Jimmybees Stock Market Trading Blog

2012-02-17T17:03:00.000-08:00

The Dow closed out the week with a gain of 45 points on light volume. The advance/declines were positive. The overall market was weaker than the Dow though. I'm not exactly sure where we go from here but the trend is still up until proven otherwise. It's a long weekend with a Monday holiday. We'll have to see what kind of news comes out of Europe. GE was up 1/4 on good volume. We're back up to the top of the trend channel. Perhaps the action in GE today is a precursor for the stock indices next week. That's a guess, as usual. Gold fell a couple bucks on the futures as the US dollar finished the day little changed. The XAU fell almost 3 points. ABX down 1 1/8, GG off 1/3 and NEM dropped a buck. Volume was average. I am thinking about trying the gold share calls again, since we are just about at the Gold/XAU buy signal once again. We are also more oversold than overbought. I'll consider this trade over the weekend. Mentally I'm doing OK. I'm still getting past yesterdays debacle with the horrible ABX trade. But you've got to move on. We're on to the March option cycle. The stock indexes continue to move higher despite the ongoing backdrop of headline risk. There is also a possible negative divergence with the daily RSI. So we'll see what happens next week. For now it's Friday afternoon before a long weekend and time for a break.

2012-02-16T13:08:00.000-08:00

The market rallied back today as the economic numbers looked to be better than expected. The Dow rose 123 points on average volume. The advance/declines were 3 to 1 positive. The market ignored possible European credit downgrades and the Greece situation. The stock indices have the feel of wanting to go higher. Throw in an expiration Friday and I think we'll see better prices again tomorrow. We worked off the recent short term overbought condition and we're off to new highs for the year. Had I not been preoccupied with the losing ABX trade, perhaps I would have tried the OEX calls. GE was up 1/4 on light volume. Still waiting for the breakout here. Gold was flat on the futures after selling off early. The US dollar was weaker today. The XAU had a good day, up 5 1/3. ABX gained 3/4, GG rose 2 1/8 and NEM was up 7/8. Volume was good. The earnings for ABX were below expectations and it sold off with gold early. My ABX call trade ended up worthless. A complete loss. I didn't listen to the technicals and paid the price. There is no excuse. I didn't have the discipline and it cost me. Had I chosen GG instead, it would have worked out. But my information there stated the earnings would be out on the 24th and they came out yesterday after the bell. The Gold/XAU ratio signal was valid as we rallied the gold shares today. Mentally it's a loss of confidence once again. That is just one of the problems with losing trades. They make me scale back the risk and potentially miss out on better trades. As was the case with the OEX today. It's something that I've worked on in the past but today sends me back to square one again regarding my mental trading state of mind. I'll need to put todays losing trade behind me and move forward as soon as possible. The battle is always waged within myself. The stock indices had a good day today and appear to be poised to move even higher. Gold also made a nice comeback after selling off at the open. I'm not sure what my next trade will be at this stage. We'll see how the expiration goes tomorrow and then try to enjoy the long holiday weekend.

2012-02-15T13:12:00.000-08:00

A one day reversal to the downside as the Dow opened higher and closed lower. The main index lost 97 points on average volume. The advance/declines were negative. Worries over Europe took center stage again. I still expect some type of upside before the end of the week. I did not expect the negative action today though. So we'll see. GE fell 18 cents on light volume. We're still in the trading range but at the lower end of it. When we do break out, it should be a pretty good move. Gold gained $10 on the day as the US dollar was up a bit. The XAU fell 2/3. ABX and GG had fractional losses on light volume, while NEM was up over 3/4. My ABX calls are dead and I will be burying them tomorrow. I don't think that the earnings can save them now. The Gold/XAU ratio is still in the buy zone. Perhaps I'll go out to the March options. However March is historically the worst month for the price of gold. Mentally I'm feeling OK. My work says that if we do not see any upside through Friday that we will be very oversold both short and medium term. That is why I expect some upside in the stock indices prior to the end of the week. In retrospect the ABX trade was a mistake and I'll be taking the loss tomorrow. I should have simply listened to the technicals. It's not my first wrong move and it won't be the last. Losses are part of the game. We'll see what transpires overnight and check the ABX earnings report in the morning.

2012-02-14T13:14:00.000-08:00

Down for much of the session, the Dow made a last half hour rebound and finished the day up 4 points on light volume. The advance/declines were negative. I'm still a believer in higher prices by the end of the week. The positive expiration bias seems to be in effect. After that, who knows? If I wasn't stuck in the ABX trade, I would perhaps attempt the OEX calls here. Today was probably the day to do that. Hindsight is rarely wrong. GE was off 1/8 on light volume. Still moving sideways here. The Bollinger bands on the daily chart here are very tight. That implies a huge move one way or the other as I stated a few days ago. It will happen, it's just a question of when. Gold lost $7 on the futures as the US dollar had a very good day. The XAU fell 2 7/8. ABX down 3/8, GG off 1/3 and NEM dropped 2/3. Volume was good. My ABX February calls, barring a miracle, are dead. Todays loss pretty much sealed that. The only chance would be a rally off the earnings report on Thursday morning. I think that was one of the problems for me on this particular trade. I placed too much emphasis on the earnings and did not listen to the technicals. However the Gold/XAU ratio buy signal is now in effect. Mentally I'm feeling OK. Todays action in the stock indices seems bullish to me, as we tried to sell off but didn't. We've got some Fed news tomorrow and plenty of economic data for the rest of the week. The summation index is starting to move sideways. We'll get through tomorrow and await the ABX earnings on Thursday.

2012-02-13T13:10:00.000-08:00

Back to the upside on the Greece bailout today as the Dow rose 72 points on light volume. The advance/declines were 3 to 1 positive. I'm not much of a believer in light volume rallies, especially on a Monday. However later this week, I'm looking for some positive market action in the stock indices. I'm also a believer in the positive expiration bias this week. Plenty of economic data to contend with this week so we'll see what happens. GE was up about 20 cents on light volume. No trades there for now. Gold was flat on the day as the US dollar lost a touch. The XAU fell 7/8. ABX, GG and NEM were all off an 1/8 or so on light volume. I'm still holding the February ABX calls and against my better judgement. Probably should have dumped them this morning. But with the earnings on Thursday there's still a chance that this trade could work out. Another factor for me is that the Gold/XAU ratio is practically at a buy signal again. That doesn't always mean a gold rally is imminent but the odds are better for some upside. So we'll see. I won't be surprised if it a loser though. Mentally I'm feeling tired, did not sleep well. So now Greece is out of the way until the next crisis there but I don't expect any this week. I think we worked off the short term overbought condition on Friday for the stock indices and I expect higher prices by the end of the week. The ABX trade could go either way but it isn't looking good for a profitable ending. But I could be wrong and often am. We'll see what tomorrow brings.

2012-02-10T13:05:00.000-08:00

We finally got a bit of a pullback today on headline risk as the Dow fell 89 points on light volume. The advance/declines were 3 to 1 negative. This action should turn the summation index around as it was getting about as high as it could. Troubles in Greece resurfaced today but really, they never went away in the first place. But that was the focus of the markets today. The short term overbought condition has been relieved in my opinion. Expiration week coming up and all eyes will be on Europe over the weekend and that will set the tone for Monday morning. I have no idea how that will turn out. GE fell 1/4 on light volume and we had a gap lower as well. It isn't bullish. I'll have to rethink my stance on purchasing some March calls here. No trades for me in GE right now. Gold fell around $15 on the futures and a bit more in the aftermarket. The US dollar had a strong session due to the anxiety out of Europe. The XAU dropped 3 2/3. ABX and GG fell 7/8, while NEM lost a buck. Volume was average. My open order for the ABX calls was filled when we gapped down at the open. I therefore actually got a better price than my limit order. The trade remains at break even but it will probably be a loser if I continue to hold it into late next week. We had a gap down on most of the gold shares and that isn't bullish. Support did not hold. The only way this trade will work is if we get a complete reversal to the upside on Monday morning. That isn't very likely. Mentally I'm feeling a bit tired, could have slept more. We got some downside today in the stock indices but I really don't think that it is the beginning of some huge drop next week. We've got the positive bias of expiration week combined with what I believe is an already short term oversold condition. I could be wrong and often am. The ABX trade is on but I don't think it is going to work out as I desired. I'll have plenty to think about over the weekend and hopefully I'll make the proper decisions. We are back in headline risk mode and that is a tough way to trade. Virtually anything can happen at any time which is always the case when it comes to trading. But a news driven marketplace seems to magnify events one way or the other. It's possible that volatility will return and that makes for a trickier environment. So I'll keep an eye on things over the weekend and go from there. For now it's Friday afternoon and time for a break.

2012-02-09T14:08:00.000-08:00

Overbought, staying there and a slight gain today as the Dow gained 6 points today on average volume. The advance/declines were about even. The overall market was stronger than the Dow. The advancing grind continues. Day in and day out there is no concentrated selling. The trend is up and the rally continues. Summation index continues higher but we are just about as far as we can go. But who knows? GE was off 1/8 on light volume. A bearish candlestick pattern on the daily chart here as well as a negative divergence on the RSI. They imply lower prices for GE in the near term. Gold was up $10 in the futures market and fell by that amount in the aftermarket. The US dollar ended flat on the day. The XAU fell 2/3. ABX, GG and NEM all had fractional losses on light volume. I'm leaving in the open order for the February ABX calls but the risk is probably higher than I would normally take on. There are only 6 days left in the February option cycle. Todays action in gold itself wasn't bullish. However I've been a believer in this trade for some time now. So we'll see. I may cancel it tomorrow though. Mentally I'm feeling tired, did not sleep enough. I have expected the market to take a rest but it hasn't happened. Perhaps we will simply continue the upwards trend into expiration. That's a guess as usual. We'll see how gold closes out the week tomorrow. There are still the ABX earnings out next week as well. So we'll get through Friday and go from there.

2012-02-08T13:10:00.000-08:00

A minor attempt at a sell off this morning but the Dow came back and ended the day with a gain of 5 points. The advance/declines were positive and the volume was average. The overall market was stronger than the Dow. No signs of a pullback although the short term technical picture is very overbought. The trend is up until further notice. GE had a fractional gain on light volume. No trades there for now. I'm still considering the March calls. Gold was down $17 on the futures but came back by $5 in the aftermarket. The US dollar was basically flat. The XAU fell 1/3. ABX, GG and NEM had fractional losses on light volume. I'm still leaving in the open order for the February ABX calls. Running out of time here and I usually don't do well with the short term trades. We'll see if the order gets filled tomorrow and go from there. Only 7 days left in the February option cycle. Mentally I'm feeling OK. Not a lot of data out this week and not a lot of news so far. There is really nothing new to report. The rally continues to have legs and there is nothing to stop it just yet. But we are very overbought and that condition won't last forever.

2012-02-07T13:30:00.001-08:00

The upwards grind continues as the Dow gained 33 points on light volume. The advance/declines were positive. Nothing technically has changed. We continue to be overbought and moving higher. The song remains the same. Very overbought on a daily basis. I've been expecting a pullback in the stock indices for quite some time and it really hasn't happened. GE was up 1/8 on light volume. Still stuck in a trading range and awaiting the breakout one way or the other. Gold was up $23 on the futures today as the US dollar took a hit. The XAU fell a point though as it failed to follow the precious metal higher. Not exactly sure what that means going forward but it usually isn't bullish. ABX and GG had fractional gains, while NEM was flat. Volume was light. I am keeping the open order in for the February ABX calls. The open interest expanded a bit on the February 50 ABX calls from yesterdays volume. Todays volume on this option was huge as well. Time is running out here though but with the earnings report coming out next week, anything can happen. Mentally I'm feeling OK. There isn't much else to say as far as the stock market is concerned. Continuing higher along with the summation index. Gold had a nice snap back and we'll have to see if we can take out the recent highs there. If not, we may be setting up a short term top but I don't think that is the case. The recent dollar weakness is supportive to the price of gold and it looks like the dollar could fall a little further. We'll see.

2012-02-06T13:18:00.000-08:00

We started the day off lower and tried to claw our way back as the Dow lost 17 points on very light volume. The advance/declines were negative. Conditions remain the same, overbought and staying there. The summation index continues higher. Not a lot of economic data out this week, so we could be at the mercy of the headline events. GE was flat today on light volume. Still in a trading range here as we have been from the beginning of the year. A breakout one way or the other should be coming soon. Gold lost $15 on the futures. The US dollar was higher early and then fell back. It finished the day little changed. The XAU was flat. ABX, GG and NEM had fractional changes one way or the other on very light volume. I placed another open order for some February ABX calls. However time is running out on these options and the trade has more risk than I would usually take. That said, I would still like to give it a shot. The open interest did not expand with the volume Friday for the ABX February 50 calls. That isn't exactly bullish. I will have to ponder this trade tonight and take it from there. Mentally I'm feeling OK, slept well enough. I'm not exactly sure what to expect from the stock indices this week. We've been overbought for so long that the technicals are out of whack. We'll see what happens tomorrow.

2012-02-03T14:51:00.000-08:00

It was up, up and away from the start as the Dow gained 156 points on the heels of a positive employment report. The advance/declines were almost 4 to 1 positive and the volume was good. We simply continue higher regardless of being overbought. That is how it works in bull markets. The summation index continues higher but we are getting pretty high here. There's some room left but I would expect a turn in this indicator at some point in February. It doesn't mean we have to see a big decline in the indices, sideways would also be an option. GE rose 1/4 on average volume. We're still in a sideways channel here but if the overall market is any indication of things to come, GE will break out to the upside. Hasn't happened yet. I'm still interested in the March calls. Gold finally started to pull back as it lost $20 in the futures and another $10 in the aftermarket. The US dollar finished the day relatively flat despite the better jobs numbers. The XAU fell about 2 1/2. ABX lost 3/4, GG dropped 1 1/8 and NEM shed 1 1/4. Volume was good here and that's a concern for the bullish case going forward. I again placed an order for some ABX February calls but canceled it near the end of the trading session. With only 2 weeks to go in the February option cycle, any option trade here will take on even more risk. The earnings report for ABX comes out the Thursday before expiration this month, adding to the risk as well. Once again there was very heavy volume in the February ABX 50 calls. We will have to see if it expanded the open interest there on Monday as was previously the case. I'm still considering the calls here. Mentally I'm feeling very tired, did not sleep well. The stock indexes continue higher and there is no end in sight. Of course when you start to make statements like that, the end is usually near. Very overbought on the technicals in the stock market. I think that something to the downside will happen this month or at the very least a sideways pause. The timing of such an event, if it occurs, is the question. I have no answers. Gold started to correct today and I'll be checking the charts to see if the February gold share calls are still the proper trade. I think they are. But we all know there are no guarantees in this game. It's Friday afternoon and time for a rest.

2012-02-02T13:13:00.000-08:00

The expected holding pattern before the employment report occurred today as the Dow fell 11 points on average volume. The advance/declines were positive. The overall market was stronger than the Dow. Still overbought on the stock indices. So we'll get tomorrows number and take it from there. GE was flat today on light volume. The Bollinger bands continue to tighten here, so expect a big move one way or the other in GE soon. I'm still interested in the March calls here but in no hurry. Gold continues to move higher, up about $10 on the futures and a touch more in the aftermarket. The US dollar was a bit higher today but really was in a holding pattern waiting for tomorrows employment report. The XAU was up 2 points. ABX gained 1/2, while GG and NEM each rose over a buck. Volume was light. I placed an order in for the ABX February calls again. Once again the volume on the February ABX 50 calls was heavy. The open interest there expanded again yesterday. I'd like to own some of these if the price is right because there is obviously something going on here. What? I don't know. Mentally I'm feeling OK. So we'll see what the employment report brings and the markets reaction to it. We've been overbought for so long on the stock indices that you'd just expect the markets to continue to churn higher regardless of what the employment report is. Gold is a mirror of the stock indexes overbought and staying there condition. We'll see what tomorrow brings.

2012-02-01T13:17:00.000-08:00

February trading began to the upside as the Dow gained 83 points on average volume. The advance/declines were 5 to 1 positive. The rally from the October lows continues. The over the counter stocks continue to lead the way and that is bullish going forward. Summation index continues higher. We worked off some of the overbought conditions in the past week or so and now we are moving higher. Nothing seems to be in the way of higher prices. GE had a fractional gain after being higher earlier. Volume was average. I'm still looking for a decent move one way or the other in the near future. My thinking here is still for the GE March calls. Gold was up around $9 on the futures today. The US dollar took another drop today but the move in gold itself was muted. The XAU was off 1/4. ABX was flat, GG fell 3/4 and NEM dropped 1/3. Volume was light. Overbought on the gold shares and I canceled the open order for the ABX February calls. I once again noticed some extreme volume in the ABX February 50 calls. The last time that happened about a week ago the open interest expanded as well. We'll see tomorrow if that is again the case. Mentally I'm feeling tired, did not sleep enough. The stock indexes remain overbought and rallying. That has been and still is the case. You cannot fight that. I'm not sure what my next trade will be. I was leaning towards the gold share calls but we have yet to see a pullback in gold itself. I will have to consider exactly what to do later tonight. Perhaps I'll wait for the markets reaction to the employment report and go from there. A little more than 2 weeks left for the February option cycle. Tomorrow should be a holding pattern awaiting Friday.

