The Dow was off a bit but the overall market soared higher.  The most watched index dropped 15 points on very heavy end of the month volume.  The advance/declines were 2 to 1 positive.  The summation index is moving up.  The S&P 500 was up over 20 and the NASDAQ gained close to 100.  It appears that the S&P is breaking through the down trend line on good volume.  That would be bullish and it appears that is the case.  Overbought and staying that way in the rally.  After the bell Amazon reported good earnings so it looks like we'll go even higher tomorrow.  But we do have the jobs report to contend with but it may simply be a non event in this ride.  I did purchase some SPY February puts today.  SPY got to the level of 270 that I was looking for.  The VIX also made it down to the 16.5 level and its 200 day moving average.  So this would be the area for the VIX to bounce if what I'm looking for is correct.  If not, we'll move higher and the put trade will be a loss.  It's looking like that's the case at the moment.  If so I'll take the loss and move on.  GE rallied on the earnings report today and rose a little over a buck on extremely heavy volume.  Gold moved higher again as well with the futures up almost $10.  The US dollar had a slight gain.  The XAU rose 1 3/4, while GDX added 1/2.  Volume was good.  Overbought and staying that way for the gold shares as well.  Obviously I should have held on at least another day on the GDX call trade.  Money left on the table there and it looks like the rally will continue.  There is plenty of overhead resistance here for the gold shares but we are cutting right through it at the moment.  Mentally I'm feeling OK.  Not much news coming out of the US/China talks the past couple of days.  We'll see if we get anything overnight.  It looks like the past week or so was a consolidation flag for the S&P as we have broken out above it on good volume.  The 200 day moving average would be the next logical area of resistance at 2740 for the S&P and around 272 on the SPY.  At the rate that we're going we'll get there tomorrow.  I'll keep an eye on the overnight headlines but it looks like I'll get stopped out of the SPY February put trade tomorrow morning.  Europe and Asia followed the US higher overnight.  We'll see what the jobs report has to say and finish out the trading week tomorrow.

The market powered higher today after the dovish Fed speak as the Dow climbed 435 points on good volume.  The advance/declines were almost 4 to 1 positive.  The summation index is heading up.  Overbought and staying that way for the major stock indices.  The SPY is about to break its down trend line that began last October.  However there is still plenty of overhead resistance, including the 200 day moving average at 271.  I'm still inclined to try the SPY February puts here if we continue higher near term.  We have been overbought for quite a length of time.  The VIX is practically within a point of the 16.5 level that is my signal to short.  Now of course I could be wrong here because if we get some good news out of the US/China talks the market should take off again.  I'll consider what to do this evening and go from there.  GE was up twenty cents on good volume.  Earnings tomorrow will dictate the near term there.  Gold rallied on the Fed with the futures gaining ten bucks.  The US dollar was lower.  The XAU was up a point and GDX added 1/4.  Volume was good as money continues to make its way into the gold shares.  Short term overbought here but it could stay that way.  We did finish off of the best levels here.  I sold my GDX February calls.  I didn't get the best price of the session as GDX climbed to 22.5.  I did manage a nice gain of over 400% though for the trade.  My fear is that I've sold too early because there is still over two weeks to go in the February option cycle.  But at least it was a winner for a change and I certainly needed that.  Mentally I'm feeling OK.  Everything is now looking up for the market with the Fed out of the way.  Of course that could all change with tomorrows headlines but right now it feels like there's another leg up here for stocks.  It still looks like we've had a V shape recovery in prices and there will be no retest of the lows.  The Dow is poised to break above its 200 day moving average tomorrow.  Perhaps the SPY puts are the wrong idea here but if the VIX gets to 16.5 I'm giving them a shot.  I'll also be keeping an eye on the GDX because it looks like the rally there is for real.  Waiting for the next oversold level to trade long there again.  Europe was generally higher and Asia mixed overnight.  I would expect to see the foreign markets rally on the heels of the US.  We'll see if there are any developments form the China/US talks overnight. 

