points on the Dow but faded for the rest of the session.  The Dow finished with a gain of 14 points on light volume.  The advance/declines were shy of 2 to 1 positive.  The summation index should be back to trending up.  The NASDAQ was a loser as the overall market picture here is mixed.  We haven't been able to sustain a rally but we haven't sold off yet either.  The S&P 500 tried the 2450 level again and was turned back.  If we could make it through there on good volume, the rally would be on.  The short term technical indicators are mid-range.  I'm unsure of what to do here.  GE was up a few cents and the volume was lighter.  Gold dropped over ten bucks on the futures as the US dollar was a bit higher.  The XAU and GDX had slight fractional losses on light volume.  The fact that the gold shares didn't drop with the price of gold is an encouraging sign for the gold share bulls.  But it's only one days worth of price action.  Mentally I'm feeling OK.  When in doubt, stay out is an old wall street saying.  Getting mixed signals here as the small stocks look like they're ready to roll over here again.  The VIX is back below 10 as well.  I do not have a clear direction of where things are going to go here.  I was sold on the downside as of last week but we've had plenty of chances to drop and it hasn't happened.  The Bollinger bands are converging, so something has to give soon.  The big cap short term indicators are starting to turn back up again.  You can really make a case for either direction.  There's still plenty of time left in the July option cycle so there is no hurry to do something.  We also have a long holiday weekend coming up.  So I will try and be patient and wait for a legitimate signal.  Europe and Asia were higher overnight.  We'll see how things shape up tomorrow.

Friday, June 23, 2017

A kind of lackluster session to end the week as the Dow lost 2 points on very heavy RUT rebalancing volume.  The advance/declines were 2 to 1 positive.  The overall market was stronger than the Dow.  This should turn the summation index back to sideways.  The market has had chances to sell off since Monday and it hasn't happened.  We are now looking at a possible SPY call set up on weakness Monday.  If we are lower Monday it will trigger a short term buy signal for the S&P 500.  It appears my idea for a decent drop here is not going to happen right now.  I'll have to recheck the charts this weekend.  But it looks like now we will head higher from here.  GE was up a couple cents on average volume.  Gold found a bid again on a weaker US dollar.  The precious metal futures added $7.  The XAU gained 1 2/3, while GDX added 3/8.  Volume was about average.  The short term indicators for the gold shares have turned up and have room to run.  ABX broke its short term downtrend line today.  It appears that perhaps I've missed the longer term gold share call trade but there is a lot of time to go until October.  That said, the volume here hasn't been impressive and perhaps we'll eventually work our way lower here again.  That could be wishful thinking.  Mentally I'm feeling OK.  A pretty uneventful week for stocks as we try to figure out the way from here.  We've got the end of the month coming up next week along with a GDP revision.  The S&P 500 looks like a potential short term buy here in my view.  But I'll have to see how things look this weekend after checking all the indicators.  Next week could be the last gasp of real trading for a while as a long holiday weekend is coming up followed by summer.  Maybe we'll get one more push to new all time highs in the S&P.  Although that weekly negative RSI divergence just doesn't go away.  They'll be plenty to ponder in the next couple of days.  Asia higher and Europe lower overnight.  For now it's Friday afternoon and time for a break.

Thursday, June 22, 2017

A bit lower today as the Dow fell 12 points on average volume.  The advance/declines were positive.  The summation index is still trending down.  The market dropped from positive territory in the final half hour.  It doesn't appear that there will be the light volume rally that we need to see in order to get some SPY July puts.  I'll still have to remain patient for the time being.  GE was off about 1/4 on good volume.  Gold was up $5 on the futures as the US dollar was little changed.  The XAU added 1 1/2, while GDX rose 1/4 on almost average volume.  ABX rose 1/3 and is now right at a down trend line that began in April.  Perhaps I've missed this opportunity as well.  Mentally I'm feeling OK.  A pretty quiet week so far for the major stock indices after the nice upside move that we saw on Monday.  The lack of follow through after that rally seems noticeable to me and I really do think that we are getting ready to see some sustained downside for stocks.  I could be wrong.  I'll be keeping an eye on the summation index for clues.  Not much else to report from todays price action.  We do have the RUT rebalancing tomorrow.  Europe and Asia were both mixed overnight.  We'll close out the trading week tomorrow.  

Wednesday, June 21, 2017

The Dow fell 57 points today on average volume.  The advance/declines were shy of 2 to 1 negative.  The summation index is now heading down.  Unlike yesterday the small stocks did pretty well and were strong out performers.  The overall market was much stronger than the Dow.  I'm still in the camp of more downside here.  What I'd like to see is a light volume rally attempt back to the recent new all time highs.  That would be where Id look to try the SPY July puts.  We'll see how things play out going forward.  GE was off 1/3 on average volume.  I don't have any trades in the works here at the moment.  Gold was up three bucks on the futures as the US dollar was a bit lower.  The XAU was up 1 1/8, while GDX added 1/3.  Volume was light.  My order for the ABX October calls remains in place.  Mentally I'm feeling OK.  A couple days of decline here doesn't exactly make a trend but I do think that a change is coming.  I'll take my cues for now from the summation index and that has turned around.  However with the small stocks taking the lead today, perhaps my ideas here are wrong.  But volume has picked up a bit going lower and that is something to watch.  There really isn't much data to come out yet this week to make a difference.  So I'll be patient for now and hope my light volume set up happens in the next few sessions.  Europe and Asia were both lower again overnight.  We'll see what tomorrow brings.

Tuesday, June 20, 2017

Back to the downside today as the Dow fell 61 points on average volume.  The advance/declines were over 2 to 1 negative.  This should turn the summation index lower.  The overall market was much weaker than the Dow.  We did not get any upside follow through to yesterdays gains.  There is a chance that yesterday was a short term top as the technical indicators have now rolled over on the charts.  The TRAN got clobbered today.  The negative divergences that I have previously mentioned may now come home to roost.  It is only one day lower but I have the feeling that this could be the beginning of something more.  The Dow has been leading the way here and that is usually a late stage of the up trend event.  GE was off 2/3 and the volume was heavy.  The resistance at $29 is pretty strong.  Gold and the US dollar were both little changed.  The XAU and GDX had fractional losses on light volume.  I did place an open order for some ABX October calls.  We'll need to see a drop in ABX for this order to be filled.  ABX was off 1/8 today.  Mentally I'm feeling OK.  I really think we're going to head lower here as the signs of technical deterioration have been there for a while.  The under performance of the small stocks has not been a good sign for the bulls.  Yesterdays rally was on light volume.  We also finished near the lows for the session.  The SPY options are still rather pricey with so much time left until the July expiration.  But the market won't wait around if it wants to go lower.  I'll check the option premiums again tonight and try to come up with an entry point.  We will also need to see some follow through lower on Wednesday to confirm the weakness.  If we do head lower I think that will confirm my thoughts.  Europe and Asia were both lower overnight.  So after we saw a global push into stocks on Monday, we got the exact opposite on Tuesday.  I think that caution is advised.  This has the potential to be something more than just a pause before we move higher.  We'll keep an eye on the overnight action.  