2012-01-31T13:18:00.000-08:00

Another attempt at a one day reversal as the Dow opened higher and closed lower. The Dow fell 20 points on average volume. The advance/declines were positive. We are moving to short term oversold and I would expect a move higher in the stock indices tomorrow or the next day. We also have the positive beginning of the month money flows to bolster the short term bullish case. We've been kind of moving sideways for a week and a half. I expect a positive resolution to the recent indecision. GE fell almost 1/4 on average volume. The Bollinger bands on the daily charts are contracting here. This implies a big move one way or the other soon for GE. I have no idea in which direction. I would still like to get the March calls for GE at some point. We'll see. Gold gained $6 on the futures despite the US dollar being a bit higher today. The XAU was flat. ABX, GG and NEM had fractional moves one way or the other on light volume. I still have in the open order for the ABX February calls. I'm not sure how long I'll leave this order in. However, I'm still a believer in higher prices for the gold shares before the February option expiration. Mentally I'm feeling OK, slept well enough. Seems like we're in a short term holding pattern for the stock indexes here. It should be resolved by Friday at the latest. That's when we'll get the employment report. Gold is overbought and staying there but I still think we've got more room to the upside. We'll see how February starts tomorrow.

2012-01-30T13:17:00.000-08:00

The market tried to sell off this morning but buyers stepped in and we closed the day down only 6 points on the Dow. We were down over 100 early. The advance/declines were almost 2 to 1 negative and the volume was weak. We are getting to a point where perhaps we will see some type of pullback in the stock indices. However with the beginning of the month money flows coming in soon, the picture is mixed at best. Any decline can still be purchased in my opinion. The summation index continues higher. GE was off 1/8 on light volume. I'm now looking at the March calls here. No hurry to purchase them though. Maybe at some point in February if we get oversold on a daily basis. Gold fell a touch today on the futures as the US dollar was higher. The XAU was off 1 2/3. ABX and NEM lost 1/3 and GG fell 2/3. Volume was light. I think we are consolidating the recent huge gains in the gold shares and will then move higher. I have an open order in for some ABX February calls. Gold and the gold shares followed the overall market being lower in the morning and then fighting their way back. Mentally I'm feeling OK. Haven't had any real news out of Europe lately and that has contributed to the rise in the stock indexes. It has remained in the background. That could change at any moment and must be kept in mind. Plenty of economic data out this week capped off by the employment report on Friday. We'll see what tomorrow brings.

2012-01-27T13:07:00.000-08:00

The Dow was weaker for a second day in a row as we lost 74 points on light volume. The advance/declines were almost 2 to 1 positive as the overall market was stronger than the Dow. The GDP report was a bit weaker than expected. The stock indices, with the exception of the Dow, continued to grind higher this week. We are long overdue for a rest. The back and forth this week could be a sign that the rally is waning. Or not. There seems to be an awful lot of liquidity out there. I'm going to try and wait for some technical evidence of a pending decline. Otherwise the upward grind will continue. GE was flat on light volume. Nothing new to report here. Gold continued to climb, up $5 on the futures and another $5 in the aftermarket. The US dollar was weaker again today. The XAU rose 2 3/4. ABX and GG gained 2/3, while NEM was up a buck. Volume was lighter than the previous 2 days. I had another open order in for some February ABX calls but it wasn't filled and I canceled it. Any kind of pullback or weakness in the gold share calls can be bought in my opinion. I will try and do that next week if I get a chance. I noticed today the volume in the February 50 call strike price for ABX went through the roof. Perhaps that will be the proper choice here. We'll see. Mentally I'm still trying to forget the fact that I missed this explosive move in the gold share calls when I was right there trying to take advantage of it. Obviously improvement is needed. But like I said before, there still may be a chance to make some profit from it. I think the overall market is beginning to signal a change but I could be wrong there as well. It's been an interesting week but now it's time for a break. I'll be going over the charts this weekend and hopefully I'll come up with some type of solid game plan for next week.

2012-01-26T13:22:00.000-08:00

We had a one day reversal today as we opened higher and closed lower. The Dow lost 22 points on average volume. The advance/declines were about even. The overall market was weaker than the Dow today and that's the second time we've seen that here lately. No technical damage has been done to this extended rally in the indices but we're beginning to see signs that it's getting tired and may need a rest. February more often than not is a bit weaker when we are in a rising market. GE lost a touch after opening higher as well. Yesterday it looked like we were going to break out to the upside from the congestion zone. Today we are simply still in the zone. Perhaps the GDP report tomorrow will change things. No trades in GE for now but perhaps the March option cycle. Gold continued higher, adding on to yesterdays gains by $25 on the futures. The US dollar was a bit weaker today. The XAU rose 2 1/4. ABX up 1/2, GG tacked on 1 1/8 and NEM added 1/4. Volume was good. I left in an open order for some gold share calls overnight but it wasn't filled. I'm leaving in another open order for some ABX February calls overnight. Since we've seen a valid breakout in gold, I would expect further gains in the gold shares. The timing is late though. Mentally I'm feeling OK, slept good enough. The rally continues in the stock indexes but I think we are beginning to see signs that it is long in the tooth. I could be wrong but we have remained overbought for a very extended time. Gold has broken out and will move higher in my opinion. We'll wrap things up tomorrow and go from there.

2012-01-25T13:16:00.000-08:00

The Fed spoke and the market listened as the Dow rose 83 points today on average volume. The advance/declines were 3 to 1 positive. Overbought for weeks now and no sign of a top. I really don't know how long this can go on but I do know this. It will probably last longer than you think and it already has. Summation index continues higher. So the scenario remains the same for now. GE was up 30 cents on OK volume. We're still in the recent congestion zone here but it now looks like GE wants to break out to the upside. I don't have any trades here in mind for GE though. Gold was one of the stories of the day as it rallied $35 dollars on the futures and another $10 in the aftermarket on the Fed. The US dollar fell in reaction to the continued easy US monetary policy. The XAU exploded to the upside by 11 1/3. ABX and GG were both up 3 and NEM rose 2 3/4. Volume was heavy. I placed an overnight order in for the ABX calls but it wasn't filled. I am leaving in an overnight order in for some GG calls in hopes of a pullback. But it probably won't come tomorrow. I do not like to chase moves however in this case price and volume have broken out and that can't be ignored. In retrospect the Gold/XAU ratio was close enough to justify purchasing the gold share calls. The gold exchange traded fund GLD has broken through the downtrend line that has been in effect since September. The next technical expectation would be a pullback towards that line. That will be the point to purchase the gold share calls after missing this opportunity. Mentally I'm feeling a bit miffed for missing the gold share call trade. However the market doesn't care and really, neither should I. But I don't like missing out on decent trades more than I don't like losing money. It doesn't matter though as the game goes on and there will always be another trade. You've got to keep moving on. I'm going to try the gold share calls anyway if I get the chance. I'm also considering some OEX puts for February if we get some sort of RSI or momentum signal. Hasn't happened yet but I'll be looking for that as we go into February. Plenty of economic data at the end of this week but the Fed announcement may trump any of that. We'll see.

2012-01-24T13:14:00.000-08:00

We opened lower today and tried to fight our way back but the Dow closed with a loss of 33 points on light volume. The advance/declines were positive. The overall market was stronger than the Dow. Still overbought and still no real pullback. The summation index continues higher. We'll get a Fed announcement tomorrow and that may move things. GE was down 1/8 on light volume. We've been moving sideways here for about 3 weeks. No trades there for now. Gold lost $13 as the US dollar was a bit higher. The XAU lost 3 2/3. ABX off 1 1/2, GG fell a buck and NEM dropped 1 3/4. Volume was average or better. NEM has been the leader for the gold shares and we are setting fresh lows there. Oversold on the gold shares and almost at the Gold/XAU ratio buy signal. It's possible that both gold and the gold shares will decline together. Regardless, I'm going to give the gold share call trade a shot this week if the signal comes through. Mentally I'm feeling tired, did not sleep well. The overall market is overbought and I expect some weakness this week. Today was not a real decline in my opinion. The overall market was too strong. So we'll get through the Fed announcement tomorrow and go from there.

2012-01-23T13:28:00.000-08:00

A quiet start to the week as the Dow lost 11 points today on light volume. The advance/declines were positive. Nothing new to report really. We've got the Fed this week and that may be the highlight. Still overbought and I'm looking for some type of pullback this week. But we'll need a catalyst for that and I have no idea what that will be. So we wait. GE lost about 1/4 on light volume. No trades there in the near future. Gold continued higher, up about $14 on the futures. The US dollar was weaker today as the euro has begun to move higher. The XAU was up 3 points. ABX gained 1 1/8, GG rose 3/8 and NEM was flat. Volume was average. I'm looking to get long the gold share calls this week on weakness if it happens. May be too late already. The gold share calls are oversold on the technicals. We don't have the Gold/XAU buy signal just yet. If and when that signal occurs we will have a decent risk/reward to put on that trade. I'm looking at the February ABX or GG calls. ABX has shown the best relative strength lately. We'll see. Mentally I'm feeling OK. A new option cycle started today so the premiums are higher than I'd like. That said, if a trade looks good this week I'm going to give it a shot. Tomorrow could be another waiting on the Fed day. More economic data out later this week. I'll try and be patient here on the gold share calls because gold itself is pretty overbought. Gold is also approaching a downtrend line that could prove to be resistance. We'll watch what happens overseas tonight and go from there.

2012-01-20T15:07:00.000-08:00

Onward and upward we go as the Dow gained 96 points today on average volume. The advance/declines were positive. Something changed today however as the overall market was much weaker than the Dow. Perhaps this is a divergence worth paying attention to. Or not. It could just be a byproduct of the option expiration today. But it is worth mentioning since this is the first time in a while that we've seen it. Still very overbought on the technicals for the stock indices. This won't last forever. GE came out with its earnings this morning and the stock sold off. However it came all the way back during the course of the trading day to finish unchanged. Volume was heavy. The technicals on GE mirror the overall market. Overbought, staying there and it is overdue for some pullback. Gold was up around $10 on the futures, while the US dollar ended the session practically flat. The precious metal has held up rather well here and is overbought as well. The XAU fell a point though as the gold shares are not following the metal itself. ABX down 2/3, GG gained 1/2 and NEM lost 1/3. Volume was heavy in the gold shares. ABX came out with what was viewed as bad news, in the same manner as NEM did on Tuesday. The technicals on the gold shares are getting oversold. I'm getting a possible positive RSI divergence on one of my ABX charts. The Gold/XAU ratio is almost to the buy signal. So it's possible the time to get the February gold share calls is upon us. The only caveat is that gold itself is overbought. Mentally I'm feeling OK. Still moving higher on the stock indexes but we are both short and medium term overbought. That hasn't stopped us from going up but at some point it will. The question is when? The gold shares are looking interesting to me and I think that next week I'll be giving the February calls a try. We'll see. I will have to check the charts over the weekend and take it from there. For now it's the end of another trading week and time for a rest.

2012-01-19T13:11:00.000-08:00

Moving ahead is what we continue to do as the Dow gained 45 points today on average volume. The advance/declines were almost 2 to 1 positive. The overall market remains a bit stronger than the Dow. There is nothing new to report as the grind higher remains in place. We'll have to wait and see what happens after the option expiration tomorrow. GE was up 1/8 on average volume. Earnings out tomorrow morning and perhaps the Dow will take its cue for the day from that report. No trades in mind there even after the numbers are released. Gold fell $5 on the futures despite the weaker US dollar. The XAU lost 3 1/8. The gold shares have shown weak relative strength here, related to gold itself and the overall stock market. Not sure if it means anything. ABX off 1 1/2, GG down 1/2 and NEM lost 3/4. Volume picked up to the downside. The Gold/XAU ratio is moving in the right direction to offer a buy signal but it might take a few more days. The technicals on the gold shares have rolled over. If and when we reach oversold here will be the time to attempt the gold share calls. That looks as though it will likely be the next trade. Mentally I'm feeling tired, did not sleep well again. It has been a good bullish run for the stock indices and there seems to be no end coming to it in the near term. Calls have been and continue to be the way to go. I'm not exactly sure what is going on with the gold shares here and it will bear keeping an eye on things. The disconnect amongst the shares with the US dollar, gold itself and the stock market strength is puzzling. Perhaps things are weaker here than I think. We'll see. Let's get through Fridays expiration and go from there.

2012-01-18T19:08:00.000-08:00

Another day another gain as the Dow rose 96 points on average volume. The advance/declines were about 4 to 1 positive. Overbought, staying there and higher we go. Summation index still moving up. The January option cycle has been pretty good for the calls. 2 days to go before expiration. Nothing in the way of more gains at the moment. GE was up 1/4 on average volume. We'll see what happens when the earnings arrive on Friday morning. Gold was up a few bucks on the futures as the US dollar lost ground again. The XAU was up 1 1/4. ABX and GG were off a nickel, while NEM shed 1/2. Volume was average. I'm still considering the gold share calls for the February option cycle. Mentally I'm feeling tired, did not sleep well or enough. The stock indexes continue to be positive and you cannot fight the trend. We've had a good run since the middle of December. The only question is how long will it last? My guess would be longer than expected. Gold hasn't reached its downtrend line yet. When it does it may be a place to short it. However it also may be the spot where gold simply takes a rest before moving higher. Right now I'm believing the latter scenario. We'll see what happens when we get there.

2012-01-17T13:02:00.000-08:00

Still moving higher although we closed off of the best levels of the day as the Dow gained 60 points on light volume. The advance/declines were positive. We opened up over 100 points and then had a steady erosion throughout the day. No real news to report. The technicals remain the same. There is nothing to suggest at the moment that we just won't continue to grind higher. GE was off 1/8 on light volume. There is really no need to attempt to trade ahead of the earnings that are due Friday morning. The technicals remain overbought as they have been for weeks. The risk of attempting a short term trade here is too high. I will try and remain on the sidelines with regards to GE for now. Gold had a good day, the futures gained over $20 as the US dollar was weaker today. However the gold shares did not follow, as the XAU lost 3 points. ABX and GG lost about 1/3 or so. NEM was the big loser, off 2 1/2. Volume on the gold shares was average to good. Not exactly sure what is going on here but I'm still considering the gold share calls for February as my next trade. If and when the technicals get oversold and the Gold/XAU ratio flashes a buy signal. Patience is required. Mentally I'm feeling OK. 3 days left in the January option cycle and I have no trades in mind. I'm still of the belief that expiration week will have its usual positive bias. After that, who knows? Plenty of economic data out in the next couple of days and there's always the possibility of some type of headline out of Europe. We'll look for the markets reaction to the numbers and news. Take your cues from there.

2012-01-13T20:14:00.000-08:00

It was a down Friday the 13th today but it could have been worse. The Dow fell 49 points today on light volume. The advance/declines were almost 2 to 1 negative. We were down over 150 points this morning but came back. Worries about Europe surfaced once again. However this market is resilient. It does not want to go lower in my opinion. It will continue to grind higher next week is my thinking at the moment. It had every reason to sell off hard today but it did not. GE was off a touch on light volume. Maybe I will try the January calls before the earnings in a week. The strike price at 19 might work. Gold was lower today, off about $15 in the futures. We made a comeback here as well in the aftermarket even with a stronger US dollar. The XAU fell 2 1/4 but was even lower early. ABX, GG and NEM were all down 1/2 or so on light volume. I'll have to go out to the February option cycle for the gold share calls if that is what I decide for the next trade. It's possible today was the day to do that. Mentally I'm feeling OK. Still overbought on the stock indexes here but I don't see any big downside anytime soon. Expiration week should have its usual positive bias. I could be wrong depending on what transpires over the long holiday weekend. I'll check the charts and try to come up with some type of game plan for next week.

2012-01-12T15:09:00.000-08:00

Still chugging ahead as the Dow gained 21 points on what now passes for average volume. Nothing out there yet to derail this train. The advance/declines were positive. Volatility has disappeared as the days follow the same lower in the morning, higher in the afternoon routine. Sooner or later we'll pop one way or the other. Overbought, staying there, summation index moving higher. I've been writing the same thing for quite a while. GE was up a nickel on lighter volume. Will I try the January calls here before the earnings next Friday? That's about all there is left to do here. It's probably wiser to pass but that probably won't stop me. Gold was up another $8 today on the futures as the US dollar was lower. The XAU gained 2 points and is up against its 50 day moving average on the daily charts. ABX was flat, while GG and NEM rose 3/4. Volume was average for lately. I'll try the gold share calls if we get some weakness. They've already risen pretty good from the recent lows. Mentally I'm doing OK but could have slept better. We've got Friday ahead of a long weekend coming up tomorrow. I don't foresee any changes from the recent grind away higher pattern. I might look at the OEX puts here since we have been overbought for days. It would have to be a very short duration trade though because the trend is definitely up. I'll ponder things overnight and take it from there.

2012-01-11T13:03:00.000-08:00

We continue to grind away with an upward bias as the Dow lost 13 points on average volume. The advance/declines were positive. The overall market was stronger than the Dow. The Fed beige book came and went with nothing new. The technicals remain the same, overbought and staying that way. There is nothing to suggest any changes are forthcoming. Summation index moving higher. We are due for some pullback but I don't expect anything drastic. GE bounced back today on lighter volume. It gained 1/8. I'm looking at the January calls for perhaps a trade before the earnings report but it would be very risky. It is probably wiser to look elsewhere. Perhaps the OEX instead. Gold continued to the upside by $8 on the futures and a touch more in the aftermarket. The US dollar had a strong day but that did not deter gold. The XAU gained 1 1/3. ABX, GG and NEM all had fractional moves to the upside on light volume. It looks like I will have to hold off on buying the gold share calls for now. I need to see some weakness here and it just isn't happening. I think that it is too late to chase this move but I could be wrong. Mentally I'm feeling tired, did not sleep well or enough. The song remains the same for the stock indices. The technicals have been overbought for weeks. Yet we continue higher. Gold and the US dollar have both shown strength in the last week or so and that isn't the normal relationship between the two. No real bad news out of Europe and that has helped us move higher. 2 trading days left in the week before a long holiday weekend.

