Thursday, July 13, 2017
A drift higher today as the Dow rose 20 points on light volume. The advance/declines were slightly positive. The summation index is trending higher. The overall market was stronger than the Dow. The volume is so light here at all time highs for the Dow that I have to believe that the market will head lower in the near future. And sooner rather than later hopefully for my SPY July puts. I did think that today was the ideal time to buy and I purchased some other SPY July puts at a higher strike price. This is a risky venture to say the least as the market could simply stay overbought and drift higher. But without something to provide a push higher, I have to think that a pullback is coming soon. We'll see. GE was up almost 1/4 but the volume was lighter. Gold was slightly lower on the futures as the US dollar was little changed. The XAU fell 1 1/8, while GDX dropped 1/4. Volume was light. Mentally I'm feeling OK. I'm breaking one of the rules here as I am chasing a losing position with more capital. I'm now holding the SPY July puts at two different strike prices. Both are showing losses with the lower strike price having the bigger loss. I'm not sure if I want to hold this over the weekend or not. I'll have to let tomorrows price action determine that most likely. We're short term overbought but we could get more overbought. With 6 days to go in the July option cycle there is time for this trade to work. However as time goes by the premiums get smaller and that doesn't help the situation. The trading is never easy. Europe and Asia were generally higher overnight. We'll close out the week tomorrow.