Monday, June 19, 2017

The strength showed up today as the Dow climbed 144 points on light volume.  The advance/declines were shy of 2 to 1 positive.  The summation index should be moving back up.  Still overbought and staying there for the big caps.  The small caps are coming off of their oversold readings.  Interesting how the market just happens to climb after the June expiration has passed.  Never under estimate the market makers in this game.  They'll do what they have to and keep the profits rolling.  New all time highs for the Dow and the S&P.  Perhaps this is the beginning of the summer rally.  Just a guess on my part.  GE was off 20 cents on lighter volume.  Stalling at resistance here.  Gold dropped over $10 on the futures as the US dollar was higher.  The XAU and GDX had slight fractional losses on light volume.  I still favor the longer term gold share calls as a trade within the next few weeks.  Mentally I'm feeling OK.  Plenty of time in the July option cycle for a trade.  It is just a matter of getting a decent signal as always.  No hurry here as I'll simply have to wait for something to develop.  Not a lot of economic data to trade off of this week.  There is no overhead resistance for the S&P 500 but we will not stay overbought forever.  Europe and Asia were both higher overnight as money is flowing into stocks around the globe.  We'll keep an eye on the developments this evening.

Friday, June 16, 2017

A pretty quiet quarterly expiration as the Dow gained 24 points on extremely heavy volume.  The advance/declines were positive.  The summation index is back to trending sideways.  I did expect higher prices over the past two days and it didn't happen.  I'll still be looking for some upside early next week.  Or perhaps my view of things here is simply off.  I am looking for a spot to purchase some SPY July puts.  The weekly negative divergence that I see on the chart hasn't gone away.  The problem is the premiums for the July options are expensive, with an extra week of time on them.  GE was up a few cents and the volume was very heavy.  Plenty of overhead resistance here.  Gold was up a couple bucks on the futures as the US dollar fell.  The XAU and GDX were little changed on average volume.  The lack of progress in the price of gold despite the fall in the dollar is a concern for the precious metal bulls.  Mentally I'm feeling OK.  So here we are.  The big caps have held up here and are closer to short term overbought.  The small stocks have sold off and are short term oversold.  The Dow has been the recent leader.  In my mind the market is getting more narrow and we are closer to some sort of top rather than some sort of bottom.  But how can we trade it?  I'm still going to have to wait for some sort of signal, despite the last one for strength at the end of this week not working.  There isn't a lot of economic data out next week so we'll probably just trade off of the technical readings unless there is a headline event.  Perhaps the summer slowdown will begin.  I do not have any solid trading ideas right now but I'll be checking the charts over the weekend.  The ideal scenario in my mind would be a light volume rally to get short term overbought all the way around.  Then attempting the July puts would make sense to me.  But as always the market will go where it wants.  It's Friday afternoon and time for a rest.

Thursday, June 15, 2017

A bit lower today as the Dow fell 14 points on light volume.  The advance/declines were negative.  The summation index is still trending up but sluggishly.  The overall market was weaker than the Dow again.  Keep that in mind going forward.  The small stocks are lagging and that is a sign of a tired market.  The S&P 500 was down almost 20 points early on.  I did place an order for the SPY June calls but it wasn't filled.  I was only going to attempt this trade on my terms and the option price didn't hit my target.  You could make a case for trying it again tomorrow on weakness but I think that I'll step aside.  My idea for this trade was valid though and I'll take that moving forward.  I would not be surprised with an up session to tomorrow to close out the week.  My work says to expect higher prices late this week but we are almost out of time.  GE was up 1/2 on pretty good volume.  Plenty of overhead resistance at 29-29.5.  Gold fell $20 on the futures as the US dollar rallied.  The XAU lost 1 1/3, while GDX shed 1/8.  Volume was good.  The gold shares took most of their losses for the move in gold yesterday.  It looks like the dollar could rally from here so that should add to weakness in the precious metal.  I'll be keeping an eye on the longer term gold share calls here going forward.  ABX will be my preferred vehicle.  Mentally I'm feeling OK.  Another option cycle goes by without a trade.  I can't say that there was a lot of opportunities as the S&P has moved sideways the past couple of weeks.  The July option cycle has an extra week and a holiday on a Tuesday.  I'm certainly not looking to go long anytime soon as the tone of things has changed.  There is still what I consider a glaring negative divergence on the RSI for the S&P 500 weekly chart.  The non leadership of the small stocks is not a positive.  The leadership of the Dow here is usually a late stage bull market indicator.  We'll see how things play out from here.  Europe and Asia were weaker in overnight trade.  We'll have the quarterly expiration as we close out the trading week tomorrow.

Wednesday, June 14, 2017

Another mixed bag today as the Dow rose while the overall market was lower.  The most watched index gained 46 points on average volume.  The advance/declines were slightly negative.  The summation index is moving up but barely.  We did get a sell off during the Fed press conference but the market came back.  I did place an order for the SPY June calls but once again it wasn't filled.  I'm willing to try this again tomorrow if we see some weakness because I'm convinced that we'll see higher prices going into the expiration on Friday.  However today may have been the last chance to try that.  The Fed raised rates a quarter point as expected.  The economic data out today was weak.  GE was up 1/4 today and the volume was good.  I don't see any trades here at the moment.  Gold was off $6 on the futures and fell off of its highs.  The US dollar finished little changed but did come up from its lows.  The XAU shed 3 1/4, while GDX lost 3/4.  Volume was heavy and the daily candlestick pattern is bearish.  This will be the time to keep an eye on the longer term gold share call options.  Mentally I'm feeling OK.  There is no doubt here that the overall market is weaker than the Dow.  That is a change from how it's been for quite some time.  It isn't a bullish development but it can sometimes take some time for this to play out.  It is something to be aware of though.  Two days left in the June option cycle and if we get weakness early tomorrow, I'll probably try the SPY June calls.  It's risky but my work is calling for higher prices in the next two days.  If we simply rise from the open then there won't be a trade worth taking and we'll roll out to July.  I expect we'll see more new all time highs in the Dow and the S&P before the week is out.  It's then quite possible that the market will head into summer mode.  Europe and Asia were mostly lower yesterday but the moves were muted.  We'll see what tomorrow brings.