2012-01-10T19:31:00.000-08:00

We moved to the upside from the recent sideways congestion, as the Dow gained 69 points on average volume. The advance/declines were 3 to 1 positive. We're still overbought and the summation index is still moving higher. I really don't see anything that would stop the market from going higher. However I think it will be more of a grind than a dramatic move up. We won't remain overbought forever. Fed notes tomorrow. GE lost 1/8 on better volume. When the market opened up over 100 points, GE showed a little strength and then started to lose ground. It did not participate in todays rally. To me, that was a warning sign. I dumped the GE calls early. That trade lasted for quite a while and the return was 800%. That's not a typo. Maybe GE will lead the market lower here but I certainly don't know. It's a nice trade to begin the new year but the next trade is all that matters now. Gold was up about $25 as the US dollar fell again today. The XAU rose 3 2/3. ABX up 2/3, GG added 3/8 and NEM higher by 1 1/8. Volume was average. Looks like I am too late for the gold share calls but I will keep them in mind. Mentally I'm doing OK but not feeling well. No solid technical signals at the moment for what I'm following. 7 days left in the January option cycle. Probably a good time to be patient. We do have the GE earnings announcement on expiration Friday. Probably too risky to try anything there but we'll see. No OEX trades in the works at the moment. We'll see if we can build on todays gains tomorrow.

2012-01-09T13:01:00.000-08:00

A fairly quiet start to the week as the Dow gained 32 points on light volume. The advance/declines were positive. Summation index continues higher. The trend is up and we're overbought. That has been the case since the year started. Won't go on like this forever but we continue to grind higher. The news out of Europe today was a non-event for a change. Perhaps the Fed beige book on Wednesday will bring some decent market movement. Or not. GE was up another 1/8 on light volume. I again placed a stop limit order for the day but we never came back to it. Still overextended on the technicals for GE but I continue to hold on as we grind higher here as well. Pretty sure I'll be selling the calls this week. The uptrend line on the daily charts from the beginning of December is still intact. Gold fell a bit today despite weakness in the US dollar. The yellow metal was down around $8 on the futures. The gold shares were mixed with ABX up 1/4, GG rose 3/4 and NEM fell 1/2. Volume was light. I'm still considering some gold share calls for February. The technicals are more overbought than oversold though. So we'll see. Mentally I'm feeling OK, slept good enough. The stock indices have been drifting for about a week with overbought technicals. Not exactly sure how that is going to play out. GE continues to show excellent relative strength and that is one of the reasons for holding on to the calls for so long. However this trade has only 8 days to go before option expiration. Plus the earnings are due on expiration Friday. The risk increases with every passing day but that is always the case in this game. We'll check what the overseas markets do overnight and take it from there.

2012-01-06T15:21:00.000-08:00

The employment report came and went as the Dow fell 55 points on light volume. The advance/declines were negative. The jobs report was a bit better than expected but the market did not rally. The overall market was stronger than the Dow once again. We're still overbought and staying there. The summation index continues higher. Where we go next is the question as usual. I'd like to see one more pop to the upside but of course I'm holding calls at the moment. I have no idea what next week will bring. Some economic data and the Fed beige book will be out. GE was up 1/8 on average volume. I placed a stop loss order here for the day but it wasn't hit. The GE calls I own are still in the black. The relative strength of GE continues to be strong but I can't hold on to these options forever. They will probably be sold next week. At least they should be. Overbought both short and medium term here. Gold fell a couple of bucks on the futures as the US dollar continues to move higher. In fact it's a mystery to me why gold hasn't dropped this week with the US dollars strength. The XAU fell 1 7/8. ABX off 1/2, GG down 1 1/8 and NEM dipped 1/8. Volume was light. I'd still like to get some gold share calls but not exactly sure about the timing at this point. Perhaps next week. ABX has been showing the best relative strength but there is no guarantee that continues going forward. Mentally I'm a bit tired, did not sleep enough. Both the stock indices and gold have moved higher this week despite the rise in the US dollar. That is the opposite of what you would expect. I don't know why nor do I know how much longer that abnormal relationship can go on. I'm still going to look for higher prices in the beginning of next week for the stock indexes. That could give me an opportunity to dump the GE calls. That is my game plan as of now, subject to revision over the weekend. It's the first Friday afternoon of the new year and time for a break.

2012-01-05T13:34:00.000-08:00

The Dow tried to sell off this morning but once again came back and finished the day with a loss of 2 points on average volume. The advance/declines were positive. The overall market was stronger than the Dow, which leads me to believe higher prices are in the near future. Summation index still moving higher. All eyes will be on the employment report tomorrow. No idea what that holds. The stock indices are still overbought and staying there. This condition won't last forever. No OEX trades in mind at the moment. GE was flat on the day. Volume was light. I've been holding the GE calls for quite some time. They remain in the black. I'm thinking that I will sell them tomorrow or in the beginning of next week. I don't think there will be a big decline here but what do I know? 2 weeks left in the January option cycle after tomorrow. Gold was up another $7 today and a touch more in the aftermarket. This, despite a huge rally in the US dollar. Money poured out of gold in December and now in January it is coming back in. The XAU was off 1/3 today. ABX, GG and NEM had fractional moves one way or the other on light volume. I may go out to the February option cycle if I give the gold shares a try here. I did notice some huge volume and open interest expansion in the ABX February $52.5 calls. The relative strength of ABX has been strong at the beginning of the year so far. However it's also possible that I'll try the GG calls. Not sure why gold hasn't dropped with the strength of the dollar. There are Middle East rumblings again. The gold share technicals are getting overbought short term but not on the medium term. I'd still like to see a near term pullback before purchasing some calls. May not happen. Mentally I'm feeling OK, slept good enough. Waiting on the data tomorrow and the markets reaction to it. I'm leaning towards higher prices after todays market action. That's a guess as usual. Anything could still come out of Europe at any time. So we'll see what happens.

2012-01-04T13:07:00.000-08:00

The Dow continued higher today but without a lot of conviction. The most watched index rose 21 points on light volume. The advance/declines were about even. We're probably in a wait and see mode until the employment report on Friday. Overbought and staying there. The summation index continues higher. GE was up an 1/8 or so on light volume. I don't know how much longer I'm going to hold on to the GE calls. Overbought on a daily and weekly basis. Possible negative divergence on the daily RSI. Gold continued higher, up a dozen points despite a higher US dollar. The XAU was flat. ABX up 3/4, GG off 1/3 and NEM down 1/8. Volume was light, with the exception of ABX. ABX has been the leader here to the upside. I still might try the calls there if we get some pullback. Not extremely overbought yet. Mentally I'm feeling tired, did not sleep well. Not a lot of action in the stock indices today. The overseas markets were generally weaker but the Dow was resilient. That has been the case lately. We'll see how long that lasts. Gold has had a nice bounce and I still think we could move higher. Need some weakness there to get long. I expect tomorrow to be a non-event in the markets. I've been wrong before and often as well.

2012-01-03T13:05:00.000-08:00

We started the new year to the upside as the Dow gained 180 points on what looks like light volume. The advance/declines were 3 to 1 positive. We were higher on the day but could not hold onto the earlier gains. Although we were up, I don't like the action. The transports came well off of their highs. I would have liked to see the Dow close near its high for the day. If we have another solid up day tomorrow, then I will feel better about the market moving forward. If not, than I'm not so sure. The technicals are overbought but could stay that way. We had some Fed news today but it wasn't really a market mover. GE was up 1/2 on average volume. Still overbought here and we closed off the highs as well. If we move lower here we will have a negative RSI divergence and that will not bode well for higher prices in GE. My GE calls are still in the black but I will have to think hard about getting rid of them sooner rather than later. We'll see. Gold was one of the stories of the day, up over $30 on the futures. The US dollar was fairly weaker on the day. The XAU gained 8 2/3. ABX up 2 1/4, GG rose 1 1/4 and NEM higher by 2 bucks. Volume was good. Money is coming back into the gold shares and it is probably too late for the January calls here. Any pullback can be bought short term in my opinion. I don't like missing moves but we never got the Gold/XAU ratio buy signal, although we did get a positive RSI divergence. Also had a bullish candlestick pattern at recent support on ABX 2 days ago. Sometimes you miss. Mentally I'm feeling OK. Tomorrow could be key and I'd like to see more upside in the stock indices. If not, decisions will have to be made. Some economic data out this week but all eyes will be on the employment report due Friday. We cannot forget that it is still an event driven atmosphere. Any news out of Europe could move this thing one way or the other. It's a risky environment. More overbought than oversold on the stock indices here as well. Plenty to ponder. Gold has had a nice bounce here as the year starts. Is it for real or just beginning of the year money flows? Time will tell. We'll see what tomorrow brings.

2011-12-30T15:43:00.000-08:00

We ended the year on a down note as the Dow fell 69 points on holiday light volume. The advance/declines were negative. No real news of the day or anything else to report. All the players will be back next week after another long weekend. GE was off 1/8. I'm carrying the GE calls that I own into the new year. That was the plan and I'm sticking to it. I'm expecting the stock indices to move higher in the beginning of 2012 and GE should go along for the ride. GE's earnings come out on January expiration Friday but I won't be holding them that long. At least I hope not. Gold had good day, up $25 on the futures and it was higher than that during day. The US dollar was weaker. The XAU was up only 1 1/4 though. ABX was flat, GG up 3/4 and NEM fell 1/3. A mixed bag to be sure. Volume was light. I'm pretty sure that I'm going to try the gold share calls in the beginning of January. I just need to see a decent signal in the Gold/XAU ratio. We'll see if that happens. Mentally I'm feeling OK. Today puts a close to the 2011 trading year. My trading account gained about 65% for the year. It should have been better and it could have been worse. At least it wasn't a repeat of last years debacle. But it really doesn't matter. Win or lose, it's over and done with. The only thing relevant now is the trading for 2012. You have to keep trying to move forward in the game and sometimes it isn't easy. The only thing that I can say for sure is that you've got to keep doing the work. Day in and day out. Week in and week out. Month in and month out. Year in and year out. There are no shortcuts. Do that and you might have a chance. Don't do it and your doomed. My general scenario at the moment is to be looking for strength in the stock indices at the beginning of the year. That should give me an opportunity to dump the GE calls. I'd also like to try the gold share calls for the January option cycle as we still have three weeks to go there. That's about all on my radar screen for now. We're still subject to headline risk out of Europe with their ongoing debt problems. Trouble there could pop up at any time. However for now it's the last Friday afternoon of 2011 and time for a rest. Here's wishing everyone a prosperous trading year in 2012.

2011-12-29T13:22:00.000-08:00

Back to the upside today as the Dow gained 135 points on holiday light volume. The advance/declines were almost 4 to 1 positive. We had the opposite of yesterdays action today. I don't think that it means much in the overall scheme of things. Just trying to muddle through this light volume week. I still think we will be going higher in the beginning of next year. GE gained 1/4 and we're still overbought here. Nothing much to do with the calls here but to wait for next year. Gold was the story of the day again as it fell almost $25 on the futures. Came back a bit in the aftermarket. The US dollar was a bit weaker today. However the XAU rose 3 points. ABX, GG and NEM were all higher by 7/8. Will the gold shares lead the precious metal higher? Don't know. There is a positive RSI divergence with ABX on the daily charts. The Gold/XAU ratio isn't near a buy signal here though. I would like to try the gold share calls and perhaps next week will present an opportunity. We'll see. Mentally I'm feeling tired, did not sleep enough. Just waiting for the week to end. Tomorrow should be a non event.

2011-12-28T13:08:00.000-08:00

Moving lower today as the Dow lost 140 points on light volume. The advance/declines were 4 to 1 negative. Bad news out of Europe this morning, at least that was the perception. The market is still hostage to the headlines as it has been for quite some time. Working off the overbought condition in the stock indices is my take on things at the moment. I could be wrong as usual. It's still a holiday mode market until next week. GE was off 1/8 on light volume again. My GE calls are losing ground but I'm still holding on until next year. That has been the plan and I'm sticking to it for now. Gold took another hit today, the futures were off $30 and fell another $10 in the aftermarket. The US dollar rose on the weaker European debt perception. The XAU was off 6 1/3. ABX down 1 1/4, GG off 1 2/3 and NEM dropped 2. Volume picked up to the downside. Could be the final tax-loss selling for the year or we could be starting another leg down in gold. Not sure but I still would like to try the gold share calls again early next year. Haven't gotten the Gold/XAU ratio signal yet but we are getting close. Trying not to do anything this week. Mentally I'm feeling tired, did not sleep well. Just hanging around for the rest of the year. Light volume skews the moves this week. Markets are in holiday mode. 2 trading days to go.

2011-12-27T13:18:00.000-08:00

A slow holiday trading session as the Dow lost 2 points on very light volume. The advance/declines were about even. I'd expect more of the same for the rest of the week as we are in holiday mode. I think there will be a downside bias, since we are short term overbought. I do not expect a lot of news out of Europe or anywhere else this week. GE dropped about 1/4 on light volume. My GE calls are still in the black. I would expect some weakness here as well and that would relieve the overbought condition that we're in for GE. I still will be holding this trade into the new year. Gold fell $10 on the futures today and the US dollar dropped a touch. The XAU lost 2 1/2. ABX and NEM fell 1/2, while GG shed 2/3. Volume extremely light. I am looking at the gold share calls again for January. Oversold and staying there for the gold shares. When the Gold/XAU ratio hits the buy point, I will give this trade a shot. Mentally I'm feeling OK, it was a nice long break from the trading action. Not much to do but get ready for next year at this point. I'll be keeping an eye on things but I don't expect any surprises this week. I expect some drift lower, that's about it.

2011-12-23T13:03:00.000-08:00

The Santa Claus rally lives on as the Dow gained 124 points today on very light holiday volume. The advance/declines were 2 to 1 positive. Summation index moving to the upside, implying higher prices going forward. Trying to get through overhead resistance here on the stock indices but the volume is light. The Dow is the leader right now and that usually isn't bullish. I'd like to see the small stocks take the lead but it hasn't happened. Overbought on the stock indexes. GE gained 1/8 on light volume. Very overbought here and some pullback would be healthy for going forward in January. My GE calls remain in the black and we've hit the initial target that I had in mind. I'm holding on until next year for now. Gold dropped a few bucks on the futures in quiet trading. The US dollar was basically flat on the day. The XAU gained a point. ABX up 1/8, GG rose 3/8 and NEM tacked on 7/8. Volume was extremely light. Oversold, staying there and perhaps next week I'll try the gold share calls again. We'll see. Mentally I'm feeling OK, slept well. All was pretty positive for the stock indices this week except for the low volume. The trend is up. Gold just hung around all week after its recent debacle. Probably more of the same is in store there. A long holiday weekend is on tap and next week should be slow too as we wait for the new year. It's the first Friday afternoon in winter and time for a break.

2011-12-22T13:03:00.000-08:00

Moving to the upside as the Dow gained 62 points on light volume. The advance/declines were 3 to 1 positive. The summation index is now moving back to the upside. It looks as though the Santa Claus rally has begun. Of course it could all turn around tomorrow if something negative comes out of Europe. We are right at resistance lines on the major stock indices, below them on the small stocks. We would have to get through them on good volume to continue higher in my opinion. I'm still a believer in higher stock prices going forward. GE continues to amaze as it gained 3/8 today on good volume. We have reached what was my target at $18. I'm going to continue to hold onto the calls into next year as I originally planned. GE is very overextended here and some type of pullback would be helpful for continuing to hold on. However with the price moving higher on good volume, the trend is clearly up. The GE calls I have are still in the black and continue to gain ground. Gold lost a few bucks in the futures and 5 more in the aftermarket. The US dollar bounced around and finished the day about where it started. The XAU fell 1 1/4. ABX and GG lost 1/3 but where lower during the session. NEM dropped 1 7/8. Volume was light. I'm still looking at the January gold share calls but that is about it. I don't plan on attempting this trade until a decent signal presents itself. That is the plan. The gold shares are pretty oversold and staying that way. Mentally I'm feeling tired once again as I did not sleep well. Tomorrow is a Friday before a long holiday weekend and I would not expect any big moves. It should be a slow affair. Next week should be about the same. Unless something occurs in Europe. If that is the case, anything could happen.