A mixed bag today as the Dow rose 54 points on average volume.  The advance/declines were positive.  The summation index continues higher.  The overall market was weaker than the Dow led down by the NASDAQ.  The VIX was slightly higher today.  Waiting on the Fed I guess but I don't expect any surprises there.  I could be wrong.  Two days of US/China talks begin tomorrow.  I'm still leaning towards the SPY February puts but I'm not in a rush to buy them.  GE lost a few cents on good volume.  Gold was up $7 on the futures while the US dollar was just a touch higher.  Gold is clearly now above the 1300 level.  The XAU added 1 7/8 and GDX rose 1/2.  Volume picked up a bit.  Clearly short term overbought for the gold shares now.  However in rallies the short term condition remains as the stocks move higher.  Is that what we are about to see here?  My GDX February calls are solidly in the black with a nice profit.  Perhaps I should simply take it here.  We are at the near term resistance level of 22.  Something to consider overnight.  Mentally I'm feeling OK.  Lots of news and announcements for the rest of the week for the market to digest.  I suppose what I'd really like to do is wait for the VIX to get to 16.5 and then get the SPY puts.  Not sure if I have the patience or discipline to do that but I should.  The NASDAQ daily indicators have clearly rolled over but the other indices including RUT not so much.  I guess I'll wait for one more push to the upside for stocks and look foe the SPY puts there.  If stocks just drop from here I at least have the GDX trade to fall back on.  Never easy in this game.  Asia was lower and Europe higher in last nights trading.  We'll see what the Fed has to say tomorrow and keep an eye on the market reaction.

We began the week with a thud as the Dow fell 209 points on average volume.  The advance/declines were negative.  The summation index is still moving up.  Earnings disappointments were the reason for today fall but there's a lot on the plate this week.  We've got the Fed, US/China talks, the jobs report and long awaited other economic data coming out.  It should be quite a week going either way.  We're still short term overbought but the short term technical indicators for the major stock averages are starting to roll over.  I did place an overnight order for the SPY February puts but it wasn't filled.  Might try again tomorrow.  GE lost about 1/4 on good volume.  We've been going sideways since the run up from the lows.  Hopefully it's a bullish flag formation.  Earnings due on Thursday.  Gold and the US dollar were both flat today.  The XAU and GDX had fractional gains on average volume.  My GDX February calls are doing nicely so far.  Getting short term overbought here though.  Plus we're at resistance of 21.5 for GDX.  Mentally I'm feeling tired.  I'd still like to see a run up to around 270 on SPY before getting short.  The market may not cooperate though.  The VIX spiked up today but did finish below its highest intra-day levels.  Would love to see it get to 16.5 but this may not occur either.  I'm trying to remain patient for now because it is such a huge week for data and announcements.  Markets could swing big in either direction.  For now I'll keep an eye on things and see how it goes.  Europe and Asia were lower overnight.  We'll see what tomorrow brings.

Back to upside for the Dow on the hopes that the US government stalemate is over.  The most watched index rose 184 points on average volume.  The advance/declines were 3 to 1 positive.  The summation index continues to move higher.  Getting closer to the resistance at 270 for the SPY and closer to the VIX level of 16.5 which is my threshold to get short.  Now this may not be the right idea but technically it is where you take a shot.  We'll see if we get there next week.  GE was up over 1/3 on good volume.  Earnings due here next week so we should see some movement then.  Which way is the question as always.  Gold had a stellar day as the futures jumped over twenty dollars.  The US dollar got slammed.  The XAU gained 2 1/2, while GDX rose 2/3.  Volume was slightly above average.  My GDX February calls are in the black.  If GDX can get through 21.5, I'm guessing we'll make it to 22.  Mentally I'm feeling OK.  We've got the Fed next week but it's assumed there won't be any surprises coming there.  Economic data could start to be released if the government reopens as anticipated.  Supposedly a three week reopening has been agreed to.  But in this day and age, I'll believe it when I see it.  There's also some US/China tariff meetings scheduled for next week as well.  So there will be plenty to watch but most of all I'll keep an eye on the technical indicators and see if they reach the action points.  However I will certainly be double checking my work over the weekend.  We are still short term overbought on the major stock indices.  Gold and the gold shares however have moved up from being oversold.  Not overbought here yet but heading in that direction.  It looks like the GDX February call trade could work but we all know that market goes where it wants.  Gold did close above the 1300 level on the futures and that's a plus for the bulls.  Resistance comes in at 1320.  Plenty of charts to go over this weekend to get ready to close out the month.  Europe and Asia moved higher with the exception of England again.  It's Friday afternoon and time for a break.

