Wednesday, January 25, 2017
Well we made it. The Dow closed above the 20000 level for the first time in history today. The most watched index gained 155 points on good volume. The advance/declines were about 2 to 1 positive. The summation index is moving higher. There is no overhead resistance and any declines can be bought in my humble opinion. I thought that this may have been for real yesterday and now we know. I'm also just kicking myself for not getting on board which is what I should have done despite the short term overbought condition. However we now know that calls will be the way to go if and when we see any weakness. Still plenty of time in the February option cycle but the optimum entry point has passed. GE was up 1/3 on the same volume as yesterday. Perhaps the next trade will come here. Although GE has a reputation for moving sideways for extended periods of time. Gold fell back $11 and the US dollar was weaker as well. The XAU lost 1 1/2, while GDX shed 1/3. Volume was light. If the dollar remains weak, it should support gold. In theory anyway. Mentally I'm a bit frustrated for missing this spike higher. Every indication yesterday pointed to the fact that it might be happening but I did not pull the trigger. Even though we are extended here, the path of least resistance is up. I do still think there will chances to make a winning trade going forward though. I'll wait for some type of pullback but if we don't get one I will have to change my strategy. For now I'll have to be patient yet again. Europe and Asia were higher as money around the globe is now flowing into stocks. We'll keep an eye on the overnight trading.