Tuesday, June 13, 2017

Moving higher today as the Dow gained 92 points on light volume.  The advance/declines were over 2 to 1 positive.  The summation index is now moving higher.  It appears that the SPY June call trade won't happen.  We needed to see some more decline today to set up the trade but it didn't happen.  Perhaps if we get a sell off tomorrow I'll take the risk.  But with only three days left in the June option cycle it may not be worth it.  We did set some new all time highs today as the bull lives on.  GE fell 1/2 on heavy volume.  I guess the excitement of hiring a new CEO has worn off rather quickly.  Gold finished little changed and the US dollar didn't do much either.  The XAU and GDX had fractional moves up on light volume.  I'd like to see another sell off in the gold shares to set up the longer term call trade there.  Mentally I'm feeling OK.  We'll get the Fed tomorrow and the market should do something after the announcement.  I'm wondering if I dare attempt the SPY June calls still with so little time remaining.  My work still suggests that we'll be higher towards the end of this week.  But it simply could be that it is just too late and that yesterday was the time to purchase the calls.  I suppose I'll wait and see what happens tomorrow.  I certainly don't want to make a trade just for the sake of making one.  So we'll see.  Europe and Asia were generally higher overnight.  A rate hike is expected tomorrow and we should get one.  It may be what happens in the later press conference that gets things going.  I'll be keeping an eye on things tonight and getting ready for what could be an interesting session tomorrow.

Monday, June 12, 2017

A bit lower today as the Dow fell 36 points on pretty good volume.  The advance/declines were slightly positive.  The summation index is trying to go up but is basically moving sideways.  We did come up from the lows of the session and that's a positive.  However the small stocks are relative under performers here and that isn't a good sign.  I did place an order for the SPY June calls but it wasn't filled.  I would like to attempt this trade at some point in the next two trading days.  I do believe that we'll see strength towards the latter half of the week.  The entry will have to be spot on since there is such little time remaining in the June option cycle.  We do have the Fed to contend with on Wednesday.  GE suddenly came to life today and jumped a buck on extremely heavy volume.  The double bottom with the RSI positive divergence actually ended up working out.  GE announced a new CEO today and that was the reason for the jump.  Gold lost a couple of bucks on the futures as the US dollar was little changed.  The XAU lost almost a buck and GDX almost a dime on light volume.  I'm still considering a longer term option trade for the gold shares.  Mentally I'm feeling OK.  We got another pop in the VIX today but it is not completely overbought just yet.  One more sell off should do it but when that will happen is the question.  Once again, with only four days to go in the June option cycle the risk is very high.  I'm hoping that I'm up to the task.  With a Fed announcement thrown in there as well, you can see how difficult things can become.  I might have to wait until after the Fed meeting to put on this trade but we'll have to see how things move before that event.  I do think that the SPY June calls are the way to go here and I do think that there will be some money to be made.  We'll see.  Europe and Asia were both lower overnight as the worldwide markets are taking a breather as well.  We'll keep an eye on the overnight developments.

Friday, June 09, 2017

Volatility returned today as the market rocked and rolled for a change.  The Dow did gain 89 points on heavy volume.  The advance/declines were positive.  The summation index is still moving sideways.  However the overall market was much weaker, led by the NASDAQ which lost 113 points.  The S&P 500 had a one day reversal to the downside as it opened higher and closed lower.  It finished with a loss of two points.  I did place an open order for the SPY June puts but it wasn't filled.  I basically missed this trade as I was not quick enough to take advantage of the opportunity.  It still could work but I think the chance has passed.  I do however think that there could be a chance to play the SPY June calls next week if things line up.  GE rose 1/3 but the volume was light.  Gold dropped another $10 on the futures as the US dollar was a bit higher again.  The XAU fell 1 1/3, while GDX lost 1/3 on average volume.  We had a false break of the down trend line in gold that's been in effect for about 5 years.  This should turn traders even more bearish on gold and the next time the line is violated, there won't be a lot of believers.  I'm still looking at taking a longer term gold share call trade at some point in the near future.  ABX or GDX will be my preferred vehicles for this trade.  The next time we are both short and medium term oversold here will be the time to take the trade.  I'll go out to the September or October options.  Mentally I'm feeling OK.  A very interesting trading session today and we haven't had one of those in a while.  I did miss the put trade that I wanted to do but there is still a possibility to try something next week if things line up right.  The big 5 stocks, AAPL, AMZN, FB, GOOG and NFLX all got crushed today and that led the small stocks down.  These five issues have accounted for much of the gains in the major averages lately and when they started to fall today it simply fed on itself.  They all did bounce back some, just like the S&P.  This could be the beginning of a much needed breather for these issues or we could simply just turn around.  I'm inclined to think that things will eventually be going lower from here.  There is a glaring negative RSI divergence in the S&P 500 weekly chart.  It is only a potential event at this point, as we could somehow rally back to a higher RSI reading that would negate this pattern.  But I do not see that happening.  The problem is that we would have to roll into the July option cycle and there is an extra week of time on those options.  But it is something that I'm considering.  For now if we get a weak start to next week, I'd like to try the SPY June calls on around Wednesday.  This would be a highly risky endeavor with only two days left in the June option cycle.  But my work points to strength at the end of next week and I'd be willing to give it a try under the right circumstances.  Plenty of things to consider when checking the charts over the weekend.  Europe and Asia were higher overnight with the exception of Hong Kong.  The British election did not have the huge impact overseas as expected.  It's Friday afternoon and time for a rest.

Thursday, June 08, 2017

Another day of hanging around as the Dow gained 8 points on good volume.  The advance/declines were positive.  The summation index is still heading sideways.  We were both up and down today so it was frustrating no matter which side you're playing.  At this rate I probably won't be attempting any trades in the June option cycle.  We're still short term overbought and have been all week.  The small stocks also continue to outperform and that is a positive sign.  I think that I'll still try the SPY June puts if we get to 2450 on the S&P but that isn't a given at this rate.  The news today didn't do much for trading and we've got the election results from England coming in soon.  With only six days to go in the June option cycle the risk only increases from here.  GE was off about a dime on good volume.  Gold dropped over $10 on the futures as the US dollar was a bit higher again.  The XAU and GDX had fractional losses on average volume.  Gold has now dropped back from the breakout point of the long term down trend line.  That makes the breakout this week invalid unless we get a rally tomorrow.  Mentally I'm feeling a bit slow, did not sleep well.  So we've made it to Friday and still no trade.  Even if we do rally tomorrow, I may have to wait until Monday to attempt the put trade.  Due to the short term overbought condition of the market, I do not expect to try the calls.  The fact that we've stayed overbought for so long puts the odds of trying the calls even higher.  So at this point I'll wait to see the reaction to the British election and go from there.  Europe and Asia were mixed in last nights trade.  We'll close out the week tomorrow.  

