Friday, April 28, 2017
Some selling to close out the month of April as the Dow fell 40 points on average volume. the advance/declines were negative. The summation index is still moving up. GDP was just a bit light of expectations. We did open higher and close lower once again. I don't think that we're running out of steam here, just moving sideways after the huge run up. I did cancel my open order for the SPY May calls to get out before the weekend. I'll be placing that trade again next week. I still expect a break higher to new all time highs sooner rather than later. GE was lower by a dime but the volume was pretty light. Gold was up a few bucks and the US dollar was a bit lower but did come off of its lows for the session. The XAU added 2 points, while GDX gained 3/8. Volume was average. Mentally I'm feeling OK. Short term overbought for all the major stock indices with the exception of the TRAN. RUT had a weak session but we'll have to see if that was just the end of the month squaring. The small stocks continue to lead the way but perhaps they need a sideways rest as well. May sometimes isn't the best month for stocks, so I'll have to tread carefully if I do attempt a trade for the SPY calls. I'd prefer to see weakness in the beginning of the week and that would set me up for a long trade. But as you know the market rarely cooperates. I'm in a better mental state of mind now so perhaps I'll be able to make the proper decisions. Plenty of work to do over the weekend to be ready for a fresh trading week. For now it's Friday afternoon and time for a rest.
Thursday, April 27, 2017
A day of hanging around as the Dow rose 6 points on pretty good volume. The advance/declines were even. The summation index is moving up. The McClellan oscillator did give a signal yesterday for a big move in the next couple of sessions, so we will have to wait and see what happens tomorrow. Perhaps the market will move on the GDP report. I'm still looking for new all time highs in the Dow and S&P 500 before expiration. I adjusted the open order that I have for the SPY May calls. I think that next week around Wednesday would probably be the ideal time to enter this trade if the market cooperates. But if it gets filled before that, I still think that it will work. We've got the end of the month tomorrow as well. GE dropped around 20 cents again on good volume. The lack of upside for GE would normally be a problem for the market but it has been ignoring this so far. It is something to keep an eye on. Gold was little changed on the day and the US dollar was a bit higher. The XAU shed 2 1/4 and GDX lost almost 1/2. Volume was good. Mentally I'm feeling OK. Still short term overbought on the technical indicators for the S&P and it is touching the upper Bollinger band. However in rallies we can stay overbought for quite some time. That is what I think we are seeing here. The best case scenario from here would be a sideways consolidation into the middle of next week and then another leg higher. That would let some time premium get sucked out of the SPY May options and perhaps give me the opportunity to take a position. The small stocks remain strong here and that is a positive going forward. Asia was mixed and Europe lower overnight. We'll close out the week and the month tomorrow.
Wednesday, April 26, 2017
A one day reversal to the downside as we opened higher and closed lower. Perhaps it was a sell on the news of the Trump tax plan. The plan is actually only an outline and we don't really know what will pass in Congress to become law. The Dow fell 21 points on heavy volume. The advance/declines were positive. The summation index continues higher. Certainly a pause is due after climbing 450 points in just two sessions. Not to mention that we have arrived at the overhead resistance of the previous all time highs for the Dow and the S&P. So some hesitation here isn't the end of the world. I did place an open order for some SPY May calls and I'm leaving it in overnight. It's my belief that this rally has plenty more to go on the upside and that new all time highs are coming. GE lost about 20 cents on heavy volume. GE is oversold on the short term technical indicators but hasn't participated in the rally since the beginning of December. Gold was slightly higher as was the US dollar. The XAU was up almost a point, while GDX barely moved. Volume was good. The gold shares did come off of the lows for the session. Mentally I'm feeling OK. The VIX has dropped here as well and I do believe that will help support higher prices going forward. The small stocks continue to be leaders and that is a positive as well. Perhaps some backing and filling here and then a move to new all time highs. I will try and get some SPY May calls before we break out but the premiums are still high. Timing of this trade will be important once again as usual. I do think that this is one of those times where it will pay to chase the move higher. I could be wrong but I don't think so. We're short term overbought but will probably stay that way for a while as we move higher. Europe and Asia were both generally higher overnight. We'll keep an eye on the news tonight.
