Moving higher as the Dow was up 123 points today on average volume. The advance/declines were 2 to 1 positive. The summation index is trying to turn around. My guess is that the decline is finished for now but we'll see what happens with the Fed tomorrow. The short term indicators for the S&P 500 have turned back up. We've had five wave downside patterns complete on more than one of the major stock indices. We are in a seasonally bullish period for stocks. The S&P is both short and medium term oversold. I think that the weight of evidence says that we'll be moving higher from here. We'll see. I still like the SPY November calls, especially if we go back and test the recent low. Gold was off $11 on the futures. The US dollar was higher and interest rates rose. The XAU fell 2 1/2, while GDX lost 3/4. Volume was heavy to the downside. My GDX November calls are now losers. The short term indicators are heading lower with room to go. Unless things turn around for the gold shares this week, this trade will be another money burner. GDX closed below its 50 day moving average. I'm not giving up on this idea yet considering the geo-political backdrop. Mentally I'm feeling OK. The VIX fell and broke through the short term up trend line. This is another reason to believe that the decline is over. The short term indicators are heading down with room to go. I would not be surprised if the current two day gains for stocks continued. But we'll have to see what happens with the Fed tomorrow. In general Asia was down and Europe up overnight. We'll see what tomorrow brings.

We certainly got a bounce today as the Dow climbed 511 points on average volume. The advance/declines were 2 to 1 positive. The summation index is still moving lower. The Dow led the way higher. A big move up out of nowhere usually occurs in bear markets but we haven't moved the required 20% lower yet. So it's possible that the decline has ended but we won't know right away. Todays advance has turned the short term indicators for the S&P 500 up but we're still oversold there. As the week goes on we'll see if this is a one day wonder or the start of something sustainable. We've got the Fed and the jobs report due this week so there will be plenty of excuses for price movement. End of the month tomorrow as well. We still like the SPY November calls if we can get the timing right. Gold was up $6 on the futures. The US dollar was lower and interest rates ticked up. The XAU shed 1 1/3, while GDX lost almost 1/2. Volume was average. Gold up and the gold shares down is a negative. The Middle East situation over the weekend didn't turn out as bad as predicted so far and that was an excuse to get out of the gold shares which have had a nice run. However geo-political concerns remain a wildcard and we'll hang on to our GDX November calls for now. They are still showing a small profit despite todays loss. The short term technical indicators for GDX are mid-range. Mentally I'm feeling OK. The VIX was lower today and that fits an up market. The short term indicators are trying to roll over and it closed below the 20 level. If the VIX can make it down through the up trend line that lies at the 19 level we'll become more convinced that the worst is over for stocks. Hasn't happened yet but we get the feeling that it will. But we won't get ahead of ourselves because the market will eventually let us know. Europe and Asia were up with the exception of Japan. We'll keep an eye on tonights headlines.

Generally to the downside today as the Dow lost 366 points on average volume. The advance/declines were 3 to 1 negative. The summation index continues lower. The NASDAQ posted a small gain but the overall market was down. The S&P 500 continues to drop and remains short term oversold. We can't even seem to have a much needed bounce. The inflation data today came in where expected. The technical condition of the market is weak and I'm not sure what's going to turn things around. Perhaps the Fed can change the mood next week. The weekly picture for the S&P 500 is oversold as well. The longer term up trend line there that started a year ago has been broken. What more can we say? Oversold, staying that way and we'll see where we go next week. I'm still considering the SPY November calls but I'm not sure where the entry point would be. Gold came to life halfway through the session and rose $20 on the futures. The US dollar and interest rates both finished flat. The XAU added 2 1/8, while GDX was up 2/3. Volume was heavy to the upside. It appears gold found buyers ahead of the weekend just in case the geo-politcal picture gets muddy. My GDX November calls are showing a small profit. GDX has bounced off of its 50 day moving average and the short term indicators are trying to turn back up. Mentally I'm feeling OK. The VIX was up today and is still above the 20 level. Not sure what's next here but if the indicators keep going higher the market will keep going lower. We've got the Fed next week with no changes in policy expected. Earnings continue to be reported. The Middle East tension hasn't gone away. Plenty to ponder over the weekend. We'll keep our eye on the charts as usual. Asia was higher and Europe lower to close out the week. It's Friday afternoon and time for a break.