More back and forth today as the Dow fell 22 points on about average volume.  The advance/declines were 2 to 1 positive.  The summation index is moving up.  The overall market was stronger than the Dow.  We're still short term overbought for the S&P 500.  Nothing has really changed.  I'm waiting for 270 on the SPY in order to try the puts there.  Perhaps we can get there at some point next week.  We're still waiting for some kind of settlement to reopen the US government and the market reaction to that.  Should be positive and we'll go from there.  No economic reports until the government gets back to work.  GE gained a nickel on good volume.  Gold was flat but the US dollar was higher.  The XAU was off a touch and GDX was flat.  Volume was light.  No interest in gold here one way or the other.  The gold shares remain oversold so I'll continue to hold on to the GDX February call trade.  Mentally I'm feeling OK.  A short holiday week and we'll finish it out tomorrow.  Still a lot of earnings to come out.  We're still at the mercy of the latest China/US trade talk story.  Plus the US government shutdown soap opera.  I still favor some downside at resistance because there is a lot of it right above where we are.  Patient for now.  Gold is holding the 1280 level but a break there would be negative as there is no support until around 1260.  We'll see how it goes.  Asia was higher as was Europe with the exception of the FTSE.  We'll close out the week tomorrow.

Back to the upside for the Dow as it gained 171 points on lighter volume.  The advance/declines were barely negative.  The summation index continues higher.  The overall market was much weaker than the Dow as the advance/declines suggest.  A weak volume rally up to around 270 on the SPY would be the ideal scenario for getting short here.  I'm not sure that will exactly happen but we can hope.  The VIX moved back down today and if it gets to 16.5, that's the signal to get the puts as well.  It is simply a matter of waiting and checking which options to buy if and when we get there.  GE was up a few cents on average volume.  Gold fell a buck and the US dollar was a bit lower as well.  The XAU and GDX had very minor fractional gains on very light volume.  My open order for the GDX February calls was filled so I'm in the next trade.  It is showing a tiny profit.  Mentally I'm feeling OK.  The market moved back and forth today as it tries to make up its mind where to go next.  Still plenty of earnings to come and the eventual resolution of the US government shutdown.  I'll still be looking for small run up to 270 on the SPY and then go from there.  We could also stall right here and roll over as well.  If that's the case then it will be too late for me to get short.  There's also the chance that the market just keeps going higher here as well but that isn't the outcome that I'm favoring at the moment.  GDX and gold are both oversold here but as we all know, anything can happen in this game.  Europe and Asia were slightly lower last night.  We'll keep an eye on the headlines tomorrow.

A negative start to the trading week as the Dow fell 301 points on good volume.  The advance/declines were a little over 3 to 1 negative.  The summation index continues higher.  Volatility returned today but it doesn't mean that this is the beginning of some protracted downturn.  It could be but we don't know yet.  Many times the trading day after expiration is the reverse of the price action on expiration.  We'll have to see how the rest of the week progresses.  Of course today was the kind of price action I was expecting last week but the market simply didn't cooperate.  If we get back to the 270 level on the SPY, I'll try the February puts.  GE lost forty cents on good volume.  Gold was up a bit and the US dollar was little changed.  The XAU and GDX had slight fractional gains on average volume.  I did place an order for some GDX February calls as we have reached short term oversold here.  I'm leaving the order in overnight.  Not a lot of money involved here.  Mentally I'm feeling OK.  Selling today as what were hopes last week with regards to the Chine/US trade deal turned into fears over the weekend.  We're at the mercy of headline risk more so than usual until something concrete comes out of this mess.  SPY managed to bounce off of its 50 day moving average and that's a plus.  Still short term overbought here though.  I guess I'm hoping for a move near 270 and we'll see what happens from there.  It would be great to see the VIX make it back down to 16.5 but that looks like it's out of the question after today.  Plenty of time in the February option cycle.  Perhaps I'll wait for the US government shutdown to end and fade the rally off of that.  Many scenarios to deal with as we go forward here.  We'll see if we get any follow through selling tomorrow and take it from there.  Europe and Asia were lower last night.  We'll keep an eye on the trading activity tonight. 