Tuesday, April 25, 2017
Up we go as the Dow roared ahead by 232 points on heavy volume. The advance/declines were 2 to 1 positive. the summation index is moving higher. We are on our way to new all time highs for the major indices in my opinion. I do think that you can just buy some index calls even though we're overbought. The market will most likely stay overbought as we trend higher. I'm thinking about placing an open order for some SPY calls tomorrow with a good until canceled stamp on the ticket. I would like to wait for a pullback but at this rate we won't see one. We'll get an outline of the Trump tax proposals tomorrow and that should provide more fuel for the rally. GE lost a dime on good volume. This stock certainly isn't participating in the rise. I'm not sure if that is a problem or not. Gold fell another dozen on the futures, with the dollar lower again as well. The XAU lost 3 and GDX dropped a point on very heavy volume. Poor earnings form ABX was the cause. Not to mention that the long term down trend line at $1300 turned down prices again for gold. We've entered the 5th year of the bear market for gold. Mentally I'm feeling OK. We closed above 6000 for the first time on the NASDAQ. RUT is trying to break out. The small stocks are leading the way and that is bullish. Plenty of time in the May option cycle for a call trade to still work despite the impressive run up of the past two sessions. Those are some of my thoughts on what is going on anyway. I haven't had a good handle on things lately but what we are seeing now looks a lot like the two run ups we've had after the US elections in November. The market took off each time and did not look back. I could be wrong but I still feel that calls will work for the May option cycle. Europe and Asia were both higher overnight but not as much as the US was today. We'll see what tomorrow brings.
Monday, April 24, 2017
Markets rallied around the world on the French election results. The Dow gained 216 points on good volume. the advance/declines were better than 2 to 1 positive. This should move the summation index higher. The S&P 500 has moved above the down trend line that has been in effect since the beginning of March on good volume. Any weakness can be bought in my humble opinion. The May option premiums are high though, with so much time left before expiration. But the trend should be higher from here. The VIX has moved way back down as well. The small stocks continue to act well. The NASDAQ is at a new all time high. We should see new highs in the S&P and the Dow off of this move. GE was flat on the session with heavy volume. Here's a stock that certainly did not participate in todays rally. Gold dropped as well as the fear factor was lifted for a day. The precious metal futures dropped a dozen despite a decent loss in the US dollar as well. The XAU fell 1 3/8, while GDX lost 3/8. Volume was good. We still need a high volume break to the upside at the $1300 level for gold to look constructive. Mentally I'm feeling OK. I'm really just considering to buy some SPY calls here just to get on board. Sometimes when the market gets going it just doesn't look back. We could be at one of those junctures right now. If the market likes Trumps tax plan on Wednesday, it could be off to the races again. Even if none of it actually comes to pass. The short term technical indicators for the major averages have turned up and have room to run higher. I'll check the SPY May option prices again tonight but they are rather pricey. But there will be no money made if you don't have a position. So we'll see. Asia was higher but Europe really took off to the upside last night. We'll see if we get any follow through and we should. I've just seen that Trump is proposing cutting the corporate tax rate to 15%. That is bullish for now but my guess is that it will probably be negotiated up from there. I really think that you need to be long here somehow. Stay tuned.
Friday, April 21, 2017
We finished off the week with a thud as the Dow fell 31 points on OK volume. The advance/declines were slightly negative. The summation index is moving sideways. We bounced around all day with the overall market a bit weaker than the Dow. We're still trying to make up our mind what to do here. The VIX may be trying to turn back up here and that would be a negative. My story remains the same. I don't have a good signal one way or the other. Plus my read of the market here lately has been wrong. I'm on the sidelines until I get a better idea of what to do. GE got clobbered today, off 3/4 on very heavy volume. So much for GE perhaps leading the way higher. The earnings were in line with estimates but the stock still got sold off. Gold and the US dollar were both up slightly. The XAU and GDX were little changed on average volume. Mentally I'm feeling OK. We are moving on to the May option cycle. The major stock indices are not in sync at the moment. The small stocks are still leading the way though and that is a plus. The short term technical indicators there are getting overbought. The big cap indicators are mid-range. The VIX could go either way here but has at least rolled over for now. With mixed signals like these, I will have to wait it out for now. Perhaps over the weekend I can find some clues on what to do. But for now it's the sidelines as the best choice for me. I've put aside the last debacle of a trade but I still need to see some type of signal before attempting the next one. At least that's the plan for now. The major foreign markets have been weak of late so maybe it's time for them to turn around after the French election on Sunday. That's just a guess as usual. Asia was a bit higher and Europe mixed in last nights trade. I'll be checking the charts over the next couple of days. For now it's Friday afternoon and time for a break.