Another day another sell off as the Dow fell 251 points on better than average volume. The advance/declines were slightly positive. The summation index continues down. Earnings reports were the excuse for todays decline. The NASDAQ is still leading the way lower and that's a negative. The S&P 500 is short term oversold and staying that way. I thought that the 4200 would provide support and be the downside target for this decline. I was wrong as we have passed that level and continue to go down. Not sure what's next but perhaps 4100 will contain things. Or maybe not. The large cap tech stocks are falling apart and they have been what has been keeping things together. The potential positive divergences that we saw earlier for the overall market have been negated. I am still lookng at the SPY November calls but cannot figure out where the entry point would be right now. We'll have to remain on the sidelines for now but that could change. Gold finished flat on the session. The US dollar was slightly higher and interest rates dropped. The XAU and GDX had fractional losses on heavy volume. They did finish up from the worst levels on the day. I had thought that maybe GDP would come in strong this morning and perhaps the gold shares would drop. That is what occurred. Last night I adjusted my open order for the GDX November calls and it was filled this morning. The entry was OK but maybe could have been just a little better. The position is showing a very slight gain. The short term indicators for GDX are around mid-range. So there is room to move both ways. I'm still expecting the Middle East conflict to provide a boost for gold sometime in the November option cycle but I could be wrong. Mentally I'm feeling OK. The VIX was up today but not as much as expected given todays decline. Not sure what that means. Still above the 20 level here. Inflation data due out tomorrow will probably be a market mover one way or the other early on. The S&P is oversold with the summation index moving down in negative territory and we haven't even seen a decent bounce yet. Interesting times. Europe and Asia were down overnight. We'll close out the trading week tomorrow.

Heading back to the downside as the Dow fell 105 points on light volume. The advance/declines were 3 to 1 negative. The summation index is moving down. The overall market was much lower than the Dow with the NASDAQ once again leading the way. The S&P 500 closed below the 4200 level and back below its 200 day moving average. Short term oversold here and staying that way. Looks like I could be wrong about it holding up at around the 4200 level if we get some follow through selling tomorrow. I didn't buy any SPY November calls today but was looking at them. Like I said yesterday, I still believe that we're closer to a bottom than to any kind of top. But who knows? Gold was up five bucks on the futures. The US dollar was higher along with interest rates. The XAU dropped 1 7/8, while GDX lost 1/2. Volume was average. Gold up and the gold shares down is a negative. However I think that the gold shares just followed the overall market lower. I did adjust my open order for the GDX November calls. Still not filled yet. The short term indicators for GDX have now rolled over with plenty of room to go lower. So maybe the idea of trying the calls here again is wrong. I'm sticking with it for now though as the geo-political backdrop remains very uncertain. Mentally I'm feeling OK. The VIX moved back up today which fits a down market. The short term indicators here are mid-range so it could go either way. I can't say that I have a good handle on where the VIX will go next. We'll probably stay on the sidelines with regards to the SPY for now. There is plenty of time remaining in the November option cycle. Asia and Europe were up with the exception of India. We'll keep an eye on the overnight headlines.

The bounce arrived on schedule as the Dow gained 204 points on light volume. The advance/declines were over 2 to 1 positive. The summation index is still moving down. The NASDAQ led the way and that's a plus. The short term indicators for the S&P 500 are trying to turn back up. THere are some potential positive divergences for the S&P. It is also so far holding on to its 200 day moving average. Do we dare attempt the SPY November calls here with so much time left in the November option cycle? After all we do still feel that the S&P will hold the 4200 level going forward from here. I'll think about it tonight. Gold was off $5 on the futures. The US dollar was higher and interest rates finished flat. The XAU and GDX ended about unchanged but up from the worst levels of the session. Volume was light. My open order for the GDX November calls remains out there. GDX remains short term overbought but not extremely so. Remaining patient here for now. Mentally I'm feeling OK. The VIX continued down and the short term indicators are heading lower with room to go. 18 is the level to watch here as that is where the short term up trend line lies. If the VIX can break that line we will be more convinced that long is the way to go from here. We are already pretty sure given the level of the S&P and the seasonality factor. But the market goes where it wants. We are still at the mercy of the next headline of geo-political consequence and the coming earnings announcements. However we are obviously closer to a bottom in the S&P than a top. That said we'll continue to keep a close watch on things. Europe was higher and Asia mixed last night. We'll see how it goes tomorrow.