Powering higher as the Dow gained 336 points on heavy volume.  The advance/declines were 3 to 1 positive.  The summation index is moving higher.  Perhaps today was what the McClellan oscillator was signaling.  Overhead resistance?  No problem as the S&P 500 is plowing ahead.  Next up, the declining tops line at the 2700 level.  It's only 30 points away.  That would be the logical spot to try the SPY puts again but I don't know if I want to step in front of this freight train.  The thaw in the US/China tariff war is the excuse for the rally.  The fact that it just happens to occur during options expiration week is just a coincidence.  Sure.  Overbought but we've been that way for days.  The VIX is making its way back to the 200 day moving average at 16.5.  That will be the moment of truth and I will try the SPY February puts there.  GE was off a bit on good volume.  Gold fell $11 and the US dollar was higher.  The XAU dropped 1 1/8, while GDX fell 1/3.  Volume was a bit above average.  No need for gold if the market continues to rally as the fear trades will unwind.  Mentally I'm feeling OK.  Not a good week for me as I booked a couple more losing trades.  In retrospect waiting expiration week out would have been a better idea.  But you go with what you know at the time.  The rally seems like it has no end.  If the US government shutdown ends, that would provide another reason to buy.  Right now it appears that the market is ignoring any bad news and there are no sellers.  A V bottom is in place and I don't know how much longer we can simply go straight up.  Usually it's longer than you think.  Europe and Asia were both higher as money is pouring back into stocks around the world.  I'll check the charts over the weekend but it looks at this point that the rally will never end.  We know better than that.  It's Friday afternoon and time for a break.    

Another day, another gain as the Dow rose 163 points on good volume.  the advance/declines were over 2 to 1 positive.  The summation index continues higher.  It was a one day reversal to the upside as we opened lower and closed higher.  My work indicating a decline today was wrong.  The expected decline did not materialize despite a down open.  The advance was fueled late in the session by a report the the trade tariffs with China were being lifted.  Of course it wasn't true but that didn't matter as the market took off.  I was stopped out of one of my SPY January put trades for a 40% loss.  I sold the other SPY January put trade for a 95% loss.  That trade should have had a stop loss order but did not and that's on me.  Halfway through the first month of the year and already the losses are mounting.  This is the longest losing streak of my trading life.  the market doesn't care though and you've got to keep moving on.  Overbought for days on end now as sellers have gone on vacation.  of course you can make a case for the upside maneuvering for the expiration tomorrow and you could have a valid argument.  The McClellan oscillator signaled for a big move in the next two days yesterday and today would qualify for that.  GE was up over 1/8 on better volume.  Gold dropped a couple bucks and the US dollar was flat.  The XAU and GDX were little changed on light volume.  Mentally I'm feeling OK.  RUT broke through its declining tops line today.  We'll see if there is some follow through going forward.  There is a case to be made for the S&P 500 in a 5 wave move up from the lows with this being the fifth and final wave higher.  However with the strength of the move higher here with a V bottom in place may indicate that up is the only path from here.  Certainly a resolution of the trade war with China will provide a stimulus to the upside as todays price action indicates.  The normal overbought and oversold indicators are not working right now.  So it is tough to trade out there on the technical indicators at least for me.  I may have to head to the sidelines for a while after todays trading debacle.  There was a chance early on for a profit in the most recent trade but I was too slow to take it.  The wiping out of the gain came quickly and the sharp rally on the supposed tariffs relief took care of the rest.  At least there was a stop loss order in place there.  I'll simply have to move on and try again.  Europe and Asia were generally lower.  We'll see how the expiration goes tomorrow.