Thursday, April 20, 2017
Up and down we go as the market is trying to figure out what to do here. The Dow gained 174 points on good volume. The advance/declines were over 2 to 1 positive. The summation index is still basically moving sideways but another day like today would change that. The small stocks are still acting good here so I'm still in the bullish camp going forward. I would like to purchase some SPY May calls at some point. Yes, I'm still looking for new all time highs if this is the beginning of the next leg up. That however, remains to be seen. GE was up 1/4 and volume was good. Perhaps the recent rise in GE is a clue as to where the overall market is headed. Gold and the US dollar both finished little changed for the day. The XAU and GDX had fractional gains on light volume. Mentally I'm feeling OK. Volatility has returned and that has increased the price of the option premiums for now. There is also plenty of time left in the May cycle as it really begins on Monday. The short term technical indicators for the S&P 500 are mid-range at the moment. I do not have any clear signals from my own indicators. So it's a time to wait. I'll let the expiration go by tomorrow and then assess the situation from there. Both Europe and Asia were positive last night. We'll finish up the trading week tomorrow.
Wednesday, April 19, 2017
Opening higher and closing lower as the Dow fell 118 points on average volume. The advance/declines were slightly negative. The overall market was once again stronger than the Dow, with the NASDAQ in positive territory. The summation index is trending sideways. As I've said before I can't quite make out what is going on here. However with the small stocks acting well, I don't think that we're on the verge of any major breakdown. I'm still looking at the May SPY calls. GE was up over 1/8 on average volume. No trades in mind here. Gold shed over $10 on the futures as the US dollar bounced back. The XAU lost 2 7/8, while GDX dropped 7/8. Volume was heavy. Gold is at some long term resistance here and a pullback isn't out of the question. If gold can get through the $1300 level on good volume the picture would turn very positive in my view. But that remains to be seen. Mentally I'm feeling OK. The big cap indices have been slowly trending lower since the start of March. I'm still thinking that this is simply a long consolidation before we attempt new all time highs again. There isn't much else to report. The Fed minutes came and went. The usual positive option expiration week bias didn't last. Perhaps the bounce on Tuesday was a chance to get short. But I have to believe that any decline will be short lived. The major indices are not in sync, therefore it appears to be more consolidation in my view. I'm going to wait for a clear signal and go from there. Asia was generally lower and Europe generally higher overnight. We'll keep an eye on overnight developments.
Tuesday, April 18, 2017
Back to the downside today as the Dow fell 113 points on light volume. The advance/declines were slightly negative. The summation index is now trending sideways. No follow through to yesterdays gains as the day began with a gap to the downside. The overall market was much stronger than the Dow so I'm still in the bullish camp for now. But I have to admit that I do not have a good idea of what is going on here. The sidelines seem to be the safest place for me at the moment. The RUT is holding up for now above the 1340 level. As long as that holds, I'm still going to look for higher prices going forward. GE was up 20 cents on average volume. Gold was flat on the day despite the US dollar getting crushed. The XAU and GDX had slight fractional losses on average volume. The lack of movement in gold and the gold shares isn't positive with the drop in the dollar. We should have seen some gains for the precious metal. Mentally I'm again feeling a bit tired. The short term technical indicators for the major averages are oversold but not completely. We do have the Bollinger bands converging which implies a big move one way or the other coming up. My thinking is that the sideways price activity that we've seen for the past month and a half is a consolidation before we head higher. If not we have built a pretty good top and prices should fall quickly. The recent action in the VIX indicators points to a rally coming. However as always, the market goes where it wants. We could turn those indicators around and the market could fall but the odds favor the opposite. We've got the Fed minutes tomorrow and that could be a market mover. It's also earnings season and anything goes there. It's a time to pay attention perhaps a bit more than usual. But like I said, I don't have a clear idea of what's going on. Asia was mixed with Europe lower once again. Europe could be moving in anticipation of the French election coming this weekend. That's a guess as usual. We'll see what tomorrow brings.