A mixed bag to begin the trading week as the Dow fell 190 points on light volume. The advance/declines were 2 to 1 negative. The summation index is moving down. The NASDAQ posted a slight gain but that was about it for the bulls. The S&P 500 opened with a gap lower, fought its way back to positive territory and then rolled over again. It is short term oversold so some kind of bounce is expected. The S&P did finally make it to the 4200 level and that has held for now. I still believe that the market will hold up here but I could be wrong. If we continue to drop here while being oversold it could get ugly. However I'm not keen on that scenario right now. We'll look for some kind of bounce and go from there. Gold fell ten bucks on the futures. The US dollar was lower along with interest rates. Those are usually positives for the price of gold. The XAU and GDX had fractional losses on light volume. They both finished up from the worst levels on the day. I already have an open order in for the GDX November calls. It will take a decline in GDX to get filled so it may have to be adjusted at some point. I still think that the geo-political tension in the Middle East has legs and that the flight to safety trade is not dead yet. That said, GDX is still short term overbought but can stay that way during rallies. What we don't want to do here is think that just because there was a successful trade in GDX last option cycle that things will simply repeat in this option cycle. Not to mention it took a war breaking out to bring the gold shares to life. However the longer term down trend line for GDX was broken and higher prices should be expected after perhaps a pause to digest the gains. Mentally I'm feeling OK. The VIX was lower today and that doesn't exactly fit with an overall negative market. However the VIX is short term overbought and the indicators turned lower today. Still above the 20 level. There is a short term up trend line at the 18 level that we'll be keeping an eye on. If the VIX can break below 18 there's a better chance that the decline has run its course. Some economic data due this week including GDP and inflation numbers. But it remains a headline risk environment. Asia was lower and Europe generally higher to start the week. We'll keep an eye on tonights developments.

The selling continues heading into the weekend as the Dow fell 286 points on average volume. The advance/declines were close to 3 to 1 negative. The summation index is heading down. The NASDAQ continues to lead the way lower. At this rate it doesn't look like the 4200 level will hold for the S&P 500 but I'm still a believer that it will. The S&P has made it down to and closed below its 200 day moving average. However there's still more room for the short term indicators to go lower. Perhaps the market knows things that we don't and that is usually the case. The NASDAQ closed at a new low for its decline. It is a nervous market with geo-political tensions taking over instead of the usual economic data. This too will eventually pass and the sidelines isn't the worst place to be for now. Gold was up ten bucks on the futures but off of the best levels on the day. The US dollar was slightly lower and interest rates fell. The XAU and GDX had very slight fractional losses and also finished far from the highs on the session. I did sell all my positions in the GDX October calls after the market opened. The timing was dreadful as the gold shares rallied after I sold the calls. Two of the positions managed to show a profit and one had a loss. The entry on this trading idea was premature and the exit followed suit on the last day to trade. Having three separate positions for the same trade is not the normal way that I do things. However the technical signal was there and I believed in it despite the trade not working in the beginning. Having an extra week to work with certainly was a factor. But the overall timing was horrible. It took a war in the Middle East for this trade to not be a huge loss. The overall trade somehow produced a profit of a little over 100%. Could and should have been better. Doesn't matter now and we're moving on. Already looking at the GDX November calls. A snap back to the longer term trend line that was broken is the next technical expectation. If and when that occurs I'll take a closer look at those GDX calls. Mentally I'm feeling a bit miffed at the way that I got out of todays trade. Had no patience but I don't usually hold on to option positions to the very last trading day. The VIX was higher again today and is above the 20 level. That spells trouble for stocks if we stay above there. The short term indicators are overbought now though. Not sure what's next here. We're still at the mercy of headline risk. We will be checking the charts over the weekend. Asia and Europe are still moving down as the selling around the globe continues. It's Friday afternoon and time for a rest.