Wednesday, June 07, 2017

More of just hanging around as the Dow rose 37 points on good volume.  The advance/declines were slightly negative.  The summation index is moving sideways.  The market is trying to figure out what to do here.  Still short term overbought for the major indices.  Ideally I'd like to see a light volume move higher from here to attempt the SPY June put trade.  But we are running out of time in the June option cycle, so the risk increases with each passing day.  We'll get the British election out of the way tomorrow along with some testimony regarding the Russia fiasco in Washington.  That may pave the way for stocks to go higher.  Or not.  GE was off 1/4 and the volume was good.  It appears that the double bottom on the GE daily chart may not work after todays price action.  Gold dropped $8 on the futures and the US dollar was a bit higher.  The XAU and GDX had fractional losses on average volume.  We'll need to see gold hang in here or move higher to have a valid break of the long term down trend line form 2012.  Mentally I'm feeling OK.  It's getting late to try a trade in the June option cycle but I'm hoping that the market will cooperate.  We should get some kind of movement tomorrow with the results of the election in England.  There's no economic data to move things.  My thought is that we just spent a couple of days to digest things after moving to a new all time high.  We now should resume the trend higher to new all time highs again.  That will be the opportunity to try the SPY puts at around the 2450 level on the S&P.  Any other scenario will probably mean that we'll have to wait for a better entry point for the next trade either way.  So we'll see what happens.  Asia was mixed and Europe lower overnight.  Tomorrow should be interesting.  

Tuesday, June 06, 2017

Lower again today as the Dow dropped in the final hour and closed with a loss of 47 points on about average volume.  The advance/declines were negative.  The summation index is now heading sideways.  A couple more days like today and the SPY June put trade will not be feasible.  The market will have to turn around here tomorrow or that trade isn't happening.  We're still short term overbought, so a pop up tomorrow might still set that trade up.  But things will have to set up just right to attempt it.  As of right now it's still a wait and see attitude for me.  GE was off a few cents on average volume.  Gold found a little life today as the futures rose $14.  The US dollar was lower.  The gold shares finally got going with the XAU up 4 1/4, while GDX climbed a point.  Volume was heavy.  It appears that gold is finally breaking through its long term down trend line that has been in effect for years.  We'll have to see how it closes out the week.  This would be a very bullish development if it holds up.  It may be too late for the longer term gold share call trade that I mentioned earlier.  I'm still considering it though if this breakout holds up and we get a pullback.  Mentally I'm feeling OK.  Only 8 days to go in the June option cycle.  I'll need to see some sort of light volume rise from here to try the SPY June puts.  Otherwise I'll have to start looking at July.  No economic data to trade off of for the rest of this week.  We do have the Fed a week from tomorrow.  But for now we're here and it appears that we're working off a short term overbought condition before making a run at new all time highs again.  That's my guess.  The action in gold today was interesting and it could be the start of something worthwhile to the upside.  But it is only Tuesday.  Asia was mixed and Europe lower overnight.  We'll see what tomorrow brings.

Monday, June 05, 2017

A quiet trading day to start the week as the Dow fell 22 points on light volume.  The advance/declines were negative.  The summation index is still moving up.  I didn't place any orders today as my thinking is that we are simply seeing a pause before we head back up.  If we are lower for the beginning of the week, I'll try the SPY June calls on Thursday or Friday.  If we start to head back up here soon,  I'll try the SPY June puts later in the week.  After todays economic data, which came in a touch weaker than expected, the rest of the weeks reporting is light.  So I expect things to be headline and technically driven for the remainder of the week.  GE was up a dime on good volume.  On the daily chart here it looks like a double bottom has been put in with a positive RSI divergence.  This could bode well for the overall market.  Gold didn't do much today despite another terrorist attack in London.  The US dollar had little change as well.  The XAU and GDX had slight fractional losses on very light volume.  They did come up from the lows of the session.  Mentally I'm feeling OK.  Really not much to take away from todays session.  We're still overbought for all the major indices.  I'd still like to see a move to the 2450 level in the S&P.  That would give me the confidence to try the puts if we can get there this week.  But the market rarely cooperates.  There's still no overhead resistance and todays volume was pretty light.  So I'm pretty sure there will be another attempt to move higher in the near term.  The only action that would negate that would be a sharp drop in price.  I'll still try to be patient but with only nine days to go in the June option cycle, the risk increases with each passing day.  Europe and Asia were lower overnight with the exception of the DAX.  We'll keep en eye on the overnight trading.   

Friday, June 02, 2017

Another day, another new all time high as the Dow rose 62 points on average volume.  The advance/declines were positive.  The summation index is heading higher.  The overall market was stronger than the Dow.  Short and medium term overbought and staying that way.  Even a weaker than expected jobs report could not derail this rally.  We came out of the sideways consolidation to the upside and there is no overhead resistance.  I still tried the SPY June puts today, adjusted the order and then canceled it.  It really seems as if long is the only way to go here.  But I will probably try this trade again in the beginning of next week.  It will be tough to do though.  GE was up over 1/8 and the volume remains good.  Gold once again was up over $10 on the futures as the US dollar continues lower.  The gold stocks just don't react though as the XAU and GDX had slight fractional moves higher on light volume.  I'm not sure what is going on but it isn't exactly bullish for the precious metal stocks.  Perhaps they're looking ahead to the expected rate hike in a week and a half.  I have no explanation.  Mentally I'm feeling OK.  The market can last longer than you can remain solvent or something like that.  That is what this rally reminds me of.  Shorts have been squeezed and new money has hopped on board for the breakout higher.  There's still a possible RSI divergence on the weekly S&P 500 chart and the daily chart is overbought.  My thinking is that perhaps the 2450 level is the place to try the SPY June puts.  That is my only idea at the moment.  But a short trade here carries plenty of risk because until we actually see some decline, there is no telling how high this thing can go.  Any bad news is being shrugged off and that's pretty bullish.  Small stocks are leading the way with the exception of the RUT.  I'll go over all the charts again over the weekend but maybe staying on the sidelines would be the smarter play for now.  But you don't make any money with that strategy.  Europe and Asia were higher as money flows to stocks worldwide at the moment.  It's Friday afternoon and time for a break.