2011-12-21T13:07:00.000-08:00

We were negative for most of the day but came back by the close to finish with a gain of 4 points on the Dow. The advance/declines were positive and the volume was light. Today the headlines out of Europe weren't viewed as favorable, hence the weakness. So back and forth we go. I still feel that higher stock index prices are in the future, with the future being the next few months. The smaller stocks didn't do well today and they are usually the leaders at this time of the year. On the other side of the coin, the transports are just about to break their overhead resistance. If that happens it will be bullish for the overall market. GE continues to show incredible relative strength in my opinion, up 3/8 today on good volume. And I'm not just saying that because I own some GE calls. GE could be a harbinger of better stock prices going forward as well. Still very overbought here short term. We are approaching the price target that I had in mind for this trade. May have to readjust expectations. The calls I have are still in the black. Gold was down $4 on the futures today. The US dollar was a bit higher. The XAU was flat. The gold shares were mixed, with ABX and NEM showing fractional gains. GG lost 2/3. Volume was light. I'm still trying not to put on a trade here yet. I'm waiting for the signal from the Gold/XAU ratio, if it happens. Plenty of time in the January option cycle with the extra week tacked on. There are 3 days off for holidays though. Mentally I'm feeling tired, did not sleep enough. I would expect some drift here for the rest of the week as we approach the Christmas holiday. It's a time to be patient in my opinion.

2011-12-20T13:02:00.000-08:00

Positive headlines out of Europe led to a rally today as the Dow gained 335 points on light volume. The advance/declines were about 7 to 1 positive. It remains a headline driven market environment. We were short term oversold on the stock indices though. We'll have to see if there is any follow through tomorrow. It certainly isn't the quiet pre-holiday week that I expected. It's possible that the summation index will turn around with more positive activity this week and that would be bullish. Hasn't happened yet. GE was up 3/8 on light volume. We remain overbought here. That won't last forever. My GE calls are still in the black. Haven't yet reached the target that I have in mind and I would like to hold this trade into the new year. That is the current and ongoing game plan. Gold found some buyers today as the US dollar took a hit. Gold was up $20 on the futures. The XAU gained 6 1/3. ABX and NEM were up 1 1/2, while GG rose 1 1/8. Volume was light. We never fully reached the Gold/XAU ratio buy signal yesterday but it was close. We'll have to see were we go from here. The technicals are still oversold on the gold shares, even with todays action. I'm trying to hold off on buying some gold share calls here. We'll see. I would like to see some sideways consolidation after the recent downdraft in gold before trying the calls here again. Mentally I'm feeling OK. So we had a nice up move in the stock indices today and that at least fits in with my higher not lower stock price theory going forward. It could all change tomorrow though in this type of atmosphere. I'd like to see some follow through. I don't foresee any more trades for this year since there is nothing pressing on the radar screen at the moment. I'll try and remain patient here and not do anything stupid. Doesn't always work out that way.

2011-12-19T13:09:00.000-08:00

We started the week on a down note as the Dow fell 100 points on light volume. The advance/declines were 4 to 1 negative. Trying to hold the 50 day moving average in the Dow. We are moving toward the daily uptrend line that began in October. Whether or not that line holds will be the key. I do believe that it will but that doesn't mean that it will. Summation index still heading lower. Moving to getting oversold on the daily stock index technicals. I'd like to think that we are setting things up for a Santa Claus rally. GE fell 1/8 on light volume. GE is still holding up well compared to the overall market. Overbought here though and some type of decline is overdue. My GE calls remain in the black. Holding them until further notice. Gold bounced around today and ended up nearly unchanged. The US dollar had a slight gain. The XAU dropped 4 1/4. ABX fell 1/3, GG down 1 3/4 and NEM lost 1 1/8. Volume was average. The Gold/XAU ratio is almost at the buy signal and that is worrisome for me because I may put on another gold share call trade. Worrisome because gold and the gold shares have really broken down here and technical damage has been done. They could remain oversold for a while, in which case they will continue lower and buying the calls won't work. So I am going to try and remain on the sidelines and patient here. We'll see. Mentally I'm feeling tired, did not sleep well. I'm anticipating a slow week but it hasn't started off that way. As I said before, my thoughts on the markets lately have been way off. I am going to try and wait until next year to put on any new trades but you never know. We'll see what tomorrow brings.

2011-12-16T13:03:00.000-08:00

Another rally that fizzled, as the Dow fell 2 points today on heavy volume. We were up 100 early. The advance/declines were positive. The overall market was stronger than the Dow. We got through option expiration and now we are entering holiday mode in my opinion. I'm expecting less volatility and more drift. It's still a headline driven game for now but I do expect less of that until next year. I could be wrong and have been lately. GE was up about 20 cents on average volume. Overbought here now. My GE calls are still profitable. I'm a holder until next year until further notice. Gold had a bounce today, the futures were up 20 bucks. The US dollar dropped a bit. The XAU rose 2 3/4 but was higher early. ABX and GG were both up 80 cents, while NEM rose 1/2. Volume was average for lately. I don't think we will be getting a sustained rally in the gold shares yet. I still want to try the calls again but not now. I think that waiting for the Gold/XAU ratio to hit the buy signal would be prudent. If and when that occurs, along with oversold technicals, could be the point to try the calls here again. There is no rush for now. Mentally I'm feeling OK. It was a losing week for me as gold got slaughtered right after I purchased the ABX calls. As I said before, that is probably the last trade for me to put on this year. I expect things to quiet down into the new year as the holidays arrive. There's also an extra week in the January option cycle and the premiums are high. It's a time to be patient in my opinion. It's Friday afternoon and time for a rest.

2011-12-15T13:06:00.000-08:00

We tried to move higher today but didn't have much success. The Dow gained 45 points today on light volume. The advance/declines were positive. We bounced at the open and then drifted for the rest of the day. The market is still preoccupied with Europe and that isn't going away anytime soon. Summation index still heading down, implying lower prices. Option expiration tomorrow. The technicals on the stock indices aren't overbought or oversold. Perhaps drift is the best we can expect at this point. The economic data came out with what looks to be better than expected numbers. No OEX trades in mind at the moment. GE was up 1/8 on light volume. GE is holding up well here and the GE calls I own are still in the black. Gold continued lower today after yesterdays collapse. The precious metal fell about $10 on the futures and a bit more in the aftermarket. This happened despite the US dollar losing some ground today. The XAU was off 2 points. ABX lost 1/2, GG down 1/8 and NEM was up 1/8. Volume was average. I would expect some type of near term bounce in gold and the gold shares. If I hadn't just tried the ABX calls and lost I would probably try them again here. However my confidence is low. Mentally I'm feeling OK. Trying to put the ABX loss behind me. It really doesn't mean anything going forward. The next trade and managing the GE trade are what's important now. My ideas lately haven't panned out. So like I said yesterday, I'm probably done trading for the year. But you never know. The stock indices are drifting lower here and are approaching a 1 1/2 month uptrend line on a daily basis. Whether or not that line holds will be the key to near term direction. Gold has fallen out of bed and it will take some time to recover from that in my opinion. We'll see what kind of expiration we get tomorrow and then look forward to the weekend.

2011-12-14T14:09:00.000-08:00

Continuing lower today as the Dow lost 131 points on average volume. The advance/declines were over 2 to 1 negative. The technicals have rolled over, which isn't bullish. The dropping euro is todays excuse for the negative action in the stock indices. The positive action that I expected hasn't taken place. My take on things here has been wrong. However I'm still a believer in higher prices going forward. GE bucked the trend and was up about 1/4 on good volume. The GE calls I own are still in the black. I like the relative strength of GE here but anything can happen. I still plan on holding the GE calls until next year but everything is subject to change. Gold was the story of the day again as the futures collapsed by almost $80. The US dollar was higher once again. The XAU was off 5 1/4, which wasn't too bad considering the carnage in gold itself. ABX down 2, GG lost a buck and NEM fell 1 1/2. Volume was very heavy. Today could be the washout for the gold shares and a bounce would be due. However I simply dumped the ABX calls that I bought yesterday for a 45% loss. This is a trade that isn't going to work, even with a bounce. Another loser and I'll probably end the trading year on that note. Oversold and staying there for the gold shares. Technical damage has been done on the downside for gold and it will probably take a while to repair. Mentally I'm feeling OK. We are approaching a near term uptrend line in the stock indices, so we'll have to see if it holds. Summation index heading lower and that is not good for the long side. Expiration week has had a downside bias so far and it's usually just the opposite. GE is holding up well. Nothing positive to say about the ABX trade. Sometimes you're just wrong. Volatility has picked up and I didn't expect that either. My guess is that things would slow down as the holidays approached and that wasn't right either. We'll see what happens tomorrow.

2011-12-13T13:15:00.000-08:00

We got the Fed and the market didn't like what it heard. At least that is one of the excuses for todays drop as the Dow fell 66 points on average volume. The advance/declines were over 2 to 1 negative. We were up over 100 and down over 100 during the day as some volatility returned. Getting short term oversold. I did expect a decent up day early this week and haven't seen it yet. Perhaps my read of things is still off. Wouldn't be the first time. However I don't expect the stock indices to fall apart here and I'm still looking for higher prices medium term. GE lost a touch on average volume. My GE calls are still in the black but the profit has eroded so far this week. If GE is a proxy for the overall market again, then things may pan out as I expect. GE is holding up rather well so far this week. But there's still 3 days left before expiration. Gold was active to the downside once again as it lost $5 on the futures but got clobbered in the aftermarket to the tune of another $30. The US dollar broke out to new recent highs after the Fed announcement. The weakness in the Euro, the flight to safety and the relative strength of the US economy are helping the bullish cause for the dollar in my opinion. How long that lasts is anybodies guess. The XAU 6 points and broke a 2 month uptrend line. ABX off 1 1/4, GG lost 1 3/4 and NEM down 2 1/8. Volume increased to the downside and that could be ominous for getting long. Gold will have to have some kind of reversal by the end of the week or it will be breaking longer term uptrend lines that have been in place for years. That said, I was filled on the January ABX call order that I had in place. Not sure this is the proper trade for right now. I got the price that I wanted but it won't matter if we go into a free fall with gold. And that's what it looks like so far this week. So we'll see what happens. Mentally I'm feeling a bit tired, did not sleep well. Interesting action in the stock indices today and it doesn't look bullish. Todays action also should turn the summation index down. So maybe I'm wrong about prices going higher as we move forward. Time will tell. Gold acts like it's breaking down here as well. I'm in the ABX call trade now as well as the GE calls. We'll see what happens overnight in Europe and go from there.

2011-12-12T13:10:00.000-08:00

Today the market didn't like what it heard from Europe and we were down 162 points on the Dow. The advance/declines were 4 to 1 negative and the volume was pretty light. We were down over 200 for much of the day. I still think we will see higher prices going forward. I also think we will see a solid up day this week and sooner rather than later. That is what the technicals look like to me. I could be wrong. We've got the Fed this week, plenty of economic data and option expiration. Things could get volatile however the light volume today was interesting but it may or may not mean anything. I'm thinking that there weren't a lot of sellers. GE lost 3/8 on lighter than lately volume. My GE calls are still in the black but lost some ground today. I'm still holding them and plan to into next year. Gold was the story of the day as it got pummeled on the sharply higher US dollar. The yellow metal fell about 50 bucks on the futures but made a slight comeback in the aftermarket. The XAU declined 6 7/8 but we were lower. ABX and GG off around 2 bucks and NEM dropped 1 2/3. We were lower here as well, with volume average. I placed an overnight order in for some January ABX calls and it wasn't filled. I'm leaving the order good until canceled. Not sure this is the right trade to do but I'm willing to take the risk at the price that I want. There was some interesting volume on some of the ABX January calls. Also getting oversold now on the gold shares. We'll see. Mentally I'm feeling OK, slept good enough. We started the week to the downside on the stock indices and we'll see if we get any follow through. It still remains a headline driven environment. Gold took a huge dive as well as it looks like the US dollar could move to new recent highs. We are right on the cusp. We'll see what Europe does overnight and go from there.

2011-12-09T13:34:00.000-08:00

A bounce back to the upside as the Dow gained 186 points on light volume. The advance/declines were 6 to 1 positive. Europe announced another rescue plan as that saga never seems to end. Could it all change by Monday? Who knows? We're still overbought on the technicals for the stock indices but when we're in rally mode that doesn't matter as much. I still think we are going to see higher prices next week. We've got the Fed next week along with plenty of economic data. GE was up 1/2 on average volume. Overbought here as well. The calls I own are still in the black. Plenty of time left on this trade. Gold was up a couple of bucks or so on the futures as the US dollar fell. The XAU rose 2 1/2. ABX was up 1/4, GG lost a touch and NEM gained 7/8. Volume here was light. I canceled the open order for the January ABX calls. I'll probably try again next week. We aren't oversold yet on the gold shares. The ideal scenario would be some weakness next week as gold itself moves down to its uptrend line at about $1680. Of course the ideal scenarios rarely pan out. Mentally I'm feeling OK. Another factor to consider with trading at this point is the upcoming holiday period. Things will probably slow down. That usually doesn't bode well for the options as time premium gets taken out. It's something to consider. Expiration week is next week. I still think I'll try the January gold share calls at some point before the end of the year. Unless gold for some reason just falls apart here. I don't expect that to happen but we are getting near the long term uptrend line and there doesn't seem to be the interest that there used to be. So we'll see. I'm looking for higher prices in the stock indices next week. I'll continue to hold the GE calls. I'll check the charts over the weekend and go from there. For now it's Friday afternoon in the winter and time for a break.

2011-12-08T13:09:00.000-08:00

We got some downside today as the Dow dropped 198 points on average volume. The advance/declines were 6 to 1 negative. The rumblings from Europe are now that whatever they do tomorrow won't be enough. Or perhaps tomorrow everything will be OK. That is the kind of game we're playing at the moment. I have no idea what will happen, as usual. We're overbought on the stock indices, so some downside is to be expected. I do not think this is the beginning of a huge move lower. I still think that declines can be bought. However in this type of news driven environment anything is possible. That is what makes the trading even more difficult than usual. GE fell almost 1/2 on average volume. The calls I own are still in the black but lost some ground today. I'm still a believer in this trade and I intend on holding them for now. The idea is to remain in this trade until next year. We'll see. Gold fell today as the US dollar rallied. The precious metal was down around $30 on the futures. The XAU fell 6 2/3. ABX and GG slumped 1 1/2, while NEM dropped 1 2/3. Volume was about average for what we've seen lately. I did place an order for some ABX January calls and left it in overnight. If we continue lower this trade might get filled. The gold shares aren't completely oversold yet, so it may be early for this idea to work out. I'll readjust tomorrow. If the US dollar begins to rally now due to Europe, it won't be bullish for gold. Mentally I'm feeling OK. So we finally got the expected downside today. I really do not think that it will last too long. The technicals I look at are pointing to some decent upside at some point next week. But I could be wrong and often am. 6 days to go on the December option cycle. I do not foresee any short term trades before expiration but that could change as well. I'll check the charts again tonight and take it from there.

2011-12-07T13:08:00.000-08:00

The Dow continues moving higher as it continues to be overbought. We gained 46 points on the most widely watched stock index today on average volume. The advance/declines were positive. The overall market was weaker than the Dow once again. We sold off in the morning but the market just keeps chugging higher. There was news of yet another European bailout late in the session. I still think we need some pullback or consolidation but what do I know? Summation index is heading higher. Another European summit meeting on Friday, so that will be the market mover in a couple of days. GE was flat on the day with good volume. The GE calls are still profitable and there's still plenty of time to go. Gold gained around $13 today as the US dollar was flat on the day. The XAU was up 1/8. ABX was flat on the day, GG lost 1/8, while NEM was up 1/2. Volume was light. I thought about getting the ABX calls today. However we are mid range the technical indicators, with no actual buy or sell signal. There isn't a solid signal from the Gold/XAU ratio either. I would like to do this trade but it is probably better to wait. I could be wrong and often am. Mentally I'm feeling OK, slept well enough. 7 days left in the December option cycle and we are still in a headline driven market. I suppose the best course of action here would be to let Fridays European announcement happen and gauge the markets reaction. I'm still looking for some weakness before we head higher near term. I know that it sounds like a broken record but that is what the technicals look like to me at the moment. I'm going to wait on the gold share trade here and that might not be the right move either. Obviously I don't have a good handle on what is going on at the moment.

2011-12-06T13:03:00.000-08:00

The Dow gained 52 points today on light volume. The advance/declines were about even. The overall market was weaker than the Dow. We were up over 100 but fell back in the final hour. The short term overbought condition remains in place and we are moving to medium term overbought as well. Overdue now for some type of decline. I'm not saying it will be a dramatic drop like we saw recently but something to consolidate the gains and relieve the overbought condition. We'll see. GE rose 1/3 on good volume. There was some kind of analyst upgrade for the stock as the excuse for the rise. We've been kind of moving in a straight line up here on GE and that certainly can't last. The GE calls are still in the black and plenty of time left. I have a target in mind and we aren't there yet. Gold was down a couple bucks on the futures after being much lower. We rallied in the aftermarket. The US dollar bounced around and finished about unchanged. The XAU rose 3 1/3. ABX and GG were both up around a buck and NEM rose 3/4. Volume was light. May have missed the chance to get the calls here as we filled in the gap at $50 on ABX. However the Gold/XAU ratio is not near the buy zone and we aren't oversold as of yet. I would still like to try the gold share calls on weakness if we get any. Probably best to go out to January, since there are only 8 days left in the December option cycle. Mentally I'm feeling OK. It still looks to me as if we are putting in a minor top here on the stock indices and the Dow transports were negative today. They are sometimes a leader of the overall market. I have no OEX trades in mind for now but would consider getting some calls for expiration week if we see some near term weakness. However the short term trades are not usually my best efforts. I'm going to try and remain patient for the gold shares. We'll see what happens overseas tonight and go from there.