More selling today as the Dow fell 250 points on average volume. The advance/declines were 4 to 1 negative. The summation index is now moving lower. We went back and forth for a while before heading lower in the second half of the day. The NASDAQ continues to lead the way down. The Russell 2000 just broke to new lows for this move lower along with the TRAN. It appears that the S&P 500 is going to retest its recent lows. The short term indicators here are moving lower and are not yet even close to being oversold. If we do go lower from here, I think that the S&P will hold around the 4200 level. But I could be wrong. Still at the mercy of whatever headline pops up next and 3rd quarter earnings. Option expiration Friday tomorrow. Gold rallied $18 on the futures. The US dollar was lower and interest rates were mixed. The XAU and GDX finished little changed after being lower early on. Volume was a bit above average. Once again the gold shares did not follow the price of gold higher and that's a negative. But the gold shares could just be following the overall market lower. One day to go for my GDX October calls and I'm still holding on to them. They lost some more ground today. But I'll be out of this trade tomorrow as time has run its course. I still like the gold share calls going forward as the longer term down trend line there has been broken. We'll try and wait for GDX to get back to short term oversold before attempting this idea again. Mentally I'm feeling OK. The VIX was up today and has closed above the 20 level. The short term indicators here are not yet overbought so we could see some more selling in stocks. Should be an interesting expiration Friday. Asia and Europe were down as it's a worldwide dumping of stocks. We'll close out the trading week tomorrow.

Sellers took over today as the Dow dropped 332 points on light volume. The advance/declines were 5 to 1 negative. The summation index is back to tracking sideways. The NASDAQ led the way lower. The S&P 500 couldn't make it above its 50 day moving average. The short term indicators here have rolled over with room to go lower. Waiting on earnings and the next shoe to drop in the Middle East. I'm not sure what is next near term for the stock market. We'll remain on the sidelines regarding the SPY for now. Gold rallied as the futures were up $28. The US dollar was higher along with interest rates. The gold shares did not go along for the ride with gold and that is not a plus. GDX opened with a gap to the upside and sold off for the rest of the session. The XAU and GDX had fractional losses on better than average volume. My GDX call positions lost some ground today. Just two days left here in this trade. Not sure why I'm still holding on to them considering todays negative price action. However the geo-politcal backdrop is about as good as it gets for flight to safety havens and gold is proving to be one this time around. Probably should exit the position tomorrow. We'll see. It appears the gold shares followed the overall market lower today. Mentally I'm feeling OK. The VIX was up today which fits a down market. Getting close to the 20 level and if it gets above there we'll really see some fireworks. Hasn't happened yet and I'm not saying that it will. The short term indicators here have room to go either way. Europe and Asia were lower overnight. We'll see what tomorrow brings.

Back and forth today as the Dow rose 13 points on light volume. The advance/declines were positive. The summation index is still trying to move higher. We opened with a big gap to the downside. The market then rallied back to positive territory, only to move lower once again. Sideways was the trend for the final couple of hours. The S&P 500 remains short term overbought on some of the indicators and stuck below its 50 day moving average. I'm not sure what the next catalyst will be or which way we're going. So far it looks like the positive option expiration week bias is showing up. The NASDAQ was lower on the session though. We are still at the mercy of the next headline coming from the Middle East. Gold finished the day flat. The US dollar was slightly lower and interest rates rose. The XAU was up 2 1/2, while GDX added 1/2. Volume was light. The gold shares outperformed the metal itself and that's a plus. The light volume is a concern though as is the time remaining in the October option cycle. Not to mention that the gold shares are short term overbought. My GDX October call positions are back to showing decent gains with one exception. I'm not sure how much longer I'll hold on to this position. GDX did make it through the longer term down trend line today but the volume was lackluster. Mentally I'm feeling OK. The VIX was higher today which fits with the volatility. Mid-range on the short term techncials makes predicting where it goes from here difficult. I'm on the sidelines with regards to the SPY for now. Three days left in the October option cycle with more uncertanties than usual and a Middle East conflict. Tough trading to be sure. Earnings seem to be in the back seat for now. Europe and Asia were higher overnight. We'll keep an eye on tonights developments.