Thursday, June 01, 2017

The Dow took off to the upside today as the most watched index gained 135 points on good volume.  The advance/declines were about 5 to 1 positive.  This will turn the summation index back up.  Beginning of the month money flows and some short squeezing was probably the cause of todays price action.  The volume was good and there is no overhead resistance.  I adjusted my open order overnight for the SPY June puts and then canceled it during the morning today.  My idea of getting puts here looks simply wrong after todays price action.  Many of the major stock indices are breaking out to new all time highs.  Volume is good, so the move up is for real.  We're both short and medium term overbought but in bull market rallies that condition can last for a while.  GE was up 1/3 on average volume.  Gold was off five bucks and the US dollar was a bit higher.  The XAU and GDX had slight fractional losses on very light volume.  Mentally I'm feeling OK.  The Dow closed at a new all time high, finally catching up to the other major averages in that regard.  It looks like there is room to go higher as well.  It now appears that the decline that we saw yesterday was the opportunity to get long.  I'm not sure how long the run up will last but some of the individual charts in the Dow look bullish.  I do still think that the June SPY puts will work at some point but I do not know when that point is.  Perhaps early next week if we continue higher.  The VIX is very low again and I suppose I could make a case for getting some S&P 500 puts tomorrow.  There are some potential negative divergences in the RSI for the small cap indices.  But we don't see anything like that for the big caps.  So I'll take another look at things tonight and go from there.  Europe and Asia were higher overnight.  We've got the employment report tomorrow and we'll gauge the stock markets reaction to those numbers.  We'll also see if the foreign markets rally off of the US price action today.  We'll finish things for the trading week on Friday.

Wednesday, May 31, 2017

A bit more weakness to end the month as the Dow lost 20 points on heavy last day of the month volume.  The advance/declines were about even.  The summation index is trending sideways.  The market started to sell off today but then came back.  I'm leaving in my open order for the SPY June puts but I've adjusted it to a lower price.  I do expect that we'll see some upside from here that could take the S&P 500 to new all time highs.  If the volume remains light, that will be the opportunity to try this trade.  If the volume picks up, then we are going higher than I anticipate.  We are still short term overbought for the S&P.  The Fed minutes came and went.  I'd expect tomorrow to be a quiet session ahead of the jobs numbers on Friday.  Perhaps if we get a rally out of that, it will give the chance for the SPY June put trade.  That's a lot of ifs and we'll have to see how it all plays out.  GE was up a couple cents and the volume remains pretty good.  Gold rose $11 on the futures as the US dollar was lower again.  Do the currency traders know something that we don't?  The XAU and GDX were basically flat on light volume.  The fact that gold continues to rise and the gold shares do not is not a positive sign in my opinion for the continued rise of the precious metal.  I could be wrong.  Mentally I'm feeling OK.  We got a signal for weakness and we have seen some in the past couple of days.  But it was not the kind of move lower that would show a lot of profit.  So I am hoping that we'll see another light volume rally here to new highs and that will be the time to get short.  That said, we know that the market rarely cooperates with our wishes.  We'll be medium term overbought after tomorrow as well.  So it is possible that things will line up in favor of trying the SPY puts.  Europe and Asia were mixed overnight.  We'll keep an eye on things overnight and see how the month of June begins tomorrow.

Tuesday, May 30, 2017

Lower to begin the week as the Dow shed 50 points on light volume.  The advance/declines were negative.  This should move the summation index sideways.  I put my SPY June put trade in again and I'm leaving it overnight.  I do expect one more run up here and that will hopefully get my order filled.  I'm certainly not committed to this trade for an extended time period but I do think it can work in the short term.  But only if the above scenario of a quick rise materializes.  We'll close out the month of May tomorrow followed by the jobs report on Friday.  The Dow was the relative leader lower today so perhaps we'll get the short term rise that I'm looking for.  GE was off about a dime on good volume.  There's a potential double bottom being put in here on the daily chart.  Gold fell about $5 on the futures and the US dollar was lower as well.  The XAU lost over 1 1/8, while GDX declined 1/3.  Volume was light.  The lower dollar didn't help gold and that isn't a positive for the precious metal.  Mentally I'm feeling OK.  A shortened trading week to deal with and today looks like many players decided to take the day off.  We were short term overbought for the major stock indices and today slightly relieved those conditions.  Volume has been pretty light lately and that is another reason not to trust the new all time highs here.  I would like to get this trade in but there is also the possibility that we simply remain overbought and continue higher.  As usual anything can happen in this game.  But I do think that getting the puts here has a chance to work so we'll have to see what the market has to say tomorrow.  If we simply head lower from here, it will be too late for this idea.  Asia was mixed with slight moves overnight, while Europe was lower.  We'll keep an eye on the overnight trading. 

Friday, May 26, 2017

It was one of those pre-holiday market days as the Dow lost 2 points on light volume.  The advance/declines were barely positive.  The summation index is still moving up.  The trading range was thin for the day with no real movement.  It was as if the summer doldrums arrived early.  There's a chance we could see this again on Tuesday but we'll wait and see.  I canceled my open order for the SPY June puts and will reconsider this idea over the weekend.  Although I am still committed to the trade for now.  Short term overbought, staying that way and that is the hallmark of a bull move.  GE lost a few cents on average volume.  Gold rose $10 on the futures and the US dollar was up a bit as well.  The XAU and GDX had slight fractional gains on light volume.  Mentally I'm feeling OK.  Off to a 3 day weekend for traders.  We'll come back next week to close out the month and view the employment report.  June isn't the most bullish month in the calendar but predicting a drop in this market seems impossible.  That said, I do think that a some point next week trying the SPY June puts will be worth it.  I could be wrong.  I'll have an extra day to try and figure out if that strategy is viable.  But first I think that taking a day or two off from the game isn't a bad idea.  I will get around to checking the charts as usual in the next few days.  For now it's Friday afternoon and time for a break.