Monday, April 17, 2017
We had a gap to the upside to start the day and the market never looked back. The Dow gained 183 points on pretty light volume. The advance/declines were 3 to 1 positive. This should move the summation index back to the upside. After Fridays action we did have both short and medium term buy signals on a couple of my indicators. I did place an order for the SPY April calls this morning but there was no pullback and it wasn't filled. Today was the type of day I was looking for last week. But what can you do? It is frustrating sometimes though. The volume is light but I do believe that this is the beginning of something that will take us to new all time highs. I'll now look to the SPY May calls for the next trade. GE was up 8 cents and the volume was light. Gold lost a couple bucks on the futures and the US dollar finished a bit lower. The XAU and GDX were both little changed on light volume for the session. Mentally I'm feeling a bit tired, did not sleep well. Some buyers showed up today and I'm sure we saw some short covering as well. The VIX got to the overbought level where reversals take place. We saw all of that today. It's also options expiration week and the positive bias should be in effect. Declines can be purchased in my opinion. The only thing that would change my mind is if we're down tomorrow as much as we went up today. I do not expect that to happen despite the light volume today. I always say that light volume rallies cannot be trusted. So we'll see how it goes tomorrow. After last weeks debacle of a trade, I'm trying to stay positive and on an even keel. We'll see how that goes. Asia was mixed and Europe lower overnight. We'll keep an eye out on the developments tonight.
Thursday, April 13, 2017
The market continues to drop here as the Dow fell 138 points on light volume. The advance/declines were 2 to 1 negative. This should turn the summation index lower. I'm not sure what is going on here. I now have solid buy signals on a couple of my indicators. However the market has the feel of wanting to fall apart here. We are however, not in a crash zone on the summation index. My weekly SPY April call trade was a 100% loser. That is ridiculous. I was so certain that we'd see some upside that I never even put in a stop loss order. Unacceptable. Not to mention that the entry was wrong and we are in a holiday week. I don't know what I was thinking but it was all wrong. Today I actually placed another order for the SPY April calls but later canceled it. Some of my technical indicators are in the buy zone both short and medium term. But I really have to think about what is going on here and I do not want to make a trade to just try and make back what I just lost. I'll consider what to do over the weekend. GE was off 20 cents and the volume was light. The daily technical indicators have rolled over here. Gold was up over $10 on the futures and the US dollar was a bit lower but came up from the lows of the day. It appears like a flight to safety is in order as the US has just dropped some kind of huge bomb on Afghanistan. But the gold shares were quiet as the XAU and GDX finished the session little changed on average volume. Mentally I'm feeling OK. Interesting markets as it looks like we are about to drop below the support of a trading range that has been in effect for weeks on some of the major indices. Some of the technical indicators are not completely oversold so there is a chance that we are going to see some extended decline after a bounce. That's my guess at the moment but my take on things here is shaky at best.. My own indicators indicate that upside is due. The VIX indicators are in the area where at least a bounce is seen. I will really have to consider getting long on weakness Monday morning. However my confidence isn't exactly in a good place after the last trade. I also don't want to compound the recent loss with another negative trade. But it does look like an opportunity here for me, if I can manage it properly. That remains to be seen. It seems like there just were not any buyers this week, for whatever reasons. Geo-political concerns are in the forefront as well. I'll have to go over the charts this weekend and try and decide what to do. Also the sooner I put the losing trade behind me, the better my mind will be at trying to figure out where to go next. The game is never easy and the battle with myself never ends. Asia was mostly lower and Europe was red across the board. Plenty to ponder in the next 3 days. For now it's Thursday afternoon and a long weekend break is upon us.