2011-12-05T13:08:00.000-08:00

Not sure what to make of todays action as the Dow gained 78 points on average volume. The advance/declines were about 4 to 1 positive. We were up about twice as high during the session. I would expect some type of pull back or consolidation here as we are short term overbought. However medium term I'm looking for higher stock prices and should plan my trades accordingly. Sounds good in theory. Not a lot of economic data this week so the headlines from Europe will drive the action. GE was up 1/4 on average volume. I'm still holding on to the GE calls and they're still in the black. Plenty of time left on this trade. Gold lost $16 on the futures and another $10 in the aftermarket. The US dollar lost ground as well. Perhaps the flight to safety trade is being taken off. That's a guess as usual. The XAU fell 7/8. ABX and NEM dropped around 3/4 and GG lost 1/3. Volume was light. I still would like to try the gold share calls for January at some point. However we aren't oversold here yet. So I'll try and be patient here. Mentally I'm feeling OK, could have slept better. The week has started off to the upside and we'll just have to see how long that will continue. Waiting on news from Europe later in the week. Gold was down today and the daily technicals are rolling over. We'll see what tomorrow brings.

2011-12-02T16:11:00.000-08:00

We opened higher and were positive for the whole day but by the close we were basically unchanged for the day. The advance/declines were positive and the volume was average. We were up over 100 points in the morning. The employment report was in line with expectations with a surprise drop in the jobless rate. We won't discuss how the government can massage the numbers. We only care about making money via trading. We are now short term overbought on the stock indices. Unless Monday is a solid up day, we are looking like a short term top is in place. Any weakness can be bought in my opinion. GE was up fractionally on average volume. My calls are still in the black. Gold was up $10 on the futures even with strength in the US dollar. The XAU however fell 5 1/2 points. I'm not sure what that's about. ABX and NEM were off 1 3/4, while GG lost 2 1/8. Volume was average. I would still like to get some January gold share calls but todays price action doesn't fit with what was expected near term. I will have to reconsider things as I look at the charts over the weekend. Mentally I'm feeling tired, did not sleep well or long enough. It was a very positive week for the stock indices. The summation index has not turned up just yet but I believe that it will soon. I think we could be lower early next week but I feel the trend has turned back up for the stock markets. I could be wrong. I'll be checking the charts over the weekend to try and come up with a game plan for the gold shares. The sun is setting on Friday afternoon and it's time for a rest.

2011-12-01T13:06:00.000-08:00

A day to digest yesterdays huge market gains as the Dow lost 25 points on light volume. The advance/declines were negative. We're getting short term overbought but if this is really a strong market, that won't matter much. I believe we are in another uptrend but subject to headline risk as is the usual lately. The employment report will be out tomorrow. I have no idea what that will bring but we will watch the markets reaction. No OEX trades in mind at the moment, perhaps some calls for expiration week. GE was flat on the day with lighter volume. The calls I own are still in the black. Still stuck at the 50 day moving average line here. Gold fell $10 in the futures but came back in the aftermarket. The XAU was off 2/3. ABX, GG and NEM had slight fractional moves one way or the other on lighter volume. I still want to get some gold share calls even after the recent run up. I'd like to see some pullback and we got very little today. Perhaps there will be an opportunity next week. Otherwise I'll just have to chalk it up as another missed trade. Hopefully that won't be the case. The US dollar was flat on the day. Mentally I'm feeling tired, did not sleep well. It's been quite a positive week for the stock indices so we'll see how we end things tomorrow. It's possible that the employment report could be another non-event as it has been lately. We'll see. I'll be keeping an eye on the gold shares for an entry point but like I said before, it will probably be better to wait until next week. On to tomorrow.

2011-11-30T13:08:00.000-08:00

It was an incredible day as the central banks around the world issued a joint statement that basically said we will flood the world with money. Perhaps that will solve the European debt crisis is what I think they were thinking. The Dow soared 490 points on heavy volume. The advance/declines were about 7 to 1 positive. Todays action might turn the summation index back to the upside. It's still a headline driven affair here for the stock indices but after today the trend has turned back to positive until further notice. You cannot argue with price and volume. GE rose almost a buck on good volume. We are back to the 50 day moving average line on the daily charts. The GE calls I own are now in the black. I plan on holding them until next year, so there is still along time left in this trade I believe. Gold rallied on the liquidity news as the US dollar fell. The yellow metal was up over $30 on the futures. The XAU climbed almost 13 1/2. ABX up 2 7/8, GG rose 4 and NEM gained 3 1/2. Volume picked up here as well. I again placed an overnight order in for some ABX calls but wasn't filled. I would still like to buy some gold share calls, even with todays huge upside. Resistance for ABX and GG is at $55. Once we get through that level, there is nothing to stop those issues from moving higher. Any type of pullback can be bought in my opinion. The problem being that there may not be any downside going forward. We may just rally straight up. I will be keeping an eye on these issues and will buy the calls on any weakness. We have already gapped up twice on the gold shares this week, so they are very strong. Hopefully one of those gaps will be filled. Mentally I'm feeling a bit frustrated by not owning any gold share calls at the moment. But who was to know what would transpire today? Why would the central banks choose today as the day to announce the liquidity flush? There was a valid Gold/XAU signal Monday morning but we opened at a gap up and I don't like to chase trades. Obviously should have in this instance. But hindsight is always correct and that doesn't plan the next trade. We'll watch Europe rally overnight and see what happens tomorrow. Beginning of the month of December. Will the employment report on Friday even matter?

2011-11-29T13:13:00.000-08:00

The Dow continued higher today with a gain of 32 points on light volume. The advance/declines were about even. The overall market was weaker than the Dow. We were in positive territory for much of the day. Working off the oversold condition but it doesn't look like some type of sustained rally yet. End of the month tomorrow. Still a headline driven marketplace. GE was up 1/8 on average volume. My calls here are in the red. No hurry one way or the other for this trade. Gold was up $5 on the futures as the dollar lost ground again. The XAU gained 1 1/2. ABX up 3/8, GG rose 5/8 and NEM was flat at the close. Volume was weak. I'd still like to try the calls for the gold shares but I'm trying to be patient. Perhaps if we take another leg down here, I'll get the January calls. We'll see. Mentally I'm feeling a bit tired, did not sleep enough or well. Kind of a blah day in the markets today. Perhaps the end of the month tomorrow will liven things up. Or we could be entering a period of wait and see as we head into December. The summation index is still implying lower prices for now. That could change with another strong up day. More oversold than overbought on the short term here for the stock indices. I'll keep an eye on GE and the gold shares and take it from there.

2011-11-28T13:00:00.000-08:00

A bounce was due and a bounce is what we got as the Dow gained 291 points on light volume. The advance/declines were 5 to 1 positive. I'm not sure it is anything more than just a bounce though. The same problems in Europe remain. The next headline will be the next market mover. This is the environment that we find ourselves in. Plenty of economic data out this week, including Fridays employment report. But it seems like nobody pays attention anymore as the focus remains the European debt problem. GE was higher early and then sold all the way back. It gained an 1/8 on average volume after being up 1/2. My GE calls are in the red. I plan on holding them until next year unless the bottom falls out. If GE is a proxy for the overall market again, the stock indices will be heading lower. Not sure if that is the case this time around. Gold had a good day as the US dollar dropped. The precious metal futures gained $25 on the day. The XAU rose 5 3/4. ABX up almost 2, GG higher by 1 1/4 and NEM tacked on 1 1/2. Volume was light as it has been lately. I did place an order for some ABX December calls overnight but it was not filled. I might try this trade again later in the week. The Gold/XAU ratio flashed a buy signal. If we get another one, I'll try this trade again. Mentally I'm feeling better but not 100% yet. We will have to see if the stock indices can hold up here. The summation index is still heading lower. I would like to see some type of positive divergence on the McClellan oscillator to be sure that the recent decline is over. That would be the ideal scenario. We will see if there is any follow through to todays price action tomorrow.

2011-11-25T12:59:00.000-08:00

A holiday shortened session couldn't keep the Dow from going lower as we lost another 25 points on the day. The advance/declines were negative and the volume was extremely light. We are very oversold and closed on the low of the week. Not sure how long this keeps up but a bounce is long overdue. GE was flat on the day after being higher early. Volume extremely light. Gold fell over $10 on the futures and the XAU lost 2 1/3. The US dollar had another good day. ABX fell 1/3, GG down 1/2 and NEM lost 3/8. Volume was nothing to speak of. The Gold/XAU ratio is on the cusp of a buy signal. I think that I may try the gold share calls on Monday. I will consider it over the weekend. Mentally I'm still not feeling 100%. I'm going to rest up over the weekend and go from there. I'll check the charts and decide what to do. I'm going to hold on to the GE January calls for a while. I will try and come up with a strategy for the gold share calls if that is what I decide to do. It's the middle of a long holiday weekend and time for a break.

2011-11-23T13:19:00.000-08:00

Another day, another downer as the Dow fell 236 points and closed on the low for the day. The advance/declines were about 8 to 1 negative and the volume was light. No buyers in sight despite the very oversold condition. Could be dangerous. Not to mention we have a holiday tomorrow and a shortened session on Friday. I suppose we will look to the European markets for direction but they are in the same free fall as the US. Summation index gapping lower and I have no idea why the market is dropping. Not sure where we are heading from here but the stock indices must know something. GE fell 1/4 on average volume. I adjusted the open order for the January calls overnight and it wasn't filled despite the downdraft. I then went back to my original order and was filled. Plenty of time on this trade but it won't work if we continue to head in a straight line down. Not sure this is the right thing to do but it was the idea and I still think it may be valid. Time will tell. Gold fell $6 on the futures and was lower early. The US dollar had a very good day in the flight to safety for whatever reason. So gold itself held up pretty good. The XAU did not as it fell 5 1/2. ABX lost 1 1/8, GG dropped 2 1/8 and NEM down 1 1/2. Volume was light. The Gold/XAU ratio is just about at the recent buy level. I'm not sure if I should try the December of January gold share call options. The premiums are still high for January. It's something to think about this weekend because I don't think I'll be buying anything until next week. Mentally I'm feeling tired, did not sleep well and I'm ill. Almost impossible for me to concentrate on what needs to be done. Thankfully it's a long weekend ahead and I should be back to normal on Monday. The stock indices are oversold both short and medium term. There will be some type of bounce soon. What happens after the bounce will determine what kind of market we're in. The markets continue to be held hostage by the European debt problems. It is still a headline trading driven affair. I think we will take our cues from what happens the rest of the week in the foreign markets. It's anybodies guess really. There is nothing wrong with waiting things out on the sidelines as well. The technicals are calling for a bounce and we haven't gotten any. Things could get interesting and not in a bullish way. We'll see.

2011-11-22T13:08:00.000-08:00

Oversold and staying there as the Dow lost 53 points on light volume. The advance/declines were negative. There were rumblings from Europe about the debt problem and from the reading of the latest Fed minutes. Don't really know where we go from here. Should have had some type of bounce by now. Summation index still heading lower. I do not expect a collapse but what do I know? Not much trading left in the US this week with the Thanksgiving holiday looming. GE fell 1/4 on light volume. I still have the open order in for the January calls. Not exactly sure this is the right move the way the overall stock indices are acting but we are oversold on a daily basis. Plenty of time for this trade to work if the order does get filled but that won't matter if we just continue lower for an extended period of time. Gold bounced back over $20 on the futures. The US dollar bounced around today and ended about where it started. The XAU was up 2 7/8. ABX gained a buck, GG rose 7/8 and NEM up 1/2. Volume was light. I would still like to get the calls here on the gold shares for December or January. The ideal scenario would be for some base building in the near future. That, combined with a solid Gold/XAU ratio signal, is all we need. We'll see. Mentally I'm a bit tired, did not sleep well. Also not feeling 100%. Oversold, staying there and not a lot of volume. These aren't bullish factors. The stock indices are oversold on a daily basis though. Lots of economic data out tomorrow but the markets haven't cared much about that lately. So on we go. It's a tough trading environment but we knew that already. Perhaps the GE call trade will fill tomorrow.

2011-11-21T13:06:00.000-08:00

We started off the shortened trading week to the downside as the Dow fell 249 points on average volume. We were down well over 300 during the session. The advance/declines were 4 to 1 negative. I was expecting a bounce and it hasn't happened. I did not expect any huge downside and that is exactly what we got. So my idea of what is going on here at the moment is wrong. Oversold and staying there and that is never bullish. Summation index is heading lower. Something is going on but I have no idea what that is. It's happened before. Europe, the US debt problem, fears of another recession, you pick the excuse. I still expect upside medium term for the stock indices but that could be wrong as well. GE lost 3/8 on average volume. I placed an open order for the January calls. I'm leaving it in overnight. The premiums are getting down to about what I'd like to pay for this trade. Not sure it will work but I'm willing to give it a shot. Plenty of time for this trade to work if the order does get filled. Unless we are on the verge of some type of market collapse. I still don't think that is about to happen. Gold got clobbered again today, off over $40 on the futures. The US dollar was higher again today but not a lot. I'm not sure what is going on with gold at the moment either. The XAU lost 3 2/3. ABX down 3/4, GG lower by 7/8 and NEM fell 1/8. Volume was average. The gold shares all came well off of their lows. I would still like to get some January or December calls here. Perhaps today was the day. I'm trying to wait for the Gold/XAU ratio to hit the recent number for a buy signal. Did not happen today. The gold shares are still performing better than the metal itself and that is bullish for the gold shares going forward. Mentally I'm feeling tired and not all that well. It makes the decision making even more of a chore. I'd still like to let this week pass before doing anything but I did place the GE trade. Once again there is something happening in the markets and I can't put my finger on it. I expected this week to be slow due to the holiday and it has started anything but that. We'll see what happens in the overseas markets tonight and take it from there.

2011-11-18T17:22:00.000-08:00

Not a very volatile expiration Friday as the Dow gained 25 points in uneventful trading. The advance /declines were positive and the volume was light. The overall market was a bit weaker than the Dow. We're short term oversold here and I would expect a bounce in the beginning of next week. I would also expect light volume next week as well with the Thanksgiving holiday on Thursday. I do not have any OEX trades in the works right now. GE was flat on light volume. The technicals here are oversold. I still would like to purchase the January calls here. Waiting for the premiums to get cheaper. Gold was up $5 today after yesterdays sell off. The US dollar was weaker today. The XAU was off 1 3/4. ABX and GG were off 3/8, while NEM lost 3/4. Volume light here too. We aren't oversold on the daily technicals for the gold shares just yet. However the weekly charts do not look constructive anymore for the bullish cause and patience is in order. Mentally I'm feeling tired, did not sleep well. I'm still a believer in higher prices for the stock indices medium term. We've been basically moving sideways for the past 4 weeks. The summation index is moving lower now and that is something to consider for the downside argument. The light volume lately isn't bullish either. So we'll see. I think staying on the sidelines next week would be a good strategy. It's getting to Friday night now and time for a rest.

2011-11-17T13:05:00.000-08:00

Continuing lower today as the Dow fell 135 points on average volume. The advance/declines were 4 to 1 negative. No real news to speak of to spark todays decline and we did come off of the lows. The summation index is heading lower. Getting short term oversold. I'm not exactly sure what's going on here but I still don't think we are on the verge of a collapse. Option expiration tomorrow. So we'll see what happens. GE was down 1/3 on better volume. We just broke the 50 day moving average line on the daily charts. When the premiums get to what I'd like to pay, I'm getting some January calls for GE. That time may be approaching soon. Gold took a hit today, off $55 on the futures. The US dollar was higher but not that much for gold to be down as far as it was. The XAU fell 7 3/8. ABX off 2 1/8, GG dropped 1 1/4 and NEM lost 1 3/4. Volume was more than lately but still not that much. I'd still like to get some gold share calls for the upcoming months. When we're oversold here on a daily basis, I'll be purchasing the calls. Perhaps within the next 2 weeks. We'll see. I'm also not sure why gold suddenly took a fall today as well. Mentally I'm feeling OK, slept well. We're still basically moving sideways on the stock indices but are at the bottom of the channels. If GE is again the proxy for the stock markets, we will be breaking through to the downside. That remains to be seen. The volume has been light all around and that isn't bullish. We will also be entering tax selling season at the beginning of December. The technicals are what really matter and we are approaching oversold levels on a daily basis. Let's get through tomorrow and take it from there.

2011-11-16T13:06:00.000-08:00

We opened lower, made it all the way back and then got clobbered in the final hour to finish the day with a loss of 190 points on the Dow. The advance/declines were 3 to 1 negative and the volume was average. A report came out late in the day about the US banks exposure to the European debt. As if nobody knew about this already. But that's what happens in an event driven marketplace. We are in the 4th week of sideways action in the stock indices, so perhaps we are going to break out to the downside. We'll have to see what comes out overnight. The economic data out today wasn't all that bad but continues to be ignored in the face of the European debt problem. That is the ongoing situation and it hasn't changed. GE was off 1/4 and the volume is still light. A waiting game here and it is probably better to be patient. Gold fell $8 in the futures market and some more in the aftermarket. The US dollar continues higher as the flight to safety is still in effect. The XAU dropped 4 bucks. ABX off 7/8, GG down 3/4 and NEM led the way lower by 1 2/3. Volume remains light here. Perhaps I'll get an opportunity to try the gold share calls for December or January if we continue lower. The weekly charts will not be looking as positive though if the downside here persists. I'm going to try and wait for the daily chart technicals to get oversold and take it from there. Not there yet. Mentally I'm feeling OK, slept OK. I still think that the trend for the stock indices medium term remains up. I do not think we are heading into the abyss. I'm still a believer that we've seen the lows for the year and prices will be heading higher. The price of oil just broke $100 and that tells me there is demand. I don't think we're headed for a double dip recession. But what do I know? And does it really matter? In reality the only thing that really matters is the next trade. January GE calls or the December/January gold share calls. Those are the ideas for now.