Thursday, May 25, 2017

The rally continues as the Dow climbed 70 points on average volume.  The advance/declines were slightly positive.  The summation index is still moving up.  The overall market was stronger than the Dow.  We've broken through the resistance on the S&P 500.  There appears to be nowhere to go but up.  I did place an order for the SPY June puts today but canceled it later on.  However I also decided to leave in an open order overnight for the SPY June puts as well.  We're short term overbought here but could stay that way because we are in rally mode.  I do however, want to attempt this trade.  The overnight order will only be filled if we get a decent rally tomorrow morning.  Now this could absolutely be the wrong strategy here but I think it is worth a shot.  GE dropped another 1/3 and the volume was good.  GE certainly has not participated in the rally since the election.  Gold was up a couple bucks and the US dollar was a bit higher as well.  The XAU and GDX had fractional losses on light volume.  Mentally I'm feeling OK.  We'll get the GDP revision tomorrow along with durable goods.  It's a Friday before a holiday weekend.  I'm thinking that the players will be leaving early.  We do have some major stock indices at new all time highs with some potential negative RSI divergences.  They are only potential though.  I'm not sure that the SPY June put idea is the best thing to do here but I will be sure to put the stop loss order in if it gets filled.  Early next week could be another time to try this trade if it doesn't get filled tomorrow.  I do have a sell signal on one of my short term indicators.  However these signals can be unreliable in up trends.  RUT is under performing here and that could be a clue.  It did lead the way up but has since stalled.  Perhaps I'm only looking at the indicators that would make the put trade seem feasible.  Certainly a case can be made that we'll simply continue to rally from here.  The theory that we sold out last Wednesday on the Trump headline has proven to be valid so far.  So maybe my idea here is wrong.  We'll see what happens tomorrow and go from there.  Asia was higher and Europe mixed overnight.  We'll finish up the trading week tomorrow.  

Wednesday, May 24, 2017

It's as if last Wednesday never happened as the Dow gained 74 points on light volume.  The advance/declines were positive.  The summation index is heading up.  The S&P 500 closed at a record high.  The small stocks are acting OK but the RUT is lagging.  We're back to short term overbought for the major stock indices.  I did place an order for the SPY June puts but it wasn't filled.  I may be early on this trade but could try again tomorrow.  The volume here is light, so I do not really trust the rise.  However if we break out tomorrow with good volume, the rally could be on.  GE continues to struggle as it lost almost 1/2 today on heavy volume.  Gold did find a bid after the Fed minutes but the futures only rose a couple bucks.  The US dollar was lower.  The XAU gained a point and GDX added 1/3.  Volume was average.  Mentally I'm feeling OK.  I'm looking for the next trade here but certainly there is no rush.  Both short and medium term overbought but in bull markets we simply stay that way.  We've also got a holiday week coming up so I may want to let that go by as well.  That said, if I see another light volume levitation tomorrow I may do the trade.  We're at the top of the sideways channel that's 3 1/2 months old.  The VIX has now calmed back down and is almost back under 10 again.  It's also possible that I want to put on a trade since I haven't done one in so long.  That must be guarded against at all costs.  I have my reasons for trying the SPY puts here but I could be wrong as well.  The way the market came right back after dropping hard last week tells me there are still buyers out there.  I'll reconsider things overnight and go from there.  Asia was higher and Europe lower overnight but both had small moves.  We'll keep an eye on what transpires in overseas trading tonight.

Tuesday, May 23, 2017

Up another 43 points today for the Dow on light volume.  The advance/declines were positive.  The summation index is heading back up but not with any conviction just yet.  Approaching new all time highs again for some of the major stock indices.  However the volume here is light and that is a concern.  The small stocks were under performers again and that is another problem.  I've been bullish for quite a while but that is beginning to change.  If we do continue higher for the next couple of days on light volume, I'll be looking for the SPY June puts.  GE was up a dime and the volume was light.  Gold was lower as the US dollar got a bounce.  The precious metal futures lost $10.  The XAU shed 2 1/3, while GDX lost 1/2.  Volume was average.  I'm still considering a gold share call trade with an extended time period in the coming weeks.  However for now I have to wait for an oversold condition and we are not close to that yet.  Perhaps in June.  Mentally I'm feeling OK.  Nothing but higher prices since the Trump debacle of last week.  It is appearing to be a one day wonder but the upside volume seems to be drying up to me.  Who knows?  Maybe we'll get the high volume breakout that I've been looking for.  The problem for me is I do not see where that would come from.  We've got the Fed minutes tomorrow and the GDP revision on Friday.  Will that be enough to move us forward in a big way?  I don't think so.  The S&P 500 has been sideways since mid-February.  It looks like a distribution top to me now, since it has taken so long to form and really nothing has happened to break prices higher.  The market has ignored a lot of bad news.  But unless price bursts higher soon, I'll be looking to get some puts.  June is not the kindest month for stocks either.  Asia was mixed and Europe generally higher overnight despite yet another terrorist attack in England.  We'll see what tomorrow brings.

Monday, May 22, 2017

The bounce from last Wednesdays debacle continues as the Dow gained 90 points on light volume.  The advance/declines were 2 to 1 positive.  This should turn the summation index back up.  The overall market was stronger than the Dow and that's a plus.  The small stocks acted better too.  I looked for some ideas all weekend but came up empty.  I'm waiting for the next technical signal now and will trade it either way.  If we approach the resistance again on light volume, I'll look towards the SPY June puts.  If we pull back from here and get oversold, I'll try the SPY June calls.  Patience is the idea for now and it isn't a bad one since we just rolled into the June option cycle.  GE was up 1/8 and the volume was light.  Gold rose six bucks on the futures as the US dollar was lower.  The XAU gained a point and GDX added 1/3.  Volume was light.  I'm also considering some gold share calls in the coming weeks but with the expiration in the fall.  Septembers or Octobers are what I'm looking at if they get oversold in the coming weeks.  Just a thought for now.  Mentally I'm feeling OK.  Volume continues to lighten as we move higher and that is not a positive.  However the price action since the huge one day drop is.  Perhaps if we back off from here and retest the low it will give me a chance to get some SPY June calls.  But even that scenario could go wrong if we don't get oversold as well.  I will say that we've had plenty of chances to break out higher through the overhead resistance and continue to fail.  That's not a good sign.  A breakout with volume will be the clue to buy some SPY calls because there won't be any overhead resistance.  But we haven't been able to get there yet.  Asia was higher and Europe generally lower in last nights trade.  We'll keep an eye on the overnight developments.