The market climb continues as the Dow gained 141 points on good volume.  The advance/declines were positive.  The summation index continues higher.  Overbought and staying that way, which is a sign of strength.  My SPY January puts are dead.  However I do believe that tomorrow will be a down session according to my work.  So I purchased some other SPY January puts at a closer to the money strike price.  This is a one day trade for me as I will be out tomorrow regardless.  The risk is extreme since there are only two trading days left for this.  Now I could be simply completely wrong here.  The market can certainly drift higher in to the expiration.  With a positive expiration bias that's usually in place, a drift upwards can certainly happen.  But I've also got to believe in what I'm doing, so I gave this trade a shot.  It's showing a slight profit but tomorrow will tell the story.  GE was up 1/4 on what now passes as average volume.  Gold was up a bout five bucks and the US dollar was a bit higher.  The XAU and GDX were flat on very light volume.  Mentally I'm feeling OK.  The market remains resilient here as the bank earnings this week were not particularly good but those stocks have rallied anyway.  Perhaps the bad news was already priced in and the thought is that things will only get better from here.  Whatever the excuses, we cannot ignore the V shaped rally that has taken place.  We are in the overhead resistance at this point.  I can make a case to go a bit higher from here but I do believe that the declining tops line that is in place for the S&P 500 will be tough to overcome the first time around.  I would also keep an eye on the down trend line for RUT.  That index is usually a leader and it is right at that declining line.  If RUT would be able to break through here that would be entirely bullish for stocks going forward.  Hasn't happened yet but I'll be keeping an eye on it.  The Brexit drama out of England really hasn't been an issue for the US stock market.  Asia and Europe were generally higher overnight.  We'll see if the expected decline takes place tomorrow.

Back to the upside today as the Dow gained 155 points on average volume.  The advance/declines were almost 2 to 1 positive.  The summation index continues higher.  The overall market was much stronger than the Dow and that is a plus for the bulls.  We've also climbed back above the zero line in the summation index.  My SPY January puts are now in the red over 50%.  Only a sharp decline in the next couple of sessions will save this trade.  It is once again a cut the loss kind of deal.  We remain short term overbought for all the major stock indices.  I do expect weakness on Thursday but from what levels and how much?  I also could be wrong.  GE was off over 1/8 but the volume was lighter than is has been.  Gold lost a couple bucks as the US dollar was higher.  The XAU fell 1 3/4, while GDX dropped 1/3.  Volume was average.  Mentally I'm feeling OK.  Another losing trade in the works as the market did not follow through on yesterdays drop.  Good news from China and bank earnings conference calls are the reasons for the rise.  The S&P is trying to get through the overhead resistance here but I don't think it will be successful.  That said there is room to go higher up to the declining tops line that began in October of last year.  That will be the next spot to try some puts if we get that far.  I've got to say at this point it appears that we will.  That level is just below 2700.  3 days to go in the January option cycle.  I'm inclined to wait until Thursday to dump this trade but it may not matter if we continue to the upside tomorrow.  There's some Brexit news due out of England tonight but it is already in the market according to some.  More bank earnings on tap as well.  Europe and Asia were both higher in last nights trade.  We'll see what tomorrow brings.

Slight downside to start the week as the Dow fell 86 points on average volume.  The advance/declines were negative.  The summation index is moving higher.  We opened with a gap lower and then climbed back for most of the day until the final hour.  Short term overbought here for the market and some downside is expected but I certainly don't know how much.  I did take an elevated risk today by placing an open order for the SPY January puts.  It got filled later in the session.  With only 4 days left in this option cycle, you can see just how risky taking on a position is here.  It's showing a slight profit.  I'm not expecting a dramatic drop here but do think that weakness will show up it's just a matter of how much.  Today could be it for all I know.  GE was off a few cents and the volume was lighter than it has been.  GE is due for a rest and remains overbought.  Gold was up a couple bucks and the US dollar was a touch lower.  The XAU and GDX had fractional losses on light volume.  Mentally I'm feeling OK.  So I'm in the next trade now and it won't be one that lasts too long.  Out by Thursday at the latest and probably before then.  The VIX remains oversold while the major averages remain overbought.  This condition can persist but it already has.  I don't think that it will last all week but it could.  My entry price was what I wanted so I decided to take the chance.  Earnings are starting to trickle in and that should affect prices either way going forward.  Plus we're still not out of the woods with regards to some kind of headline appearing overnight out of nowhere.  But you could say that's always the case.  The technical indicators say we're in for a break here so I'll stick with that.  Could simply be sideways though.  The overall market was weaker than the Dow though.  Europe and Asia were lower overnight.  We'll see how it goes tomorrow.