2011-11-15T13:09:00.000-08:00

The Dow closed higher by 17 points today on light volume once again. The advance/declines were positive. The overall market was stronger than the Dow. The pace has slowed down for some reason as the trading for the first 2 days this week has been rather lackluster. That could change at any moment on news though. No OEX trades in mind here at the moment. GE was up 1/8 on light volume. Trying to hold the 50 day moving average line on the daily charts. Succeeding so far. I'm still waiting for an entry point for the January calls. Gold was up $5 on the futures after being lower early. The US dollar had another good day. The XAU was up 1/8. ABX, GG and NEM were all basically flat on the day on very light volume. I'll be looking to get long here once the technicals are oversold. Not close to that happening yet. I will try and remain patient. Mentally I'm feeling OK, slept well enough. 3 days left in the November option cycle. So far this week has been a very light volume affair. I would expect that next week will be holiday slow as well. Like I said before, any news could spike the stock indices one way or the other without any notice. Or we could just meander around waiting for something to happen. The latter seems to be the case so far this week. There is a lot of economic data out this week but so far the markets aren't really paying attention. We still remain hostage to Europe.

2011-11-14T13:09:00.000-08:00

We started off expiration week lower as the Dow lost 75 points on very light volume. The advance/declines were 3 to 1 negative. We came off of the worst levels of the day and the volume was light so I don't think this is the beginning of some kind of huge downside move. But anything can happen I suppose with all the problems in Europe. 4 days left on the November options and I doubt I'll be trying anything with the OEX this week. We're still dealing with the 200 day moving average lines on the major stock indices. GE was off 1/4 on light volume. The January calls are what I'm looking at there and have been for a while. When the premiums get to a level that I'd like to pay and the stock is oversold, that will be the time to try that idea. Gold was down $7 on the futures as the US dollar was higher today. The XAU fell 3 1/3. ABX, GG and NEM were all down a buck on light volume. I'd like to see the gold shares pull back some more before trying the calls here again. May not happen. I'm looking at the December and January options for ABX and GG. We'll see. Mentally I'm feeling a bit tired, did not sleep well. We still remain in an event driven marketplace and once again that is a tougher than usual trading environment. We have expiration week this week and a long holiday week next week with Thanksgiving. The prudent course of action here may just be to do nothing unless a valid technical signal appears. But that should almost always be the case. We'll see what happens overnight and go from there.

2011-11-11T13:51:00.000-08:00

Positive news out of Europe today and the Dow gained 260 points on light volume. The advance/declines were 6 to 1 positive. This is the type of up and down game we're in. Down almost 400 points on Wednesday and gaining it all back in the following 2 days. We are hovering at or below most of the 200 day average lines for the stock indices. How we resolve this issue will tell the most about longer term direction. I still think we will be seeing higher prices going forward. That's my guess for now. But we are still in a headline driven environment. Anything can happen overnight. GE was up 1/4 on light volume. I still will consider the January calls here if we get some pullback. Nothing doing for now. Gold had a good day, up almost $30 on the futures as the US dollar had a bad day. The XAU rose 6 3/4. ABX up 2, GG gained 2 1/2 and NEM tacked on 1 2/3. Volume was light but there were no sellers. I placed an overnight order in for some ABX calls but it wasn't filled. I was a day late here as we have started to move up again. With only 5 days to go in the November option cycle, I do not think that I'll try this trade again. But who knows? The weekly charts are still pointing to higher prices. I may go out to December or January if we get some downside. Mentally I'm not feeling good about missing that ABX trade at a higher strike price. We are overbought but with all the uncertainty in Europe, gold seems to be the place that is attracting money. I do think that ABX and GG will follow NEM to new highs in the next couple of months. That would require a break to the upside from the $55 level for both of these stocks on good volume. If and when these issues get through $55, they could move much higher since there is no resistance beyond that point. That is my idea for the gold shares in the medium term future. The stock indices are being moved around by the events in Europe on a daily basis. That is a tough game to play. I am looking for higher prices in the coming months but how we get there is anybodies guess. Only a week left in the November option cycle so I really don't see myself taking on any short term trades here but you never know. I'll check the charts over the weekend and go from there. For now it's Friday afternoon and time for a rest.

2011-11-10T15:55:00.000-08:00

We attempted to stabilize today after yesterdays debacle as the Dow gained 113 points on lighter volume. The advance/declines were 2 to 1 positive. The overall market was weaker than the Dow. It's anybodies guess what happens from here. News could come out of Europe one way or the other. The technicals are not overbought or oversold on the stock indices, so we could go either way. I don't have any OEX trades in mind right now. 6 days to go in the November option cycle. GE was up 1/4 on average volume. No trades here for now either but I'm still considering the January calls here. Gold fell $30 on the futures today and the US dollar was weaker as well. I can't explain that. The gold shares held up rather well as the XAU only fell 7/8. ABX was flat, GG lost 3/8 and NEM dropped 1/2. Volume was light. All were lower early and that may have been the time to get the November calls for a short term trade. Perhaps. That is the only trade that I'm considering at the moment. Very risky though with a little over a week to go for the options. The gold shares are outperforming the metal itself though and that is bullish going forward. Mentally I'm feeling OK. Longer term I'm looking for higher prices but where we go in the near term is the question. Was yesterday just a one day blowout or the beginning of something bigger? Obviously, I don't have the answer. I had a better feel for things a few weeks ago. I still think I want to try the ABX calls again here. The weekly chart still looks positive. Perhaps I'll go out to December instead of January for that idea on a longer basis. We'll see. I'll consider things overnight and go from there.

2011-11-09T13:16:00.000-08:00

Troubles in Italy took center stage as we remain in a headline driven market. The Dow fell 389 points on average volume. The advance/declines were 9 to 1 negative. I had thought we might continue to the upside but that was wrong. We are hostage to what happens overseas. Where we go from here is anybodies guess. The technicals will get thrown out the window. After a day like today you've got to figure that we're heading lower. Europe continues to be an ongoing problem and there really is no end in sight. It makes for very difficult trading for sure. The sidelines isn't a bad place to be but you don't make any money there. You also don't lose any either. GE was off 2/3 on good volume. I'm back to considering the January calls. We aren't really oversold here on a medium term basis, so I'm in no hurry. Gold fell $7 on the futures and another $20 in the aftermarket. The US dollar was very strong today as the euro plummeted. Gold held up pretty good early but then dropped. The XAU lost 7 1/4. ABX down 7/8, GG lower by 1 1/4 and NEM led the way falling 2 1/3. Volume was good to the downside, which isn't bullish. But I still might try the ABX calls for November again. The relative strength of the gold shares here is very good. The technicals are starting to roll over though. If the stock market heads lower here, it will take the gold shares with it. So this isn't going to be an easy trade to put on. Plus there are only 7 days left in the November option cycle. I'm also considering going out to the January contract as well. Mentally I'm feeling OK. Volatility really picked up today and that could be a sign of danger for the stock indices near term. Or some positive news comes out of Europe tomorrow and we rally 300 points. That is the problem trading right now. Anything can happen in rapid fashion. If you're on the right side of things it will turn out well. If you're not, you'll get wiped out. I might put in an overnight order for some ABX calls but I will have to study things tonight. I also may just sit things out. After the last ABX trade, I need to be careful not to project what happened there into the future. Not every trade is going to be a big winner. I'll check the charts and take it from there.

2011-11-08T13:14:00.000-08:00

We bounced around today and then continued higher as the Dow gained 101 points on light volume. The advance/declines were 3 to 1 positive. We got some news out of Italy today that the market viewed as positive. So we continue to live in a headline driven trading world. Perhaps we can take out the recovery highs this week or before expiration. Summation index still heading higher. Getting short term overbought. GE was up an 1/8 on better volume. The daily chart looks constructive for more gains here but I'm not sure that I'll try something with 8 days left in the November option cycle. Maybe. Gold was up $8 on the futures as we crossed the $1800 level early in the day. But we sold off in the aftermarket after the Italy news. The US dollar lost ground too as the safe haven trade was taken off for a day. The XAU dropped 1 2/3. ABX off 3/4, GG fell 2/3 and NEM lost 1/2. Volume was average. I dumped the ABX calls during the session for a gain of 575%. I still like the gold shares but wanted to lock in a decent profit while in the overbought technical condition. I still may try these again before expiration, moving to a higher strike price. I'm also looking out to January here as well. We are overbought but in this type of market environment anything can happen. Mentally I'm feeling tired, did not sleep enough. The stock indices continue higher as it's possible that we will simply rally into the expiration. Or not. That is the problem here as the uncertain, headline driven marketplace moves forward. I don't have any trades in mind here at the moment. I do favor higher prices near term. The ABX trade is done. I had the biggest loss of the year in the previous trade followed by the biggest gain. That doesn't mean anything. It's on to the next idea as there are still 8 days left in the November option cycle. I usually don't do too well with the short term trades though. The weekly gold share charts are still looking like there's room to run on the upside. It's possible that I'll try the ABX calls again for November. We'll see what kind of news comes out overnight and take it from there.

2011-11-07T13:10:00.000-08:00

Although we opened higher, we were lower for much of the day but made a comeback in the last 2 hours and closed on the high of the day. The Dow gained 85 points on light volume. The advance/declines were positive. Now Italy is the problem as the focus remains in Europe. It's a different country every day it seems like now. I think we could head higher off of todays close. We're not at high overbought levels on the technicals for the stock indices. Of course we are one bad headline from Europe away from a decline as well. It's a tricky trading environment. GE was flat on light volume. The technicals here mirror the overall market as well. No trades in the pipeline for GE right now. Gold had a good day on the European worries, up $35 on the futures and a bit more in the aftermarket. The XAU gained 6 1/3. ABX rose 1 3/8, GG up almost 2 and NEM broke out to new highs with a gain of 2 3/4. Volume was OK for the gold shares but I would have liked to see more. Very overbought here now. My ABX calls continue to gain ground but I can't hold on to them forever. ABX was the laggard today and that isn't a good sign. I might just bail out tomorrow. We'll see. Mentally I'm feeling OK, slept well. We're still being held hostage by Europe. It's the ongoing saga and there is no end in sight. Not a lot of economic data out this week. It will probably be a headline driven affair for the stock indices this week. Gold had a good day despite the US dollar being higher for much of the day. I'm not sure gold can just continue up in a straight line as we are approaching $1800. I will have to ponder what to do with the ABX calls tonight as I have held them for almost 3 weeks and they are considerably overbought. However NEM, which is usually the gold share leader, has just broken out to new highs. Is it possible that GG and ABX could follow? The weekly charts still point to higher prices. Tough call but I don't want to get too greedy and I don't want to miss out on the gains. The game is never easy.

2011-11-04T13:18:00.000-07:00

We were lower all day today but pared some of the losses as the day wore on. The Dow closed down 61 points on light volume. We were down around 190 in the early going. The advance/declines were negative. The employment report was mixed, with better revision numbers but weaker job gains in October. The focus was on Greece once again as there is another vote of some sort to be held tonight. The markets are being held hostage by the headlines in Europe. That is the ongoing story. GE fell 1/4 on light volume. No trades here for now. Gold was weaker today as the US dollar gained on the Europe story. The gold futures fell $8. The XAU dropped 2/3 but was much lower early as well, following the overall stock market. ABX down 2/3, GG off 1/4 and NEM was flat. Volume was light here. That is what you'd like to see if you're looking for higher prices. My ABX calls lost some ground today. I really need to exit this trade next week. That is what I should do, if we get any strength. Overbought on ABX and staying there but that won't last. The weekly charts still look positive but there are only 2 weeks left in the November option cycle. Mentally I'm feeling OK, slept good. It was a down week for the stock indices but there is nothing in my mind to think that this is the beginning of some type of extended down trend. The summation index is still heading higher. The markets are waiting for some type of resolution on Greece and the European debt situation. This is a story that just keeps dragging on. It is really anybodies guess as to how that all plays out. As for the ABX trade, it's still showing a decent profit. I'll probably dump them next week. I'll be checking the charts and the headlines over the weekend. I expect the volatility will continue for the time being. It's Friday afternoon and time for a break.

2011-11-03T13:26:00.000-07:00

We continued higher today as the Dow gained 208 points on average volume. The advance/declines were 4 to 1 positive. Still dealing with the daily drama from Greece. The market moves up and down according to that news for now. We do have the employment report out tomorrow but unless it's something out of the ordinary, it won't mean much. That's my opinion. It's still a European headline moving market. We are moving off of the early week short term oversold condition. GE was up 3/8 on average volume. Just biding my time here as there is no imminent trade yet in my mind. I could be wrong. Gold had a good day, up $35 on the futures as the US dollar was lower. Gold is also getting some of the flight to safety money I believe. The XAU rose 5 7/8. ABX up 1 1/2, GG gained 1 1/4 and NEM led the way higher by 2 3/4. Volume was average. My ABX calls are back to being solidly in the black. Short term overbought and staying there for ABX. The weekly charts still look constructive though. There's still 2 weeks left in the November option cycle. I don't want to get too greedy though. Mentally I'm feeling OK, slept well enough. It's been a volatile week so far for the stock indices. Anything can and will happen in this type of environment. I don't have any OEX trades in mind right now as I'm focusing on ABX. I am going to try and time the exit properly but we all know how that goes. ABX has almost had a straight line up move in the past 2 weeks and that won't last forever. We'll see what happens tomorrow. There is still plenty of time left in this trade but I don't think I'll be holding it until the last day of the option cycle. I do have a target in mind but it is more technically related than price related. We'll see.

2011-11-02T13:40:00.000-07:00

A bounce in the Dow after the last two negative sessions as we ended the day with a gain of 178 points on light volume. The advance/declines were 5 to 1 positive. The Fed spoke, people listened and we got on with it. I didn't like the fact that the volume was light today. However we are moving to a short term oversold condition on the stock indices and that may provide some relief for the bulls. Or not. Next up is the employment report on Friday. That doesn't mean that we aren't wary of anything coming out or Europe. That's the wild card here. GE was up 1/4 and the volume was light here as well. The technical condition of GE is a mirror of the overall market. No trades here for now. Gold was up about $25 on the futures as the US dollar fell a buck today. The XAU rose 4 1/2. ABX up 1 1/4, GG higher by 1 2/3 and NEM gained a buck. Volume was average here. My ABX calls are still in the black. I am thinking about getting rid of them soon but the technicals are not yet as overbought as I would like. That said, getting a profit out of this trade is imperative. Mentally I'm a bit tired, did not sleep well. Todays market action looked like nothing more than an oversold bounce but I could be wrong. The markets are waiting for some news from Greece. That will be the key for the near term direction. The problem there is that you just don't know what's going to happen. It's hard to trade off of that. But that is the market reality we're in at the moment. We'll see what tomorrow brings.

2011-11-01T13:06:00.000-07:00

The Dow continued lower today with a vengeance as we lost 297 points on good volume. The advance/declines were around 7 to 1 negative. The troubles in Europe returned today and it looks like that story just won't die. I did not expect a big decline here and I was wrong. No telling exactly what may happen now. The markets are being held hostage by Greece. It sounds stupid but that is the story for now. Moving to oversold very quickly but there is still room to go lower if the market wants to. We have moved back down into the previous congestion zone. I suppose anything can happen at this point. GE opened gap down and lost 2/3 on increasing volume. Maybe I will get a chance for the January calls after all. However at this time, in this market environment, it would be better to let things shake out first. It is getting a little crazy. Gold sold off early and then made somewhat of a comeback. The futures were only off 5 bucks after being much lower. The US dollar had another huge up day in the flight to safety. The XAU was off 2 points and bounced around all day. ABX lost an 1/8, GG rose an 1/8 and NEM fell 1 1/4. These issues also bounced around after opening much lower. Volume was average. My ABX calls a started the day in the red but made a comeback and are back in the black for now. The volatility is enormous at the moment. That will keep the option premiums higher than usual. I'm holding on to the ABX calls for now but could exit at any time. Mentally I'm a bit tired, did not sleep well. We have the Fed tomorrow and the employment report on Friday and it seems like that doesn't even matter. It is a headline and event driven marketplace once again. It makes for tougher than usual trading. It also presents opportunities if you are astute enough to find them. The weekly ABX charts still look good to the upside to me but that could evaporate at any time. It is that type of situation that we find ourselves in. We'll see what happens in Europe overnight and go from there. It will be interesting.