Friday, May 19, 2017

Still moving up but we did finish off of the highs for the day.  The Dow gained 141 points on good volume.  The advance/declines were 3 to 1 positive.  That should stop the decline in the summation index.  The small stocks are not out performing here and that is a concern.  They are however, oversold.  Not sure what we've seen this week as I thought that we have a distribution top in place after Wednesdays debacle.  But when the market goes down it simply goes down.  It doesn't really rally like it has in the past two days.  The problem there is that it simply could be expiration related and not the start of a new trend higher.  So many questions and so few answers.  GE finally came to life.  It gained more than 1/2 on good volume.  Gold was up a couple bucks on the futures which was disappointing considering the drop today in the US dollar.  The XAU and GDX had fractional gains on light volume.  Mentally I'm feeling OK.  Quite a volatile weeks for stocks as we were shaken out of complacency, courtesy of Trump.  Perhaps the worst is over for now but you never know when another surprise in the headlines might come up.  Some will argue that it's always the case but I do think the odds go up when you've got a guy like Trump to deal with.  The market did ignore most of the noise up until this week.  As always, the market knows more than you and me.  Sticking with the technical indicators for the S&P, they've already turned back up.  One of the problems now is that by rolling into the June option cycle the premiums are already pretty high.  Add in the recent volatility and prices are more than they normally would be.  So any trade here had better be right because volatility premium will be coming out of the options as we move forward.  I'm now more inclined to believe that Wednesday was an aberration.  However I will spend the weekend trying to determine where we go from here and how to trade it.  There's no rush to trade.  I do think that the lack of small stock leadership puts a lid on any upside going out from here.  I could be wrong and I'll have a couple of days to assess the situation before moving ahead.  There's plenty of work to do.  For now it's Friday afternoon and time for a rest.

Thursday, May 18, 2017

Got a bounce today as the Dow came back 56 points on good volume.  The advance/declines were barely positive.  The summation index is heading lower.  Not the greatest move up in the world but at least we've stopped going down.  There's probably more to go on the downside but how much is the question.  Yesterday certainly got the attention of all the players so we'll see where we go from here.  Getting short term oversold for the S&P 500 but not there yet.  I think the best thing to do now is let Friday pass and try and figure out what to do over the weekend.  That way you can take the time to go over possible scenarios and be ready for next week.  GE was up a few cents on heavy volume.  If GE is putting in a bottom here, that would be a positive for the overall picture in my view.  Gold was off over ten bucks on the futures as the US dollar had a bounce as well.  The XAU lost 2 1/4, while GDX shed 3/4.  Volume was good.  That's probably it for the recent bounce in gold.  Mentally I'm feeling OK.  The shock from yesterday is wearing off but we are still in an event driven theme for the market until this calms down.  The thing with Trump is that he never really does calm down but the market usually doesn't pay attention.  So we'll have to see if all the fuss is for real or not.  I'm still thinking that we just had a distribution top put in and it will be a while before we attempt new all time highs again.  But maybe I'm wrong.  Maybe this is the last of the sellers getting out of the way before we get a good volume break out to the upside.  There's always two sides to the story but I'm leaning towards the negative one at this point.  So we'll see.  Europe and Asia were both lower overnight.  We'll close out the week tomorrow.  

Wednesday, May 17, 2017

Well that should be it for new all time highs for a while as the Dow got clobbered today on Trump drama.  The most watched index fell 372 points on good volume.  The advance/declines were almost 4 to 1 negative.  The summation index will be heading down.  We're now at the mercy of headline risk and that is a tough environment to trade.  I'm not sure how low we'll go here but this probably isn't just a one day wonder.  I could be wrong.  It now appears that we just had a multi-month distribution and are falling away from that.  If so, support looks to come in for the S&P at 2330 and then 2280.  Trump has been in the headlines since the election but this is the first time he's had a real negative influence.  GE lost almost 2/3 on heavy volume.  Perhaps GE had the right idea all along.  Look for at least some support at 26 which is the 200 day moving average.  Gold found a bid on safe haven activity.  The precious metal futures rose $24.  The dollar continues to fall due to the uncertainty now in Washington.  The XAU and GDX had fractional gains on OK volume but the gains were not that great considering the circumstances.  Mentally I'm feeling OK.  Volatility returned today with a vengeance.  How long this lasts is unknown.  It should provide some trading opportunities though.  With only a couple of days left in the May option cycle, looking out to June makes sense.  If and when we get to support, I'll take a look at the June SPY calls.  But it really is too early to tell what will happen from here.  The VIX is overbought here but not extremely so.  Most of the short term indicators for the major stock indices have rolled over but are not oversold.  That tells me that we probably have more downside to go.  Tomorrow should be interesting as well.  We practically closed on the low for today.  I'd advise to simply sit back and watch for the rest of this week.  Europe and Asia were lower overnight but not as much as the US.  We'll see how they fare overnight.     

Tuesday, May 16, 2017

Back to hanging around as the Dow lost 2 points on average volume.  The advance/declines were negative.  The summation index is heading sideways.  The NASDAQ continues to out perform as it remains very overbought.  I'm still looking for higher prices here in the short term.  What we really need to see is a high volume breakout one way or the other to get things going.  With the small stocks doing so well there really isn't a reason to be bearish here.  The economy seems to be plugging along and the market with it.  GE lost another 1/8 and the volume was average.  Gold was up $7 on the futures as the US dollar dropped again.  The XAU and GDX had slight fractional gains on very light volume.  Still no love for the gold shares.  Mentally I'm feeling OK.  It doesn't appear as though I'll be getting in a trade for the May option cycle.  We'll have to look out to June.  There really isn't a clear signal at the moment as the SPY call opportunity has passed for this week in my opinion.  So patience will be the strategy for the time being.  I certainly don't want to press the issue or start to get into a guessing game.  So the sidelines are where I'll be for now.  Europe and Asia were generally higher overnight but no big moves.  We'll see what tomorrow brings.

Monday, May 15, 2017

We had an upside gap at the open and the Dow finished with a gain of 85 points on average volume.  The advance/declines were 3 to 1 positive.  This should turn the summation index back around but not out of the sideways pattern.  There was no weakness in the morning to take the SPY May call position and it is probably too late now.  I'll have to chalk it up to just another missed opportunity.  With only 4 days to go in the May option cycle, any trade attempted now would have a ton of risk.  I'm looking for the SPY to hit the 241 level at least.  We hit a new all time high for the S&P today and there is no overhead resistance.  GE was off almost a dime on good volume.  No doubt that GE is not participating in the move higher for the overall market any way you look at it.  Gold was up a couple bucks as the US dollar was lower.  The XAU and GDX had very slight fractional gains on light volume.  Mentally I'm feeling OK.  So where do we go from here?  I'm still convinced that we'll be moving a bit higher from here but without expanding volume any rise will be sluggish.  If we get a high volume breakout I would suggest jumping aboard.  But we haven't seen that yet.  We do have the positive expiration bias in our favor this week if you're bullish.  I suppose I'll have to start looking out to the June SPY options.  Not exactly sure which way to go there yet.  However with the small stocks extremely overbought and RUT lagging the puts could be the way to go.  But as always, waiting for a decent technical signal will be key.  Europe and Asia were both higher in last nights trade.  We'll keep an eye on things tonight but it appears that there will not be any trades for me this week.   