Moving higher to begin option expiration week as the Dow gained 314 points on light volume. The advance/declines were around 3 to 1 positive. The summation index is trying to move back up. The NASDAQ led the way and that's a plus. The market seems to be shrugging off the geo-political tensions but that could change in a flash. Short term overbought now for the S&P 500. Perhaps the positive option expiration week bias will win out but it's only Monday. Earnings will be front and center for a few weeks but the market is still in a news headline risk mode. Tough trading to be sure and only four days left in the October option cycle. WE will most likely remain on the sidelines with regards to the SPY. Gold was off almost ten bucks on the futures. The US dollar was lower and interest rates were higher. The XAU had a slight fractional gain and GDX finished the day flat. Volume was light. GDX is stalling at the longer term down trend line at 29 and that is to be expected. My GDX October call position is still shwoing a profit but not as much as when the day started. Plenty of risk remains in this trade with only four days left. If GDX can make it though the trend line the profit on this trade will be pretty good. If GDX pulls back from here there probably won't be any profit at all or perhaps a loss. My thinking is that the next negative headline out of the Middle East will drive gold higher but I could be wrong. Or this week remains status quo there and gold drifts lower. I could also just get out with whatever gain this trade is showing now and be done with it. As usual the trading is never easy. Mentally I'm feeling OK. The VIX was lower today and closed below its 200 day moving average. The short term indicators here are around mid-range. So the VIX could go either way from here. We'll watch and see what develops overnight and take it from there. Asia was lower and Europe higher to start the week. We'll see how things go tomorrow.

It is a nervous market as Middle East geo-political tensions have come to a head. The Dow managed a gain of 39 points on light volume. The advance/declines were negative. The summation index is now tracking sideways. The overall market was much weaker than the Dow with the NASDAQ leading the way by a large margin. That is not a plus. The short term indicators for the S&P 500 have rolled over with plenty of room to go lower. I'm not sure what's next but the smaller stocks are leading the way down and that's another negative. Options expiration week coming up with plenty of uncertainty. Things seem like they want to go lower here but we'll have to see what happens over the weekend. It's a tricky time to try and navigate what will happen next. Perhaps we'll get a shot at the SPY October calls next week after all. But you've got to be nimble and pay complete attention. The risk might just be too high vs. the reward. We'll consider what to do over the weekend. Gold took over as the flight to safety choice as the futures soared $58. The US dollar finished little changed and interest rates dipped. The XAU climbed 4 3/4, while GDX gained almost 1 1/4. Volume was heavy to the upside. GDX has reached the target of the down trend line that began in May at the 29 level. It makes sense that it is stalling here but there's a chance that it could get through and move even higher next week. It could also be turned around here as well but with the problems in the world at the moment that doesn't seem to be in the cards. But anything can happen in this game. My GDX October call positions went from solid losers to a showing a profit overnight. Two of the positions are now in the black, with the other showing a small loss. I'll have to check and see where the next upside target lies on the daily chart. I would have liked to see a better gain in the gold shares today considering that gold went up over fifty bucks. But we'll take what we can get. Mentally I'm feeling OK. The VIX was up today and made it over the 20 level at one point. The short term indicators are now moving back up. This implies more volatility to come which will most likely make next week very interesting in the markets. We are at the mercy of headline risk with geo-political uncertainties front and center. We'll do the best we can given the circumstances. Europe and Asia were lower to close out the week overseas. It's Friday afternoon and time for a break.

Volatility returned today as the Dow fell 173 points on light volume. The advance/declines were 5 to 1 negative. The summation index is now tracking sideways. It seemed like a quiet session as the inflation report came in where expected. However halfway through the day the market sold off 60 S&P points in a little over an hour. It attempted to come back the rest of the day. The S&P is more overbought than oversold here but not at extremes. The smaller stocks got hit hard today and that is not a plus. The very negative breadth is a warning as well. One day does not make a trend but it appears that the recent rise has run its course. Gold dropped $6 on the futures. The US dollar was higher along with interest rates. The XAU fell 2 1/2, while GDX lost over 1/2. Volume was average. My GDX October calls went from break even back to solid losers with todays loss for GDX. GDX has been turned back by its 50 day moving average. In retrospect it appears yesterday was the time to exit this trade. There's still six days left in the October option cycle. If GDX doesn't turn back up tomorrow this trade will probably be left for dead. Mentally I'm feeling OK. The VIX moved back up today and remains above its 50 day moving average. Not sure where it is heading next. There is plenty of room for the short term indicators to move higher. That would not bode well for stocks in the near term. We made it through the inflation data but I'm not sure what the next catalyst for market movement will be. Option expiration week is coming next week. Still plenty of geo-political turmoil to get through and earnings season is about to begin again. We'll keep an eye on things as usual. Asia was higher and Europe mixed again overnight. We'll close out the trading week tomorrow.

