The inflation data came in hot and the market had a gap down at the open. However as has been the case lately it spent the rest of the session trying to climb out of the hole. The Dow fell 225 points on good volume. The advance/declines were better than 2 to 1 negative. The summation index is back in a sideways mode. The NASDAQ actually had a slight gain on the day. The S&P 500 had a slight loss. We got a signal last night from the McClellan oscillator for a big move with the next two sessions. Perhaps today qualified with the big gap down early but we'll see what happens tomorrow. The short term indicators for the S&P are heading sideways with no clear direction. The Bollinger bands here are starting to contract as well. Something should happen one way or the other before option expiration and I'm still leaning towards the call side. Gold was off $8 on the futures. The US dollar finished flat and interest rates jumped up. The XAU was up 3 1/8, while GDX added 2/3. Volume was average. There seems to be no stopping the gold shares. GDX continues to short term oversold with no break. Overextended and staying that way. Yes, I still want to try the GDX February puts at some point but when that point is may not arrive. Money continues to pour into gold and the gold shares despite the overbought conditions. This has turned into a freight train that you don't want to step in front of. Mentally I'm feeling OK. The VIX was slightly lower which doesn't fit with a down market. It did finish well off of the best levels on the day though. The daily candlestick chart here looks like it wants to go lower which would mean higher stock prices. Still short term oversold for the VIX. To me it appears that the S&P 500 along with the VIX are setting up for something big here soon. Which way is always the question. Europe was up and Asia generally higher overnight. More inflation data out tomorrow. We'll see how that goes.