2011-10-31T13:12:00.000-07:00

We closed the month with a pretty big loss as the Dow started the week down 276 points on average volume. The advance/declines were almost 5 to 1 negative. A money management firm went belly up in the US. That, along with locking in some gains from the recent run up in prices were the culprits for todays action in my opinion. But what do I know? I still think we will see higher prices going forward. We may be on our way back to retest the breakout from the congestion zone. That would be around the 1225 level on the S&P 500. We closed on the low for the day and that is short term negative. GE was off 1/2 on lighter volume. No trades here for now. Gold fell today as the US dollar had a very good day. The precious metal lost about $25 on the futures. The XAU fell 6 3/4. ABX down 1 1/3, GG lost 1 1/4 and NEM led the way lower by 1 2/3. The only saving grace was that the volume was lighter than lately. My ABX calls gave up some of the gains but they are still profitable. The weekly charts are still looking good but the daily charts are overbought and rolling over. The ideal situation would be sideways action before heading higher but the time decay of the options would still take effect. There are still 3 weeks left in the November cycle though. It's a tough call. I'm holding on to them for now but that could change at any time. Mentally I'm feeling OK. It was a rough start to the week if you're bullish but we had become extended to the upside. I don't think it's the beginning of some extended downside but you never know. We've got the Fed and the employment report coming up this week, so we could get some volatility. ABX had gone up in a straight line, so some consolidation is expected. However if we have a reversal there and a decline starts my ABX calls will be losers. Stay tuned.

2011-10-28T13:18:00.000-07:00

It was a day of rest for the markets as the Dow gained 22 points on average volume. The advance/declines were about even. It was a sideways market all day as we digested the huge gain of the previous day. It was quite a good week for the stock indices. The summation index continues higher. I think it's now obvious to everyone that the trend is up. We'll see how long it can last and I expect that it will for a while. GE lost 1/8 on average volume. No trades here for now. I still might try the January calls but I'd have to see the price drop first. Gold fell $3 today as we are digesting the weeks gains here as well. The XAU rose 4 2/3 as the gold shares are outperforming gold itself. That is usually bullish going forward. The US dollar was a bit higher today. ABX and GG both up 1 7/8, while NEM tacked on 2 3/8. Volume was good. Prices are moving higher with volume on the gold shares. That's a positive sign. My ABX calls are now solidly in the black. ABX had its best week to the upside since 2009. The question now becomes when to sell them. The entry on this trade wasn't that good. I'll try to do the exit better. Volume and open interest expanded on some ABX options over the past week as well. That usually implies higher prices. Mentally I'm feeling OK, slept well. The stock indices are in rally mode and the weekly charts suggest higher prices yet to come. Short term we are overbought and staying there. We've got the Fed next week and we may be on hold until then. We also have the end of the month on Monday followed by the usually bullish beginning of the next month. Not to mention the employment report on Friday. So there will be plenty to sift through next week. I have some price targets in mind for the ABX trade but I don't want to get too greedy. However I also don't want to leave too much money on the table either. Things can also turn on a dime in this game. That's something to remember. For now it's a fall Friday afternoon and time for a break.

2011-10-27T13:15:00.000-07:00

We got a deal in Europe and the markets responded with the Dow rocketing higher by 340 points on heavy volume. The advance/declines were almost 8 to 1 positive. We were up over 400 before selling came in late in the day. Overbought here now but the trend is up regardless. Summation index moving higher. Declines can still be bought. We have broken through the 200 day moving average convincingly on some of the stock indices. That is bullish. More will follow. You can get long and stay long. GE was up a buck on very heavy volume. The January call trade here that I had in mind has been missed at this point. Maybe I could try it if we get some pullback before the end of the year. But that remains to be seen. If GE is still a proxy for the overall market, than we've got more to go on the upside. I'm a believer in that. Gold was up about 20 bucks as the US dollar got smashed. The European deal led everyone of of the dollar and into the foreign currencies. The XAU rose 5 3/4. ABX up 1 1/8, GG gained 3/4 and NEM tacked on 1/4. The volume in ABX was heavy, just average for GG and NEM. ABX had stellar earnings and my ABX calls are solidly in the black. Overbought here and I probably should have sold them today but the weekly charts look very constructive to the upside. I still may take the profit tomorrow and try to buy them back cheaper next week. But price and volume are moving higher and that is bullish. Mentally I'm a bit tired, did not sleep enough. The stock indices are moving higher post Europe. The question now is what will be the next catalyst to propel us higher? I would expect the indices to take a rest here due to the fact that we are seeing a buying feeding frenzy. We'll see. The ABX trade is one that still has 3 weeks to go but we are pretty overbought right now. I may exit on follow through if we get any tomorrow. We are at the convergence of the 50 and 200 day moving averages here. A pause is to be expected. However if I do exit this trade there are no guarantees that I'll be able to buy the options again cheaper before expiration. Profit or loss, there are no easy trades in the game. We'll wrap up the week tomorrow and the month on Monday.

2011-10-26T13:15:00.000-07:00

Back to the upside as the Dow gained 162 points on average volume. The advance/declines were about 4 to 1 positive. The Dow was stronger than the overall market today. Still waiting for Europe to announce something about the debt deal. The market was back and forth today, higher, lower, higher. I still think we will be going higher. But as I stated before, some consolidation would not be a bad thing. GE was up an 1/8 on average volume. Still waiting here for an entry point for the January calls. Gold continued higher, up about $20 on the futures. The US dollar was up a bit as well. The XAU gained 2 points. ABX was up 2/3, GG lost a fraction and NEM was up a buck. Volume was good here again. GG announces earnings after the bell and ABX before the bell tomorrow. My ABX calls are still in the black. I will probably sell them tomorrow on the earnings news. Or not. Gold has shown some life here this week and I may hold on a bit longer to the calls. We'll see. Getting overbought on the gold shares but there still may be some room to the upside. Mentally I'm feeling OK, slept well. We'll wait to see what happens in Europe tonight and we have the GDP report coming out tomorrow. So I would expect to see some more movement in the stock indices again tomorrow. It certainly isn't a quiet market at the moment. ABX will announce its earnings and I suppose that will be the key for this trade one way or the other. I am also thinking of just selling the calls tomorrow regardless and then trying to buy them again before the November expiration. The weekly ABX chart is beginning to look constructive to the upside. We'll see what happens tomorrow morning and take it from there.

2011-10-25T13:06:00.000-07:00

Back to the downside as the Dow fell 207 points on average volume. The advance/declines were almost 5 to 1 negative. Some consolidation can be expected here as we have been moving higher for 3 weeks or so. I do not think it's the beginning of something big to the downside. I could be wrong and often am. But this time, I believe that today is a pause in a continuing uptrend. The summation index continues higher. Still waiting on European news tomorrow. GE fell 1/4 on average volume. It's just a waiting game here for me. The January calls are the plan and the purchase time is when this issue gets oversold. Not there yet. Gold was the story of the day as it surged about $50 on the futures despite the dollar being higher as well. The XAU gained 2 3/4 but was higher before losing ground at the end of the day, following the overall market. ABX gained 7/8, GG up 1 3/8 and NEM rose a buck. Volume picked up which supports the bullish cause here. These issues were higher on the day as well but fell off late. My ABX calls have made it into the black. However ABX is lagging both GG and NEM here and that isn't positive. I'm still holding out for the earnings on Thursday morning. That could be the time to dump them for whatever they're worth. We'll see. We're not overbought here yet and I may hold onto them longer than I expected. Mentally I'm a bit tired, did not sleep enough. We had a big day in the price of gold but the gold shares didn't move as much as I'd like. We'll see how that plays out going forward. The stock indices are waiting on Europe. What happens when that's over? I still believe that we're heading higher regardless. We'll see what the news is tomorrow and the markets reaction to it.

2011-10-24T13:11:00.000-07:00

The market continues higher as the Dow gained 104 points on average volume. The advance/declines were over 4 to 1 higher. This won't go on forever as we are overbought and now overdue for a pause. But the trend is up and there is no denying that fact. Now Europe will report something about fixing their problems on Wednesday. I don't know how that will pan out but whatever the reaction, prices are going higher eventually. Declines can be bought in my opinion. GE was up 1/8 om average volume. We got through the earnings. Now it is a matter of waiting for GE to reach oversold levels. If and when that occurs, I'm still looking at getting some January calls there. Gold was higher today as the US dollar fell. The yellow metal was up $18 on the futures and the XAU gained 8 points. ABX and GG rose 1 2/3, while NEM was up 1 1/4. Volume was light. My ABX calls are almost back to break even. The poor timing on the entry obviously is costing me whatever profit that could have been gained from todays nice up move. I'm still in favor of waiting for the earnings report on Thursday to possibly exit this trade. At least now there is a chance it won't be a loser but that could all change going forward. Mentally I'm feeling OK. The stock indices are overbought and staying there. That in itself is bullish. However we do need to see some type of pause in this straight up kind of action to ensure that the rally has staying power. That's how I see things at the moment. We may be in a holding pattern, waiting on Europe. The ABX trade has taken a turn for the better with todays price action but the volume was weak. I'm going to wait for the earnings later this week to decide what to do. So it's a waiting game there until Thursday. Nothing else on the radar screen at the moment.

2011-10-21T13:03:00.000-07:00

We ended the week with a bang as the Dow gained 267 points on average volume. The advance/declines were better than 6 to 1 positive. The summation index continues higher. We are breaking out of the congestion zone to the upside. The trend is up until further notice. We'll get some kind of news from Europe over the weekend and that will be the catalyst one way or the other for Monday morning. Declines can be bought. GE lost 1/4 on good volume. The earnings were in line with expectations but it didn't matter. This could be a sign that the overall market will move sideways next week but that's a guess. GE did not participate in the rally. I still want to get some January calls before the end of the year. If and when we get oversold on GE may be the opportunity. I'll keep an eye on things. Gold had a good day, up $28 on the futures and sold off a bit in the aftermarket. The dollar took a hit today. The XAU gained 3 3/8. That didn't help the major gold stocks as ABX and GG were up only 1/4, while NEM gained a buck. Volume was light. My ABX calls are still in the red and it doesn't look like this trade is going to work out. If ABX can't rally on a day gold is up and the market rallies over 200 points, then the calls I own are in trouble. I'm still going to hold out for the earnings next week but that will be about it. At this rate I don't think this trade will get back to break even. ABX opened very strong and then sold off for the rest of the day. That isn't positive price action. We'll see about next week. Mentally I'm feeling OK, slept good enough. The stock indices had a strong rally today and appear to be breaking out. We'll see on Monday just how much of today was expiration related. I'm still a believer that the decline is over and higher prices are in the future. We'll see what transpires in Europe over the weekend and go from there. For now it's Friday afternoon and time for a break.

2011-10-20T13:08:00.000-07:00

An up and down day as the Dow finished ahead by 37 points on average volume. The advance/declines were positive. The market is being held hostage by the ongoing fiasco in Europe. Hopefully something gets resolved over the weekend. But that won't be the end of it as there are no quick fixes. Expiration Friday tomorrow. More overbought than oversold here. Summation index still moving higher. I'm a believer in a breakout to the upside from the congestion zone for the stock indices. GE was up 1/8 on average volume before the earnings report tomorrow. Tomorrow the market will key off of this report early in my opinion. I'm still looking out to January if and when we get oversold here. Gold fell again today as the US dollar showed a bit of strength. The precious metal lost over $30 and the XAU fell 1/4. ABX down 1/2, GG lost 1/8 and NEM off by 2/3. Volume was good. My ABX calls are in the red. I'll be lucky to get out alive at this point. I think that I was a day early on the purchase. I'm committed to holding on until the earnings are out next week. We did close pretty far from the low of the day which may portend higher prices tomorrow. Mentally I'm a bit tired, did not sleep well. GE earnings tomorrow should set the tone for the stock market and we'll go from there. Expiration Friday will add to the mix. Gold and the gold shares are having a tough week and we'll see how it closes out. No economic reports due out tomorrow but they are taking a back seat to Europe anyway. Let's finish up the trading week and see what happens over the weekend.

2011-10-19T13:11:00.000-07:00

Back and forth so far this week as the Dow lost 72 points today on light volume. The advance/declines were about 3 to 1 negative. The overall market was much weaker than the Dow. Earnings disappointments and a weak read on the economy by the Fed were the culprits. Not to mention the overbought condition of the stock indices combined with the resistance at the top of the months long congestion zone. Some hesitation is expected here. GE was off 1/8 on lighter volume. The fact that GE held up rather well today tells me that there is no huge decline coming up for the market. At least that's my theory for today. Could all change with the earnings for GE out on Friday but I don't think so. Gold fell $5 on the futures and a bit more in the aftermarket. The dollar was weaker early but then came back. The XAU got slammed, down 10 1/2 points. ABX fell 2 1/3, GG dropped 2 1/2 and NEM down 3 1/8. Volume increased to the downside and that isn't bullish going forward. My order for the ABX November calls was filled and they are already in the red. Todays price action on the gold shares was very negative considering the price of gold didn't drop that much. No matter. The game plan was to get the November calls ahead of the earnings next week at the price that I felt was right. That much has been accomplished. We'll see where we go from here. Mentally I'm feeling OK. So the next trade has begun and I will have to try and do a better job of managing it than the last one. 2 days left in the October option cycle. Not sure what to think after todays negative action but I still think we are just pausing here before breaking out of the congestion zone. On to Thursday.

2011-10-18T13:10:00.000-07:00

Back to the upside as the Dow gained 180 points on average volume. The advance/declines were 5 to 1 positive. We are attacking the top of the congestion area and I do think we will break above it. Expiration week usually has a positive bias and that may be enough to push us through. Calls and being long are the way to go until further notice. GE was up 1/2 on average volume. Waiting on the earnings report on Friday. Gold took a hit today, down around $25 on the futures. We were down lower than that early and made even more of a comeback in the aftermarket. The US dollar was just a bit lower today. The XAU dropped early on but closed higher by 1/3 on the day. ABX off 1/8, GG was flat and NEM fell 3/4. Volume picked up here. The gold shares sold off hard to start the day and followed the market higher for the rest of the day. My order for the ABX November calls wasn't filled. Today was probably the day to get them. It was kind of a reversal back to the upside for the gold shares today. I'm leaving the order in but may have to adjust it if we continue higher in ABX from here. Or I simply missed it. Time will tell. Mentally I'm doing OK. The stock indices feel like they want to go higher here. The summation index is still pointing to the upside. You cannot fight that. We're still overbought both short and medium term but Mondays action relieved some of that. We'll see what happens overnight in Europe and take it from there.

2011-10-17T13:13:00.000-07:00

We started expiration off to the downside as the Dow lost 247 points on light volume. The advance/declines were about 5 to 1 negative. European worries surfaced once again. I do not think that this is the start of something big to the downside. We were both short and medium term overbought, so some type of pullback is expected here. I still believe that the trend has changed and we will eventually be heading higher. GE fell 1/3 on light volume. Earnings out on Friday. I'd still like the January calls there and will purchase them if the price gets into my range. Gold fell $6 as the US dollar was higher today. Probably due to the European fears being rekindled. The XAU dropped 5 points. ABX off a buck, GG down 1 1/3 and NEM lost 2/3. Volume light here as well. I placed an order for some ABX November calls and I'm leaving it in overnight. I'd like to be holding calls when the earnings are announced next week. We're overbought here so some decline is in order. We'll see. Mentally I'm feeling OK, slept good enough. A pretty good decline to start the week. The stock indices have risen up to the top of their congestion zones. Some hesitation is expected here but I do believe higher prices are in the offing. Declines can be bought in my opinion. I am frequently wrong though. The summation index is still heading higher even with todays decline. Plenty of economic data and earnings coming up this week. We'll see how it goes.

2011-10-14T13:09:00.000-07:00

It's a grind higher before expiration week as the Dow gained 166 points on light volume. The advance/declines were 5 to 1 positive. The sellers have left the building. Short and medium term overbought now but the tone of the market has changed. We're going higher until further notice. The low for the year has been put in. How can I be so sure of this? The summation index is heading higher. Seasonality turns bullish from here until spring. The presidential cycle points to higher prices. Any declines can be bought. The market has started to ignore bad news. This rally hasn't had great volume but I don't think that it matters. I could be wrong but this time I doubt it. GE was up 1/3 on light volume. We are still at the top of the congestion range and probably will break out next week. Earnings due out on Friday. I'll try my best to stay on the sidelines here before that. Gold continues higher with a gain of $15 on the futures. The US dollar was weaker today and it looks like the 2 month rally there is over. The XAU rose 6 1/3. The gold shares have been doing better than gold itself lately and that bodes well for the bullish cause going forward. ABX 1 1/4, GG gained 1 1/2 and NEM continues to lead the way higher, up 3 1/8. Volume was light however but nobody is selling. Declines in the gold shares are being bought. I would still like to try some gold share calls before the earnings coming out the final week of October. I would expect the gold shares to continue higher next week along with the market, pre-option expiration. Mentally I'm doing OK, slept well enough. The stock indices continue to roll along and there is really nothing to stop them now. Earnings season is upon us and the estimates are so low that even weak numbers will be cheered by the markets. That is the kind of game that this is. Know that and plan accordingly. The only way to play now is from the long side. I have a couple of ideas but getting in now after we've already rallied will not be easy. I'm going to try and not make some kind of short term trade next week but you never know. It really isn't my strong point but some would wonder if I have any strong points at all. No matter. The markets roll on. For now it's Friday afternoon and time for a break.

2011-10-13T13:01:00.000-07:00

A little bit of selling today as the Dow fell 40 points on light volume. The advance/declines were negative. The overall market was stronger than the Dow. Summation index is still heading higher. The trend has changed to the upside. Once we get past 1220 on the S&P 500, I expect the rise to accelerate. That's my best guess at the moment. GE dropped almost 1/4 on light volume. Overbought here but we could remain that way. I still want to own some January calls but I think I'll wait until after the earnings report next Friday. Gold fell $14 on the futures and the XAU lost 3 3/4. The US dollar was flat today. ABX down 1 1/8, GG fell a buck and NEM off 1/3. Volume was light. No trades in the gold shares for now. Mentally I'm doing OK but could have slept better. The recent OEX put trade loss was my biggest of the year. So it is no surprise that the confidence level is down and I'll tread lightly going forward. I will try not to make any short term trades in the last 6 days of the October option cycle but there are no guarantees. We'll get through Fridays trading and go from there.