Another day of gains despite higher than expected inflation data as the Dow rose 65 points on light volume. The advance/declines were positive. The summation index has turned back up. We did see some selling during todays session but the market climbed back in the final two hours. Once again we had news that you would think would lead to a negative market but it didn't. The NASDAQ continues to lead and that's a plus. Getting to short term overbought on the S&P 500 but not there yet. Maybe we'll make it to the 50 day moving average at 4410. After that we have a down trend line on the daily chart that comes in just above 4450. But perhaps we're getting ahead of ourselves as we still have the consumer inflation report to digest tomorrow. Gold added another dozen on the futures. The US dollar finished little changed and interest rates slipped. The XAU gained 2 1/4 and GDX added 1/2. Volume was average. GDX had made it back to its 50 day moving average and is not yet short term overbought. The down trend line on the daily chart that began in May lies at the 29 level. We are alomst there and that should prove to be a stopping point for this short term uptrend. But we'll see. The geo-political background has had a near term influence on the price of gold to be sure. Not sure how long that lasts. My GDX October call positions have made it back to one winner, one break even and one loser. The combined total is now back to break even. This is more than I could have hoped for a week ago but the world has changed. There's still almost a week and half left in the October option cycle but I probably shouldn't get greedy. Mentally I'm feeling OK. The VIX was lower today which fits an up market. Still above the 50 day moving average here and just about short term oversold. The VIX is now comfortably below the 20 level. Asia was up and Europe mixed overnight. We'll see how the market reacts to tomorrows inflation report and go from there.

Continuing higher today as the Dow rose 134 points on light volume. The advance/declines were around 3 to 1 positive. The summation index has turned around and is trying to move higher. We did finish well off the highs for the session heading into the inflation data. With all that is going on in the world it has been an impressive week so far for stocks. I do think that we've put in the bottom at 4220 for the S&P 500 however that doesn't mean we won't head lower again in the coming sessions. That level should contain any more selling though in my view. If we do get back there it would be the spot to try the SPY October calls. But I don't think that we will get back that low. I could be wrong. The short term indicators for the S&P 500 are heading up and are not yet completely overbought. Gold was up another $9 on the futures. The US dollar was a bit lower and interest rates were steady after dropping in the futures market yesterday. The XAU and GDX had fractional gains on light volume. The short term indicators for GDX are the same as for the S&P. Pointing up and not yet short term overbought. My GDX October calls remain the same with one position showing a profit and the other two showing losses. I'm still trying to cut the loss here. Mentally I'm feeling OK. The VIX was lower today which fits the market price action for Tuesday. The short term indicators are heading lower with room to run. However the VIX, like the overall market, could turn at any time. Which makes the reaction to the inflation data important as we try and figure out where we go from here. One of our indicators for the S&P is short term overbought so a drop from here would not be a surprise. But an extended decline from these levels would be. We'll watch and wwait to see what happens. Europe and Asia were up overnight with the exception of China. We'll keep an eye on tonights headlines.

Some upside follow through today as the Dow gained 197 points on light volume. The advance/declines were 2 to 1 positive. The summation index is trying to turn around. My guess is that it will eventually be successful here. The index is in negative territory and that usually doesn't last too long. Geo-political tensions arrived over the weekend in the Middle East. The US stock market seems to have shrugged it off. That's two recent negative market news events that haven't been met with selling. We think the S&P 500 has put in a bottom here. The short term indicators here are now mid-range. Perhaps we'll go back and test the lows but they should hold if that happens. Probably too late for the October SPY calls. Gold found safe haven buying as the futures were up thirty bucks. The US dollar finished flat and the cash bond market was closed today. The XAU rose 2 1/4, while GDX climbed almost 2/3. Volume was average. Considering the move up in gold the performance of the gold shares was lackluster. I'm still holding on to my GDX October call positions although that may be a mistake. One of them is showing a small profit still but the others are solid losers. Most likely should be out of this trade sometime this week. Mentally I'm feeling OK. The VIX was higher today which doesn't fit an up market. Almost mid-range with the short term indicators here as well. I do expect some selling in the stock market at some point this week. Perhaps on Wednesdays or Thursday inflation reports. That could possibly give us a shot at the SPY October calls. We'll see. My attention remains with the GDX call trade for now. Would have liked to see more buying of the gold shares today though. Europe and Asia were lower to begin the week. The world is on edge right now as it tries to figure out the implications of a Middle East conflict. We'll see what tomorrow brings.

