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.