A day of hanging around mostly as the Dow tried to sell off again but couldn't.  The most watched index fell 6 points on average volume.  The advance/declines were positive.  The summation index continues higher.  Overbought and staying there for the major stock indices.  Almost at resistance for the S&P.  I did place an order for some SPY January puts but it wasn't filled.  I'll go over this idea again on the weekend.  The VIX is getting down to the level where it has turned around but we aren't there yet.  I suppose the ideal scenario would for the VIX to get to 16 when we reach the declining tops line.  That could happen next week if we remain overbought but the market rarely sets up like you want it to.  The riskier play is trying the SPY January puts ahead of getting to the declining tops line.  Plenty to think about.  GE was flat on the session and the volume was lighter than it has been.  Gold was up slightly as was the US dollar.  The XAU and GDX had slight fractional moves on light volume.  Mentally I'm feeling OK.  Expiration week coming up with plenty of economic data due out if it comes.  The government shutdown could affect the flow of data.  The market is overbought.  The VIX is oversold and at its lowest point in weeks.  We are near or at overhead resistance for all the major averages.  The McClellan oscillator remains in the 300's, which it rarely reaches.  All signs really point to some kind of downside on tap next week.  I will go over the charts this weekend but I do think that if we see any strength on Monday it should be shorted.  That is what everything is telling me right now.  The question is whether it will be just a short drop for the market to catch its breath or something more towards the retest of the lows that we haven't seen.  Right now things look more like a V bottom to me but that could change.  As always there's plenty of questions without obvious answers in the game.  Plenty to ponder over the weekend.  Asia up and Europe down to end the week.  It's Friday afternoon and time for a break. 

The Dow keeps moving higher as the most watched index rose 122 points on good volume.  The advance/declines were positive.  The summation index is moving higher.  It was also a one day reversal to the upside as we opened lower and closed higher.  Short term overbought to be sure now but that condition can last in a rally.  I am looking at the SPY puts here for both January and February.  But the timing will have to be pretty good if I try the Januaries.  We are right at resistance of 2600 for the S&P.  It's possible that we get above there but I do think we are at the end of upside for now.  I should probably wait until we get to the 50 day moving average at 2635 but I don't think that we'll get there in the short term.  We'll see.  GE continues to the upside as it gained 3/8 on good volume.  Gold was off five bucks as the US dollar was higher.  The XAU lost 1 1/4, while GDX shed 1/3.  Volume was light.  Mentally I'm feeling OK.  The market is now resilient.  We've gone from a sell everything mode to an almost complete lack of sellers.  I am positive longer term for equities but I just can't see things going much higher from here with all the near term overhead resistance.  I do think that I'll let tomorrow pass since it's Friday and then check things out over the weekend.  Cutting it short on the blog today as I have other matters to attend to.  Europe and Asia were somewhat mixed.  We'll close out the week tomorrow. 

Another day another gain as the Dow rose 91 points on continued heavy volume.  The advance/declines were 2 to 1 positive.  The summation index is moving up.  The McClellan oscillator is above the +340 level.  This is a very rare occurrence and the only way it can go from here is down.  I did look at the SPY January puts today but did not buy any.  We are getting to the overhead resistance in the S&P at 2600.  You could make a case for 2650 but that it about it.  The February puts are very pricey still due to the recent volatility.  I might try the puts but haven't yet made up my mind.  I did finally sell the SPY January calls that I had for a 50% loss.  I can live with that.  They were a total wipe out at one point.  Poor entry there yielded poor results.  I'm moving on.  GE lost few cents and the volume was lighter than lately.  Gold found buyers again and was up $8.  The US dollar fell, which I'm sure helped gold.  The XAU added 1 1/3, while GDX rose 1/4.  Volume was light.  Sill overbought here.  Mentally I'm feeling OK.  Short term overbought for the S&P as well and we are in the vicinity of overhead resistance.  All signs point to some downside here but the timing as always will be the key.  The lack of sellers recently is a concern on going short here.  But I think if we get up to the 50 day moving average soon, I'll be trying the puts.  However it's possible that the market doesn't get that far.  One thing that I am fairly certain of is that we are not just going to break through the overhead resistance.  We have both a down trend line and sideways congestion pattern to get through on the S&P.  That will take some time and I certainly can't see the market breaking through on the first attempt.  I could be wrong but don't think that I am in this instance.  The key question here is when to try the SPY January puts before expiration next Friday.  I don't have that answer yet.  Europe and Asia were both higher as money is coming back into stocks worldwide.  We'll keep an eye on the overnight trading.

