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Thursday, April 25, 2019

The Dow fell 135 points today on lighter volume.  The advance/declines were almost 2 to 1 negative.  This should turn the summation index lower again but it is basically moving sideways.  The overall market fared much better than the Dow, with the NASDAQ in positive territory.  The short term technical indicators on the Dow did roll over today and the Bollinger bands are starting to move closer.  The TRAN had a negative day as well so perhaps my thesis of higher prices here is wrong.  RUT was lower as well.  But the other small stock indexes continue to hold up and as long as that is the case I'm sticking with a bullish bias.  Tomorrow could be interesting with the first look at GDP for the year.  GE lost twenty cents on average volume.  Gold was pretty much flat on the day.  The US dollar was a bit higher.  The XAU fell a point, while GDX lost 1/8 on light volume.  My GDX May calls continue in the red.  GDX is about to break its weekly up trend line from last year if it doesn't rally tomorrow.  That would most likely be the last nail in the coffin for my GDX call trade.  We are holding in here at the last area of support for now.  But it doesn't feel like it will hold up at this point if we see a strong GDP number tomorrow and the US dollar rallies.  Of course I have no idea what the number will be.  Mentally I'm feeling OK.  Earnings still coming in better than expected for most.  Of course when you ratchet down the expectations it makes things look a lot better when they do come out.  But that's the way the game is played and it isn't really a surprise.  We'll see how we close out the trading week tomorrow.  We've got the end of the month coming up next week as well.  We will then be moving into a less favorable time period for stocks based on past history.  There is still the possibility that we've built a massive double top on some of the major stock indices.  I don't think that is the case but what do I know?  Asia was mixed and Europe lower overnight.  We'll close out the week tomorrow.

1 comment:

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