There was a dramatic one day reversal to the upside today as the Dow opened lower only to turn around and soar higher. The most watched index gained 288 points on light volume. The advance/declines were almost 2 to 1 positive. The summation index is still moving lower but not as much as recently. Perhaps this is the beginning of an attempt at a turnaround there. The jobs report came in better than expected and the market gapped down at the open. But then buyers showed up and we marched higher until the last half hour. A market that moves up in the face of news that was considered negative is a plus for the bulls. The NASDAQ once again led the way up. The S&P 500 held around the 4220 level once again and I'm calling that as the bottom for this two month old decline. The short term indicators for the S&P 500 have turned up although we are still oversold. Yes we could have some backing and filling going forward but the indicators got so blown out to the downside that I believe it's time to turn around. We will be looking at the SPY October calls if it isn't too late already. And it very well could be. Gold was up $11 on the futures. The US dollar was a bit lower and interest rates rose. The XAU was up 2 1/4, while GDX added over 1/2. Volume was good. I was hoping for more of a gain for the gold shares but at least we're moving in the right direction. One of my GDX October call positions is slightly positive now but the other two are still solid losers. This trade is still in the cut the loss mode and I should probably be out on Monday even with two weeks to go in the October option cycle. The short term indicators for GDX have turned back up and have plenty of room to go higher. The weekly candlestick chart here has a potential bullish hammer pattern on it. But I'm not sure holding on to this trade any longer is the right thing to do. I'll decide what to do over the weekend. Mentally I'm feeling OK. The VIX was lower today and barely closed below its 200 day moving average. The short term technical indicators continue to fall. The VIX appears as though it wants to go lower but I've had a tough time trying to figure this one out. We thought today would be important for the markets and it was. It appears that the bulls are making a stand here. My guess is that it will be successful. We'll be checking the charts over the next couple of days to try and figure what to do next. Monday will be a partial holiday for some in the US but the stock market will be open. Europe and Asia finished the week on a positive note with the exception of Japan. It's Friday afternoon and time for a rest.

Waiting on the employment data as the Dow lost 10 points on light volume. The advance/declines were slightly negative. The summation index is moving down. Most of the major stock indices had small losses today. The S&P 500 remains short term oversold. Tomorrow will be an important session in my opinion. If the market continues to drop, 4200 will be in play for the S&P 500. But if the market can find a way to move higher, there would be a short term bottom in place on the daily charts. I'm not sure which way things will go. We have yet to see the big volume blow out sell off that usually accompanies these moves lower. All we can do now is wait. Gold was off another buck on the futures. The US dollar was lower along with interest rates. The XAU was actually up a point, while GDX rose 3/8. Volume was light. Normally I'd say that the gold shares being higher when gold itself isn't doing anything is a positive. But the precious metals complex is so blown out that I'm not sure that it really means anything. All my GDX October call positions remain in the red. Still waiting for a bounce there to try and cut the losses. Mentally I'm feeling OK. The VIX was slightly lower today. Still short term overbought here but not extremely so. Below the 20 level but above the 200 day moving average. So we'll see what the reaction to the jobs report is and go from there. Still two weeks left in the October option cycle. Would like to try the SPY October calls at some point but if we go up tomorrow it's probably too late. We'll see. Asia and Europe finished higher with the exception of Germany. We'll close out the trading week tomorrow.