The market continues to climb as the Dow gained 256 points on heavy volume.  The advance/declines were better than 3 to 1 positive.  The summation index is trending higher at a good clip.  The McClellan oscillator is now over +300.  We are due for some kind of pause here because the upside momentum has reached an extreme.  That doesn't mean a collapse is imminent or that we can't go higher after a rest.  It does probably mean though that my SPY January calls will be losers with only eight days left in the January option cycle.  The US/China trade talks weren't a disaster and the market rallied.  We are getting earnings pre-announcement misses already.  That will put a damper on things going forward.  GE was off over 1/8 on pretty heavy volume.  It also had a one day reversal to the downside.  Gold was off a few bucks as the US dollar was higher.  The XAU and GDX closed little changed on very light volume.  Still overbought on the short term here.  Mentally I'm feeling OK.  Short term overbought and getting near some pretty good resistance of 2600 for the S&P.  Maybe we get another day of upside but the odds favor a pullback in the near term.  I really need to dump the SPY January calls that I have for a loss and move on.  Perhaps tomorrow on the open if we see some strength.  Probably should have done that today in retrospect.  The VIX is very oversold here as well and that means some downside is on the way.  How much is the question.  Can we squeeze out another day of gains here for the S&P?  That's another question that will be answered tomorrow.  The volume has been good here to the upside, so the rally is believable.  That does kind of make the case for a V bottom.  However I don't think that we'll get high enough to save my SPY January call trade.  We'll see.  Europe and Asia were both higher overnight.  We'll see what tomorrow brings. 

Some follow through to Fridays upside today as the Dow gained about 100 points on heavy volume.  The advance/declines were almost 4 to 1 positive.  The summation index is heading higher.  It has turned around and so has the market for now.  Getting short term overbought for the S&P but not all they way there just yet.  My SPY January calls are still solid losers and losing time and volatility value as the days go on.  We'll need to see at least a 500 point upside day for this to be a cut the loss scenario.  I doubt that will happen but you never know in todays environment.  The very high readings of the McClellan oscillator here say that the worst is over for the market.  Perhaps what we'll see is a V bottom instead of the retest that I was looking for.  Hard to say at this point.  GE continues upwards and gained 1/2 on very heavy volume.  Gold was up a few bucks as the US dollar was lower.  The XAU and GDX had fractional losses on light volume.  Overbought here for the gold shares.  Mentally I'm feeling OK.  Not a lot of economic data due out this week.  China and the US are having trade talks today and tomorrow.  Good or bad news from that could sway the market in either direction.  Headline risk remains in the forefront for now.  Of course there's always the earnings pre-announcements to deal with as well.  But we'll stick with the technical indicators.  Short term overbought for right now and if we stay that way the rally will continue.  If not, we'll have to see how far back down the market drops.  The overall market was stronger than the Dow today and the small stocks are acting well.  So perhaps there's a little more room to the upside in the near term.  Asia was higher last night but Europe was a touch lower as Brexit is still looming on the trading minds over there.  We'll keep an eye on the overnight developments and watch for news out of the China/US trade talks.