Wednesday, April 12, 2017
Heading lower as the Dow fell 59 points on light volume. The advance/declines were 2 to 1 negative. The summation index is moving up but prices are not. I don't know what to make of that. My weekly SPY April calls are dead. The upside I expected never materialized and is long overdue. I will try and sell these tomorrow if possible if we get a pop at the open. But they will be 90% or more losers. Bad entry and trying the weekly options again was the wrong idea. I should have cut the loss right away but expected at least some upside this week. It never happened. My read on things here is wrong and I'll have to return to the sidelines I suppose. I still think that yesterdays low should be some type of bottom here. GE was off 1/4 and volume picked up a little going lower. Gold was up a bit again on the futures as the US dollar fell almost 1/2. The XAU and GDX had slight fractional gains on average volume. Mentally I'm feeling OK. Way overdue for some type of bounce here in my opinion. I'm not saying that it would be the start of another leg up but we are at a point where at least some upside should have occurred. But as usual the market goes where it wants. Light volume and no interest is not the best trading environment. The buyers have disappeared. After yesterdays comeback to almost unchanged, I expected some follow through to the upside. It didn't happen. My management of this trade has been awful. It's a step backwards really. If I had some more confidence, I would purchase some SPY April calls that expire next Friday. But the prudent thing for me to do here is sit things out until the next valid signal comes around. The SPY trade that I did this week did not fit those parameters. I think it was more of a case of me wanting to do something rather than wait for a decent set up. That's on me. The toughest battle for me in the game is always against myself. So where do we go from here? The VIX is overbought and at levels where we should see some type of move higher in equity prices. The short term technical indicators for the S&P 500 have rolled over. They are not oversold at the moment. So it is a mixed picture at best. With the lack of participation lately, sitting out for a while is the course that I will probably take. I'll book the loss tomorrow and then try to collect my thoughts over the long weekend. Asia was mixed and Europe generally lower last night. We'll finish up the trading week tomorrow.
Tuesday, April 11, 2017
Volatility returns but the Dow made yet another comeback. The most watched index was off almost 150 points in the morning and finished the day with a loss of 6 points on light volume. The advance/declines were positive. The overall market was weaker than the Dow. The summation index is still moving higher but prices are not. My weekly SPY April calls are in the red with only 2 days to go. It is a cut the loss trade at this point. I still expect some strength here in the next couple of sessions but it probably won't be enough to save this trade. This morning was the time to try the SPY April calls. Retrospect is always on time. The VIX shot up to its highest level this year today. GE was up a few cents and the volume remains light. Gold found a bid as the futures rallied over $20. The US dollar was lower. The XAU jumped 2 1/3, while GDX gained 3/4. Volume was good to the upside. Lower yields combined with geo-political tensions were the main drivers. I'm not sure how long that will last. Mentally I'm feeling OK. I'm once again not exactly sure of what to make of the good breadth without the corresponding upward move in price. The RUT is acting well here and that is bullish in my book. However the light volume remains a concern but that may be due to a holiday week and spring break. That also could be the reason for the pick up in volatility but that's a guess as usual. The upside that I was looking for is overdue so I expect a positive day either tomorrow or Thursday. I'd be very surprised if we simply continued lower. But I also have to admit that my take on things here isn't exactly clear. I'm also wondering if I simply put on this SPY trade because I wanted to do something before the expiration. The signal wasn't exactly the best. It doesn't matter now as I have to get out of this trade now with the least possible damage. Europe and Asia were generally lower. We'll see if we get some kind of bounce in the US trading on Wednesday.
Monday, April 10, 2017
The Dow bounced around today and finished with a gain of a little more than a point on very light volume. The advance/declines were 2 to 1 positive. The summation index is grinding higher. We opened to the upside and then gave it all back and then some. Rallied good again and lost it all into the close. I had an open order in for the weekly SPY calls this morning and it was filled on the first drop of the session. The entry was not good. When I realized that the drop was going to be more than I expected it was too late. This is a very risky trade that lasts until the close on Thursday. It is showing a loss and I will be lucky to get out with any type of gain. That said, my work does show that there will be upside this week. However it may be too late to save this trade. GE lost a couple cents and the volume remains very light. Gold lost a buck or so on the futures despite a lower US dollar. The XAU and GDX had slight fractional gains on light volume. Mentally I'm feeling a bit tired. Good breadth today with no gain and that could be a problem. The lack of volume isn't helping matters for the bulls either. Volatility has returned for todays session. I'm in the next trade now and it really isn't the best set of circumstances. The technical indicators remain mid-range and the basically sideways market price action continues. I don't expect a major decline to start here. If my entry would have been decent then this trade would be in a better position for success. But we will have to go from here and work with what we've got. Not a lot of economic data due with retail sales the most important for the week in my view. However that will be released on Friday and the markets will be closed. I'd like to hold this trade until Thursday but we will have to simply see what happens. Asia was mixed and Europe lower in last nights trade. We'll see how it goes tomorrow.