An oversold bounce showed up today as the Dow rose 127 points on light volume. The advance/declines were positive which hasn't been the case lately. The summation index is still moving down. The NASDAQ once again was the outperformer and that's encouraging for the bulls. However we all know one day doesn't make a trend. The major stock indices remain oversold. The S&P 500 still hasn't reached our target of 4200 but maybe 4220 was close enough. We'll see as the decline has been relentless. We'll have to wait and see the reaction to Fridays employment report. Gold continued lower by a few bucks on the futures. The US dollar was a bit lower along with interest rates. The XAU and GDX had fractional losses on light volume. My GDX October call positions remain solid losers. I'm still waiting for some kind of bounce for the gold shares but none is forthcoming. GDX remains short term oversold and staying that way. Mentally I'm feeling OK. The VIX was lower today as it rose above the 20 level again only to fall back. It remains short term overbought. The daily candlestick chart now looks like it implies lower values for the VIX which would certainly help stock prices if it would occur. We are still considering the SPY October calls at some point. Oil took a big drop today. Asia was down and Europe mixed in last nights trade. We'll see what Thursday has in store for us.

Sellers continue to dominate as the Dow got clobbered today and fell 430 points on average volume. The advance/declines were 5 to 1 negative. The summation index is heading down. We are through the zero line on the summation index and the market is responding by continuing to fall apart. The big move predicted by the movement in the McClellan oscillator after Fridays close came to fruition today. Oversold, staying that way and that song seems to never end. The NASDAQ led the way lower. We are just thirty S&P points away from the 4200 level which in my view will end the decline. 4200 is where the 200 day moving average resides along with the up trend line that began a year ago. So it is important that the market finds a way to hang on there and I believe that it will. Now it could bounce around there for a few days above and below but it should be the area that puts an end to this downturn. If not, we're in for a whole lot more of trouble. Gold was off $7 on the futures. The US dollar was slightly higher and interest rates continue to rise. Both the XAU and GDX had slight fractional gains on good volume. The fact that the gold shares didn't follow the overall market lower was a plus. But my positions in the GDX October calls are still all losers. Still short term oversold for GDX so maybe we can see some sort of bounce to cut the loss on this trading idea. However that would be the most we can hope for here. Mentally I'm feeling OK. The VIX climbed today and was over the 20 level at one point. The short term indicators here have turned back up and are not completely overbought yet. So we could see some more selling in the near term which would fit with getting down to 4200 on the S&P 500. We'll be looking at the SPY October calls once we get there. Keep in mind that we could pass through 4200 and then move back up as buyers enter the picture. Or the market will just keep selling off but I don't believe that will be the case. Asia and Europe were lower as it's a worldwide plunge for now. We'll keep an eye on the overnight developments.

Another day another loser as the Dow fell 74 points on what passes these days for average volume. The advance/declines were 4 to 1 negative. The summation index continues down. October began just like September ended with no buyers in sight. Oversold, staying that way and we are beginning to wonder if this will ever end. Well of course it will at some point we just don't know where that point will be. The NASDAQ did manage to post a gain again so all is not lost for the bulls. It still looks like the S&P will travel down to the 4200 level even though it remains short term oversold. We did get a signal on Friday from the McClellan oscillator for a big move within two days so we'll see if that pans out tomorrow. Some economic data due out this week with the employment report on Friday being the key. We remain on the sidelines with regards to the SPY. Gold continues to fall as the futures lost twenty bucks. The US dollar had a strong session and interest rates continue to climb. The XAU fell 4 points and GDX lost 7/8. Volume was good to the downside. I purchased some more of the GDX October calls this morning at a closer to the money strike price again. So now I have 3 positions in this trade and all are losers. Sometimes you get what you deserve. Gold and the gold shares are in free fall. Despite the extended short term oversold condition here, they continue to collapse. This is one of those times when the technical analysis just isn't working. Yet I continue to believe that it will. The sidelines or short is the place to be regarding the gold complex right now. I'm here waiting for a bounce that is not coming. There is still plenty on time in the October option cycle but even that won't save these trades. At some point this week I should take the losses and move on. Mentally I'm feeling OK. The VIX was up slightly today. The short term indicators look like they want to turn back up which would imply lower stock prices going forward. The VIX did manage to close below its 200 day moving average. If todays price action in the TRAN and Russell 2000 are any indication of what's to come, we'll be heading down tomorrow. Asia was mixed and Europe down to begin the week. We'll see how things go tomorrow.