Friday, February 03, 2017
A nice rally today to end the week as the Dow soared 186 points on average volume. The advance/declines were shy of 4 to 1 positive. The summation index will be moving back to the upside. The employment report was better than expected on some counts and we took off from the open. I'm still considering the SPY February calls because if the S&P 500 can get through 2300, there is no overhead resistance. I still believe that declines can be bought but the best opportunity passed yesterday in my mind. If we can get some decline on Monday, that might be the time to take another stab at that trade. However we will be getting short term overbought here in a hurry. GE was up a couple cents on average volume but continues to lag. GE is out of sync with the overall market. Either the market is ahead of itself or GE needs to play catch up as the overall rally continues. The technical indicators are oversold on the short term and mid-range medium term for GE. Perhaps I should try a trade here. Gold was up a couple bucks despite the decent jobs report. The US dollar again finished little changed. The XAU and GDX had slight fractional moves one way or the other on very light volume. Mentally I'm feeling a bit better but not all the way back yet from having a cold. I'm trying not to let yesterdays failed attempt at the SPY calls bother me too much. The basic idea was a correct one and that is a plus. If I am reading things here correctly, then I think we've got more room to go higher in the February option cycle. I can make a case for higher prices into the close on the upcoming Wednesday of next week. However after that, I'm not so sure. So for the short term the plan is to buy on weakness if we get any Monday and then sell out by the close on Wednesday. The market rarely cooperates though. I'll be taking a look at GE over the weekend as well. Perhaps the March calls will be the play. Plenty to ponder in the next couple of days. Asia was mixed and Europe slightly higher overnight. For now it's Friday afternoon and time for a rest.