Friday, April 07, 2017
Plenty of pre-market drama but when it was all said and done it was a day of market drift. The Dow fell 6 points on light volume. The advance/declines were slightly negative. The summation index is barely moving higher. We had the US bombing Syria overnight and then a weaker than expected jobs report. However the expected volatility never happened as we traded in a small range all day. We now have geo-political risk to contend with along with the usual market risks. So it definitely makes for even tougher trading as headline risk has returned. The technical indicators are not even moving as they remain mid-range. I did place another order for the SPY April calls but it wasn't filled. I suppose I'll try again on Monday depending on how things look over the weekend. GE was up a few cents on very light volume. Gold rallied early on but then gave it all back and then some. The futures finished up 3 bucks but were much higher than that. The US dollar rose. The XAU and GDX came off their highs for slight losses. Volume was average. Hard to figure exactly what was going on there. Mentally I'm feeling tired. The market is trending sideways for now and that isn't a good sign for trading options. The light volume also is a factor. It implies a lack of interest as we are now in an aimless drift. 2 weeks to go in the April option cycle and I would like to try something. But we have a lot of premium left in option prices for the April cycle. As the days go by more time and volatility premium gets sucked out of the options and we have no real volatility at the moment. The one day reversal lower that we had this week juiced up the volatility premium and now that is being frittered away with each passing day. So the game gets tougher to put something profitable together. I'm still in the bullish camp but that could change in a hurry with headline risk. The employment report did not have its usual effect on the market today as traders simply pulled back on doing anything after last night. Perhaps I'll have to skip the April option cycle but that remains to be seen. I'll check all the charts in the next 2 days and try to come up with a definite plan for next week. It will be a short week due to a holiday on Friday. Plenty to think about. For now it's Friday afternoon and time for a rest.
Thursday, April 06, 2017
The Dow managed a 14 point gain today on light volume. The advance/declines were 3 to 1 positive though and that should turn the summation index back up. The overall market was stronger than the Dow and that is a plus. I did place an order for the SPY April calls but it wasn't filled. I might try this again tomorrow but we'll have to wait and see. The RUT held up well today and if we can get leadership there, the market should be OK. All eyes will be on the employment report but as always the markets reaction to the numbers is the key. I still believe that we're going to go higher before the April expiration but there really isn't a clear signal technically. GE was off a few cents on light volume. Gold rose $5 on the futures and the US dollar was a bit higher as well. The XAU and GDX were barely changed on pretty light volume. It's been quiet lately for gold and the gold shares. Mentally I'm feeling tired. Trying to put a trade on here has kept me busy. I almost wanted to chase things again today when we were up a point on the SPY but I didn't. There is still a lot of time premium left in the April options. Plus some extra volatility premium in there after yesterday. So the entry timing has got to be spot on for any trade to have a chance. Those premiums will get sucked out rather quickly as the next couple of weeks go by. We're still only mid-range on the short term indicators. However todays very positive advance/declines tells me we are probably headed higher. That's my guess at the moment. I'll wait and see how the market opens tomorrow and decide what to do from there. Perhaps I'll get a chance for the April calls. We'll see. Asia was lower and Europe generally higher last night. We'll finish out the week tomorrow.