2011-10-12T13:21:00.000-07:00

The rally continued today as the Dow gained 102 points on average volume. The advance/declines were about 4 to 1 positive. We did however cut the days gain in half by the close. We could be in for a pause here but the trend remains up. Summation index moving higher. We reached 1220 on the S&P 500 and backed off. 1220 is the final area of resistance in the congestion zone that has been in place since August. I almost placed an overnight order for some OEX puts. The McClellan oscillator gave a signal for a significant move but I held off. The previous loss may have saved me there. There's also a tendency sometimes to try and get back what you've just lost. Luckily I recognized this and did not place the trade. It doesn't make up for this weeks OEX trade loss though. GE was up 1/4 on average volume. I took off the open order for the January calls here. I'll keep an eye on things but this trade may have been missed. Gold was up $20 on the futures today as the dollar got whacked again. The XAU was up 1 3/4. ABX and GG both gained 1/3, while NEM fell 1/3. Volume continues light here. I also took off the open order for the ABX November calls as well. I still may try and do something before the earnings report at the end of the month but we are now more overbought than oversold here. I'd prefer to see the gold shares build more of a base here but that may not occur. Mentally I'm feeling OK. Even if the stock indices pull back in the near term, the trend has changed to the upside. We are short term overbought now. I'll be looking for some calls on weakness. I won't be in a hurry to do anything after this weeks losing trade. 7 days to go on the October option cycle and I have not had success with short term trades. I will try and be patient. Retail sales on Friday is about the only economic indicator coming up for the remainder of the week besides jobless claims tomorrow. We'll see if the rally can continue.

2011-10-11T13:10:00.000-07:00

We ended the day with a slight loss on the Dow as we lost 16 points. Volume was light and the advance/declines were positive. The overall market was stronger than the Dow. We are now short term overbought. That doesn't mean that we can't stay that way. I dumped the OEX puts for a 75% loss. I should have sold them yesterday as this was a trade that did not work at all. It happens. Today was probably a better day to purchase some puts. I have no other OEX trades in mind at the moment. GE was flat on light volume. I still have the open order in for the January GE calls. Gold lost $10 on the futures and the XAU dropped 1/3. The US dollar was flat today. ABX and GG had fractional losses and NEM fell 7/8. Volume remains very light here. The gold shares were lower early and came back. I think my next trade might be here but we'll see. Mentally I'm feeling OK. Not exactly pleased about taking the recent OEX loss but you've got to keep moving on in the game. 8 days left for the October option cycle. Short term overbought on the stock indices but the summation index is moving higher. I have no clear ideas at the moment. I do have the open orders in for GE and ABX but they are on a longer time frame. The market is news driven lately and we have a Senate vote on the jobs bill coming up along with a European bailout vote. We'll see how things go tomorrow.

2011-10-10T14:06:00.000-07:00

The Dow took off to the upside today on good news from Europe as we gained 330 points on light volume. The advance/declines were 10 to 1 positive. It was a partial holiday for Columbus Day which probably explains the light volume. The summation index will now be trending higher. The decline is now over in my opinion. My OEX puts are dead. I'll be taking the loss tomorrow which I really should have done today. Declines can be bought from now on. GE rose 2/3 on lighter volume. We've made it through the 50 day moving average and are at the top of the congestion zone. We should break through to the upside shortly. Gold was up $35 on the futures and a bit more in the aftermarket. The US dollar got slammed today on the good news out of Europe. The XAU gained 6 1/3. ABX up 1 1/3, GG rose 1 1/4 and NEM led the way higher by 2 1/8. Volume was extremely light here. I'd still like to get some gold share calls for November on a pullback. Mentally I'm feeling OK. I still have to open orders in for the January GE calls and the November ABX calls. I'll be leaving them in for now. Not happy about the OEX put trade but you take your chances sometimes in the game. We will most likely simply be going higher from here. Fed beige book out tomorrow and that's about it for news. We'll see what kind of follow through we get tomorrow.

2011-10-07T13:07:00.001-07:00

An up and down day as the Dow opened higher, sold off, came all the way back and higher only to sell off at the close. We ended the day with a loss of 20 points on average volume. The advance/declines were over 2 to 1 negative. The overall market was much weaker than the Dow. The employment report came out and was much better than expected. The market tried to rally but couldn't. That may or may not be telling going forward. My OEX puts are in the red as the timing wasn't as good on the entry as it good be but what can you do? That is the trouble sometimes with the stock index options. The timing has to be exact and nothing is exact in this game. The volatility and time premium in the options are already starting a rapid decay. I also had to lower the strike price which certainly doesn't help things. It's not a complete lost cause but I'm not counting on this to be a good trade. GE was flat on the day after trying to get through its 50 day moving average. Volume was average here. I'll be keeping an eye on things here as a proxy for the overall market. It seems to be working that way lately. Gold lost around $17 on the futures and the XAU fell 4 1/4. The US dollar ended little changed despite the good employment report. ABX, GG and NEM all dropped a buck on light volume. I think the gold share calls are the way to go if we retest the recent lows. I'm leaving in the open order for the November ABX calls. Mentally I'm feeling tired as I did not sleep well or long enough. The beginning of next week will be the key. We are at the levels on some of the technicals that have turned back any recent rally attempts. If that remains true, then the OEX puts I own will have a chance. If not, then I believe that the decline is over. That's my best guess at the moment. We didn't rally on good news and that may be telling. Monday is a partial holiday with Columbus day so that may skew things. Plenty to ponder over the weekend. For now it's Friday afternoon and time for a break.

2011-10-06T13:10:00.000-07:00

The rally continues and seems to be for real at this point. The Dow gained 183 points today on average volume. The advance/declines were 6 to 1 positive. Todays action will turn the summation index back to the upside. I went down to a lower strike price and purchased some OEX puts near the close. That was the game plan and I stuck to it but I wouldn't be surprised if it doesn't work based on the recent market action. However it will all depend on the markets reaction to tomorrows jobs report. We've worked off the oversold condition and some of the technicals are back at the levels that have begun the down moves. So we'll see what happens. GE rose 1/4 on average volume. Almost to the 50 day moving average line that has been resistance. I'm leaving in the order for the January calls. Gold gained over $10 on the futures as the US dollar was weaker again today. The XAU rose 4 3/4. ABX up 1 1/2, GG climbed 1 3/4 and NEM higher by a buck. Volume was average. It really looks like I missed out on a good opportunity here as both ABX and GG have risen well over 10% in the span of 3 days. I'm leaving in the open order for the November ABX calls but doubt it will get filled at the price that I want. My hope now is for some backing and filling in the gold shares to get long. May not happen. Mentally I'm feeling OK. Still 2 weeks to go in the October option cycle. All eyes will be on tomorrows employment report. So far it seems to me that we have had a huge snap back from the lows on Tuesday in the stock indices. If we continue to rally tomorrow, I'd say that the recent decline has run its course. If not, who knows? I'll be hoping that gold returns to its recent lows but hope is no way to trade. We'll see what the market reaction is to the employment news and take it from there.

2011-10-05T13:10:00.000-07:00

Building on yesterdays one day reversal as the Dow gained 131 points on average volume. The advance/declines were almost 3 to 1 positive. Now we must ask if the recent lows are the end of the downtrend and is the 2 day rally for real? I don't have the answers. I would still like to own some OEX puts before Friday. However with bullish engulfing patterns on the stock indice daily candlestick charts, that may not be the proper trade here. The weekly charts now look bullish as well. That could all change with Fridays employment numbers though. So it will be a tough call as to what to do tomorrow. GE was up 3/8 on good volume. I did place an order for some January calls today. I'm leaving it open until it's filled or I decide to do something else with it. Gold rose $25 on the futures and the XAU gained 8 points. The US dollar was lower today. ABX up 1 2/3, GG higher by 2 points and NEM tacked on 1 3/4. Volume was average. I also placed an order for some ABX November calls but I may be too late here as well. Perhaps if we get some backing and filling here, the order will get filled. I do not want to chase things here as I still think there is a chance for more decline in the overall market. Mentally I'm doing OK, slept well. I'll really need to decide tonight what to do, if anything, before Fridays employment numbers. Yes, I could always just sit it out and wait for the markets reaction. But if we get a huge decline from the start, it will be too late for the OEX puts. There's always the possibility that the numbers aren't that bad and we continue to rally. The technicals are moving up from being very oversold. I'll mull things over tonight and decide what to do for tomorrow.

2011-10-04T13:11:00.000-07:00

We had a one day reversal to the upside as the Dow opened lower and closed higher. We ended the day with a gain of 153 points on good volume. We were down almost 250 points in the morning. The advance/declines were positive. Is this the short covering rally that we're looking for in order to purchase some OEX puts? Could be. In bear markets we see strong rallies that spring up out of nowhere. Todays action qualifies under that criteria. Is today the end of the recent decline? Time will tell on that one but I'm inclined to think that we aren't done with the downside yet. I could be wrong and often am. GE was up 1/8 in reversal mode as well. Volume was heavy. I thought about putting in the order for the January calls but we are not yet at the price I'm looking for. We also have earnings coming out on October 21st which could complicate things. However I am going to get some calls at some point. Gold took it on the chin today, down over $40 on the futures. The XAU fell 6 1/4 but was lower during the session. ABX dropped about 1 1/2, GG down 1 3/4 and NEM lost 2 bucks. All had heavy volume and also cut their losses dramatically in the final hour of trading. I also considered putting in the orders for the November gold share calls as well. The daily candlestick charts are now looking positive for the gold shares. We are oversold and todays action looks like a bottom has been put in. That could all change tomorrow though in this volatile marketplace. That is just one of the problems here. You don't want to be too early. Mentally I'm doing OK. Fridays employment report still looms big at the end of this week. However a lot of the stock indice charts are now showing bullish candlestick reversals. I still might get some OEX puts before that report is released. Plenty of time left in the October cycle. Might be time for the gold shares as well but not if we get another down leg following Fridays employment report. Nothing is certain in this game as we well know. We'll see if we get any follow through to the upside tomorrow.

2011-10-03T13:08:00.000-07:00

Starting October where we left off in September as the Dow lost 258 points on good volume. The advance/declines were almost 10 to 1 negative. Index puts are the place to be and I don't own any. The premiums are still very high on the options. We've broken the consolidation in the S&P 500 to the downside. Now it is simply a question of how low we go. We haven't even gotten to Fridays employment number yet. So we'll see what happens. I have a couple of ideas longer term involving GE and the gold shares. I suppose I'll be looking for entry points. GE helped lead the way down today, off 1/2 and closing on its low for the day. Volume was good. I still want to get some January calls here. Gold had a good day with the futures up $35. The US dollar was higher as well in the flight to safety. The XAU fell 2 points though. ABX dropped 3/8, GG was flat and NEM gained 1/3. Volume was light here. I'd like to get some gold share calls eventually. I'm looking to go out to November. Plenty of time there. The Gold/XAU ratio is off the charts to the buy side but that indicator hasn't been working lately. Mentally I'm doing OK. Trying not to get caught up in not owning any OEX puts as we fall here. Perhaps there will be a short covering rally this week before the employment report. Wishful thinking there. I have a couple of ideas with the longer term GE call options for January and the gold share calls for November. The summation index has turned down again but it's been in a range lately with no extended moves. We'll see what happens tomorrow.

2011-09-30T13:23:00.000-07:00

More downside today as we ended near the lows for the week. The Dow lost 240 points on average volume. The advance/declines were 4 to 1 negative. I really feel as though we at at the edge of a cliff. We're at the bottom of the trading range and I think we will break it to the downside. Unfortunately I don't own any OEX puts yet as the premiums are very expensive with the recent volatility and 3 weeks left in the October cycle. I'll still try and get some before the employment report next Friday if we get some upside next week. But that may not happen. We're oversold here but that doesn't matter if we see a collapse. There aren't any reasons to buy stock here just yet. GE lost 2/3 on better volume. Probably getting ready to break down here as well. I'm going to get some January calls here next month. That has been the idea and I'm sticking with it. Gold was up $5 on the futures. The XAU was higher during the day but ended up only 1/2. ABX rose 3/8, GG gained a buck and NEM higher by 3/8. Volume was a little better today. The US dollar had a good day as money sought safety. However the flight to gold for safety is not happening at the moment. I am still going to get some gold share calls next month for the November cycle. We're oversold on the gold shares. However if we get the market collapse that I fear here, the gold shares will follow. Mentally I'm feeling tired, did not sleep enough. The stock indices cannot gain any traction to the upside. When we started the week with about a 600 point gain on Monday and Tuesday but couldn't hold it, that was telling. It isn't a good sign. Perhaps we can get one more short covering rally in the beginning of next week to buy some OEX puts. If not, I'll have to look at the other longer term call trades in GE and the gold shares. There is still plenty of time in the October option cycle. The VIX is pretty high here and if it continues upwards, look out. The market will go where it wants. I think next week could be very interesting. But for now it's Friday afternoon and time for a rest.

2011-09-29T13:14:00.000-07:00

An up and down day as we opened higher, went lower and then closed higher by 143 points on average volume. The advance/declines were over 2 to 1 positive. Not quite sure of what to make of todays session. The overall market was weaker than the Dow. I'd still like to own some OEX puts before the employment report in a week. The summation index is moving back and forth with no real trend at the moment. I still have the open order in for the OEX puts but I'll probably cancel it over the weekend unless it gets filled tomorrow. GE was up 3/8 on light volume. GE was a proxy again today as it never went negative even with the market selling off. GE is once again getting close to its 50 day moving average on the daily charts. It is something to keep an eye on. Gold was little changed on the futures today but did sell off last night before coming back. The XAU was up 1/3. ABX and GG gained 1/3, while NEM was up a buck. Volume was light. The US dollar didn't do much today. Perhaps the gold shares are trying to put in a bottom here. However if my market prognosis is correct, we will see lower prices in the coming weeks. I could be wrong. Mentally I'm feeling OK. We had every reason to sell off today but somehow made a comeback. This portends near term strength. The ideal scenario for me would be to purchase the OEX puts next Tuesday or Wednesday on market strength. That is probably wishful thinking. We have been going sideways for about 2 months in the stock indices. The breakout, when it happens, is something to be a part of. I still think it will be to the downside but the longer we wander around here increases my doubts of that. I still want some November gold share calls as well. Tomorrow ends the week, the month and the quarter.

2011-09-28T13:19:00.000-07:00

Back to the downside today as the Dow lost 180 points on average volume. The advance/declines were 5 to 1 negative. My guess is that the chance to purchase the OEX puts at a reasonable price has passed and we will be heading down from here. Monday and Tuesday were nothing more than a short covering snap back rally in retrospect. I think that we will be taking out the lows of support shortly. I could be wrong. I'd still like to be short ahead of the employment report next Friday. I'm leaving in my open order for the OEX October puts but it probably won't be filled. Perhaps I'll adjust the price. GE was off 1/3 on light volume. I'm expecting the recent lows to be taken out here as well. The game plan is to still get some January calls within the next month or so. Gold fell back $35 today and a bit more in the aftermarket. The US dollar was higher. The XAU dropped 8 7/8. ABX off 1 3/4, GG down 1 3/4 and NEM fell 1 7/8. Getting pretty oversold on the gold shares but the timing here will be the key. I'd still like the November calls at some point. Trying the October cycle here would entail more risk if we get the market selling off more as I expect. Mentally I'm feeling a bit frustrated. That is to be expected when what I was looking for shows up and I don't take advantage of it. I'll just have to take it from here. No hurry to get long at this point, however the gold shares are getting blown out to the downside. I really think we are about to have a precipitous fall in the stock indices. Stay tuned.

2011-09-27T13:06:00.000-07:00

The Dow took off to the upside today but pared its gains in the final hour. We closed the day higher by 146 points but we were up over 300. The advance/declines were almost 5 to 1 positive and volume was average. This should turn the summation index back to the upside. I placed an order for some OEX puts but it wasn't filled. I'm leaving it in overnight but I may be too late again already. No real news for the rally in the stock indices, just the hope that Europe ends up OK. Not overbought or oversold here on a short term basis. I'm a believer that puts should be owned at some point before the employment report next week. I could be wrong. GE was up about 1/4 on light volume. It too was higher earlier in the day. I'll keep an eye on GE as a proxy for the overall market. It has been a precursor of sorts lately. Gold bounced back today, the futures gained over $50. The US dollar had a weak day. The XAU was only up 1/4 after being much higher early in the day. ABX was up 1/4, GG was flat and NEM lost 7/8. Volume was light here. I think it is too early for a sustained up move in the gold shares here. That said, I would still like to own some November calls eventually. If the overall market falls as I expect, the gold shares should drop and that would be an entry point for the calls. Wishful thinking perhaps. Mentally I'm feeling OK, slept well. So we had a huge move to the upside in the stock indices and couldn't hold on. My order is in for some OEX puts but it may not get filled. The daily candlestick charts don't look positive for the stock indices with todays move. But that could all change tomorrow. End of the month on Friday. We'll see what happens overnight in Europe and go from there.