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.