Friday, May 12, 2017

Just another day in a listless market as the Dow fell 22 points on light volume.  The advance/declines were negative.  The summation index is barely moving lower.  The NASDAQ was up again today in the usual mixed market that we have been held hostage to for the past three weeks.  The short term technical indicators have rolled over for the S&P.  That's one reason not to be in a hurry to get the SPY calls here.  That said, I do believe that any weakness can be bought on Monday for a short term trade.  Of course it will have to short term since there is only a week left in the May option cycle.  I canceled my open order for the calls but will probably be putting it back on Monday morning.  GE got crushed today on a downgrade and was off almost 2/3 on very heavy volume.  If GE is a precursor for the overall market then lower prices loom.  Gold was up a few bucks on the futures and the US dollar was lower.  The XAU rose 1 1/8, while GDX added 1/3.  Volume was light.  The gold shares had a good week but the volume just wasn't there.  Which means we'll probably be heading lower going forward.  Mentally I'm feeling OK.  Low volatility, mixed markets and no real price movement despite the statistics coming out.  This is a confusing set of circumstances for me.  I'm not even sure if it is worth putting on a trade next week.  I do still favor the SPY May calls for the short term but it won't be an easy trade to do.  We've stalled for so long at the level to break out to new highs that it may be getting too late.  We are either getting all the selling done before a breakout or the final lemmings are being sucked in before we drop.  Expiration week usually has a positive bias so the bulls will have that going in their favor.  One of my short term indicators is in the buy signal range as well.  I'll probably try the call trade if we're lower on Monday but I'll also go over everything this weekend to see if it is worth the risk.  Once again, the timing in and out will have to be spot on.  Asia was generally lower and Europe higher overnight.  It's Friday afternoon and time for a break.    

Thursday, May 11, 2017

A sell off and a comeback today as the Dow fell 23 points on good volume again.  The advance/declines were negative.  The summation index is still trending sideways.  We were off almost 150 in the morning but buyers stepped in.  My open order for the SPY May calls wasn't filled but it did get close.  I've adjusted the order for overnight but it's possible that the opportunity is gone.  The Dow did bounce off of its 50 day moving average.  The market has repeatedly tried to sell off but has made a comeback each time.  Sooner or later this pattern won't hold up but it has so far.  GE was up over 1/8 on average volume.  If we could put in a bottom here it would be overall constructive in my opinion.  Gold was up 5 bucks on the futures and the US dollar was little changed.  The XAU rose 2 1/3, while GDX gained almost 1/2.  Volume was better.  I don't think that this is the start of a new trend but what do I know?  Mentally I'm feeling OK.  Running out of time in the May option cycle.  However I'm still willing to attempt a SPY May call trade under the right circumstances.  We'll get more inflation data and retail sales data tomorrow morning.  If we see another sell off, there's a chance that my open order could get filled.  I'm also looking for the usual positive expiration week bias to show up next week.  The short term technical indicators for the S&P 500 have rolled over and that may be a concern.  The price action in the next couple of days will tell us if it's for real or not.  I don't believe that it is just yet.  The small caps continue to hold up well and out perform the overall market.  As long as that's the case I can't get too bearish.  But that could all change at any time.  For now however, I'm going to continue to look for higher prices.  Asia was higher and Europe lower last night.  We'll finish up the week tomorrow.   

Wednesday, May 10, 2017

More of the same here for the market as the Dow fell 32 points on good volume.  The advance/declines were almost 2 to 1 positive.  The overall market was stronger than the Dow.  The summation index is trending sideways.  Basically moving sideways in the S&P 500 for 2 1/2 weeks.  Indicators remain overbought and staying that way.  I did place an overnight order for some SPY May calls but it wasn't filled.  I'm leaving the order in overnight.  Sooner or later we'll get some kind of breakout.  The question remains, in which direction.  I'm still looking for an upside resolution.  GE was off 1/4 on what passes now for average volume here.  We're still oversold here.  Gold was up a couple bucks on the futures, while the US dollar was little changed.  The XAU rose 1 1/3 and GDX gained 3/8.  Volume was light.  Mentally I'm feeling OK.  Running out of time in the May option cycle.  The timing of any trade from here on out would have to be impeccable.  It can be done but you've got to have the market cooperate as well.  If we get some pullback, I'd be willing to go the other way with the calls.  If we start to rally, there is not overhead resistance so purchasing some puts would be even riskier that usual.  Not to mention the running out of time factor.  Volatility seems to have disappeared and the lack of price movement is frustrating.  So I do think that the prudent course of action remains to wait for a decent set up and go from there if we get one.  If we don't, I'll simply have to wait for the June option cycle.  Europe and Asia were generally higher overnight.  We'll keep an eye on tonights developments.

Tuesday, May 09, 2017

Another day of not much but there was a little volatility in the final hour.  The Dow fell 36 points on good volume.  The advance/declines were negative.  The summation index is basically moving sideways.  Another down day would change that.  Nothing new to report.  The short term technical indicators for the major stock averages remain overbought.  I still favor the SPY May calls between now and expiration.  If we drift lower in the next couple of days, I'll give that trade a shot.  Until that happens it's just a wait and see attitude.  GE was off 1/8 and the volume was light.  Oversold here for GE.  Gold fell $5 on the futures as the US dollar rose again.  The XAU and GDX had very slight fractional losses on light volume.  The gold shares haven't followed gold lower here in the past couple of days.  Perhaps things will turn around soon.  But that's a guess as usual.  Mentally I'm feeling OK.  The overall market was stronger than the Dow today and that's a plus.  But the overall lack of movement in the major averages is not helping the trading.  It's great if you're a writer of options but not if you are looking for gains on directional movement.  I'm going to try not to press the issue here but I would still like to do a trade if the conditions set up properly.  No guarantees that will happen.  Asia was mixed and Europe higher in last nights trade.  We'll see what tomorrow brings.