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Thursday, October 29, 2020

A weak bounce today as the Dow rose 139 points on heavy volume. The advance/declines were 2 to 1 positive. The summation index is moving lower. We had been up over 350 at one point. Somethings going on here but I don't know what. Tech earnings after the bell should set the tone for tomorrows open barring any other overnight developments. The S&P 500 remains short term oversold. We'll get the end of the month tomorrow and the trading could be skewed. We'll follow the summation index and the trend is down. I'm not sure what to expect next, so no SPY trades in mind for now. GE was off a few cents on good volume. Gold was off around half a dozen while the US dollar continued higher. The XAU was up 2 1/4, while GDX added 3/8. Volume was average. The gold shares followed stocks once again. Normally I'd say that it's bullish that the gold shares rose with the price of gold going down. But these aren't normal times. The rise in the US dollar would be a headwind for gold if it continues. My GDX November calls are still solid losers. I do have another open order for the GDX November calls at a lower strike price out there. I may cancel it tonight after I review todays price action. The technicals say buy the gold shares here but my thinking has been pretty wrong lately. Mentally I'm feeling OK. The VIX was lower today and that fits with an up market. Still overbought here and the VIX is saying that the decline is probably over for now. We'll see. Hopefully things will start to become clearer when we get the election out of the way next week. We're entering a favorable seasonal period for stocks but this year has been anything but predictable. I think that we'll just let the week and month come to a close. Asia and Europe were mixed overnight. We'll see how things go tomorrow.

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