A run back to the upside to finish the week as the Dow roared higher by 746 points on heavy volume.  The advance/declines were almost 10 to 1 positive.  The summation index is heading up.  Volatility rules.  The jobs report was better than expected and the Fed said today what the market wanted to hear.  Of course something could happen over the weekend and we'll be right back down again.  That is the nature of the game we're playing right now.  My SPY January calls showed a little life today but they are solid losers.  We'll need more days like today and in a hurry to cut the loss here.  Doubtful.  The VIX is short term oversold now so going higher from here could be a problem.  We're probably still in snap back from the lows of December.  Although yesterday looked like it was a start of a retest, in reality it wasn't.  GE was up over 1/8 and the volume remains heavy.  Gold fell today around eight bucks.  The US dollar was a bit lower.  The XAU and GDX had fractional losses on good volume.  If we do get a pullback here the GDX calls could be the next trade.  Mentally I'm feeling OK.  It's an event driven market to be sure when you can go down 600 points one day and up 700 the next.  The technical indicators aren't much help when the market is being whipsawed around.  The short term indicators have turned back up but we'll see how long that lasts.  Two weeks to go in the January option cycle.  Should be interesting.  I guess my hope here is that another leg up is starting and perhaps we can make it to 2600 on the S&P.  However the McClellan oscillator should be very overbought after todays action and in need of a rest.  I'll go over the charts this weekend and try to figure out a game plan for next week.  I'm inclined to hold onto my SPY January call position for a while longer.  But the odds of it coming back from the dead again are not good.  It already happened once.  But if some good news comes out of nowhere again, who knows?  The market could be off to the races again.  One thing for sure is that you've got to pay attention.  Asia was mixed and Europe higher overnight.  It's Friday afternoon and time for a break.

The Dow got clobbered today on some bad news from AAPL.  The most watched index fell 660 points on good volume.  The advance/declines were only negative though.  The summation index is moving higher still.  On such a negative day like today the A/D line should have read at least 3 or 4 to 1 negative.  This implies that the decline will not have legs.  The internals of the summation index were negative and that came through for the bears today.  My SPY January calls are dead.  I did place a limit order to sell them but it won't get hit.  It will probably be a total loss to start the new year.  A carryover hangover from last year.  But really just another bad trade.  GE was flat on good volume.  Gold continues to shine as it rose a dozen.  Getting close to $1300.  The US dollar was lower.  The XAU added 1 1/4, while GDX gained 3/8.  Volume was light.  We are at some very heavy resistance for the gold shares.  I do not expect GDX to move much higher here without some backing and filling.  Mentally I'm feeling OK despite that fact that I'll be starting 2019 with a trading loss.  Perhaps today was the beginning of a retest of the most recent lows for the S&P.  The internals here say that it will hold.  If we get all the way back down to the 2350 level, that would be the spot to try the January calls again.  We'll see because it would be a counter trend trade.  The trend is down and that isn't going to change anytime soon.  AAPL's disappointment could be just the beginning.  The short term technical indicators for the S&P are now starting to roll over.  We'll simply have to wait and see how bad it gets.  The jobs report will be out tomorrow.  Regardless of what it says it will probably be viewed as negative.  Perhaps we'll get to the S&P closing 20% below the all time high for a bear market sooner rather than later.  I'll just have to wait to see how things go tomorrow, exit the losing SPY January call trade and look for the next idea.  Asia and Europe were down overnight.  We'll see if they follow the US lower tonight.  I'm guessing that they will.  We'll see how the market reacts to the employment report and call it a week. 

A sloppy start to the new year as the Dow rose 18 points on good volume.  The advance/declines were 2 to 1 positive.  The summation index has turned around and is moving back up.  We started out with a gap lower on weak news from China.  The fact that the market was able to make it all the way back is a plus but the internal readings on the summation index imply weakness ahead.  We are also making our way back to short term overbought.  My SPY January calls are firmly in the red.  The pop at the open I was expecting today did not materialize.  It looks like I'll be holding this trade into the employment report on Friday now.  GE was up 1/2 and the volume remains heavy.  Gold found buyers to start the new year.  The precious metal was up four bucks but was higher early on.  The US dollar bounced back up as well.  The XAU and GDX had fractional moves on lighter volume.  Mentally I'm feeling OK.  It could have been a disaster to begin the new year but buyers appeared for a change.  Could the decline be over?  Probably not as I do believe that we need a retest of the recent lows at the least.  I really have no choice at this point but to hold on for a few more days to the SPY January call trade.  It is in a cut the loss mode to be sure.  I sincerely doubt that we'll see a huge upside day in the near term but perhaps I'm wrong.  The only news coming out this week will be the jobs report unless the budget stalemate gets solved in a day.  I would not expect that though.  For now it will just be watch and wait for me.  Asia was lower and Europe mixed to begin the trading year.  We'll keep an eye on the overnight developments.