Wednesday, April 05, 2017
It was a one day reversal to the downside as the Dow had an upside gap open and then closed lower for the day. The most watched index fell 41 points on good volume. The advance/declines were almost 2 to 1 negative. This will halt the rise in the summation index but I don't think it's turned lower yet. The overall market was weaker than the Dow and that is a warning sign. I think that if the RUT breaks and closes below 1340 that the tone and the trend will turn negative. The Dow could not hold an almost 200 point gain from early in the session. I have no explanation but the excuse is the Fed minutes release. I did cancel my open order for the SPY April calls but I really almost chased the rally today. I wanted to simply put in another order because I thought that this was the rise that will take us to new all time highs by expiration. But I didn't and now I have to reevaluate whether my positive hypothesis for prices is valid. GE was off a nickel but was much higher during the session. Volume was light. Gold was flat on the day and came off of its lows. The US dollar was flat as well but came off of its highs. The XAU and GDX were little changed on OK volume. Mentally I'm feeling OK. So now we have to decide if today was a one day wonder or the start of something real to the downside. The volume was legitimate so it really makes me wonder. Not to mention that the small stocks are leading the way lower and that is bearish. The short term technical indicators remain mid-range even with todays price action for the S&P. So we still are in a zone where it could go either way. If we get some good downside follow through tomorrow, then I think the market will be in trouble. As I stated earlier keep an eye on RUT. It led the way up and now has been moving sideways for 4 months. If it breaks down I believe the overall market will follow. But it hasn't happened yet. I'd still like to think that we're going to head higher. April is usually a seasonally strong month. So we'll see. I'll have to look at the charts tonight and decide whether I'm going to try the SPY April calls again. Plus we have the employment report out on Friday and now that certainly will be a market mover. So there is a lot to think about tonight. Asia was higher and Europe mixed in last nights trade. We'll see how the foreign markets react tonight to todays turnaround in the US.
Tuesday, April 04, 2017
It seems like a drift here as the Dow gained 39 points on light volume. The advance/declines were even. The summation index continues to the upside. I do have an open order in for the SPY April calls but at this rate it won't get filled. Unknown exactly which way we'll go here but I am still leaning towards a bullish resolution. However I do not want to chase anything here. If we get some downside ahead of Friday, I'll try the calls. If not I'll have to wait for the next signal. With 2 1/2 weeks to go in the April option cycle, there is still time for a trade. GE was up 1/8 on light volume. The gold futures rose $4 and the US dollar was little changed. The XAU was up a buck, while GDX added 1/4. Volume was light. Mentally I'm feeling OK. The short term technical indicators for the S&P here are about mid-range. Hence the opportunity for the trend to go either way. We also sometimes just get a sideways market in the month of April and that could be the case as well. The economic data out so far this week has been in line with estimates. We'll get the Fed minutes tomorrow and perhaps that will get things going. But we also could simply be on hold until Fridays jobs report. Once again I don't want to press or chase things here but I do have the feeling that we are going to take a run at new all time highs. The overall market is still a bit weaker than the Dow at the moment and that needs to change if we're going to go higher. Asia was mixed and Europe positive in overnight trade. We'll see what tomorrow brings.
Monday, April 03, 2017
We begin the week and the month of April a bit lower as the Dow fell 13 points on average volume. the advance/declines were negative. It could have been worse as we were off almost 150 during the session. This Monday looks a lot like last Monday. The summation index is still moving up. No clear signal here but I did place an open order for the SPY April calls and I'm leaving it in overnight. I would like to be long before the employment report due Friday. However there is a chance that today was the time to purchase the calls. The ideal scenario from here in my mind would be a drift lower all week into the close on Thursday. The market rarely cooperates. GE was up a few cents on average volume. Gold rose a few bucks on the futures and the US dollar was a bit higher as well. The XAU rose 1 1/2, while GDX gained 1/3. Volume was nothing special. Mentally I'm feeling OK. Somewhat of a change from the recent behavior as the Dow had better relative performance. The small stocks under performed today and that is something to keep an eye on. I'm leaving in the open option order for the calls overnight but if we open down hard again, I'll cancel it. As I said before, drifting lower for the rest of this week would be the preferred market motion to set up this trade. So if we can stay in a holding pattern until Friday, there might be a chance for this trade. If not we'll just have to remain patient and see how things play out. That's all we can do for now. Asia was up and Europe down in last nights trade. We keep an eye on things overnight.