Just hanging around today for the Dow as it was up 32 points on heavy volume. The advance/declines were about 2 to 1 positive. The summation index is moving up. Digesting yesterdays stunning gains was the story for the Dow. The overall market was much stronger with the NASDAQ gaining almost 2%. The S&P 500 touched the 4000 level. Getting short term overbought there but not completely just yet. Resistance comes in at 4100 for the S&P and that is where the down trend line that began the bear market lies. We'll consider the SPY puts there perhaps. A break of that line would put the bear market to rest in my view. But we haven't gotten to that point yet. However the market action lately has certainly been positive and the seasonal strength may continue. Gold added $17 on the futures. The US dollar was lower and the bond market was closed for Veterans Day. The XAU added a point and GDX was up about a dime. Volume was average. The gold shares didn't move up much with gold going higher today and that isn't bullish. GDX is short term overbought but we haven't reached the measuring objective from the recent inverse head and shoulders pattern. I did sell the GDX November calls today. The exit could have been better intra-day but I did what I could. The gain for this trade was 1070% in less than 10 days. That's not a typo and results like that are why we focus on the options. But like any finished trade it doesn't matter now and you move on. I'll be looking for a move back towards the neckline in GDX for another chance at the calls there. We are still looking at the 30 level for GDX as the target for this gold share rally. Mentally I'm trying not to feel too bad about todays mediocre exit on the GDX trade. It is entirely possible that I should have simply held on to the position into next week. Hopefully I won't dwell on it all weekend. The VIX was lower and that fits with the overall market strength. Still short term oversold as the rally lives on. If the VIX can continue its oversold condition until the S&P 500 reaches 4100, we may have a set up for the SPY puts. There is an up trend line on the weekly VIX chart at the 21 level. The VIX currently sits at 22 1/2. It was a great week for stocks and now we have options expiration week on tap. If the positive bias shows up we could get to 4100 sooner rather than later on the S&P. We'll be going over the charts this weekend in hopes of finding the next trading opportunity. Europe and Asia were higher to finish the week with the exception of the FTSE. It's Friday afternoon and time for a rest.

The market exploded to the upside today as the Dow roared ahead by 1201 points on heavy volume. Yes, twelve hundred points higher in a single session. We are more used to big point days like this going lower. The advance/declines were 8 to 1 positive. The summation index continues to move up. The inflation data came in a bit lighter than expected and we had had a gap higher at the open. The NASDAQ was the leader today and was up over 7%. There's a potential double bottom there now on the daily chart. A break above 11250 on good volume would confirm the pattern. Perhaps it will happen tomorrow. The S&P 500 up trend line remains intact and the short term indicators there have now turned back up with some room to run. One economic report doesn't normally lead to such extreme price movement. However this is why we are reminded that markets go where they want, whenever they want. In either direction. We'll be looking for higher stock prices going forward. Gold was up around $40 today as the rally here continued. The US dollar was lower and interest rates dropped. The XAU gained 7 3/8, while GDX added almost 2 points. Volume was heavy to the upside. GDX is short term overbought. My GDX November calls are showing great profits at the moment. Although there are still six days left in the November option cycle I am seriously considering taking the profit tomorrow ahead of the weekend. There is more room to go higher according to the measuring objective of the inverse head and shoulders pattern. But GDX has been moving practically straight up for about a week now. I don't want to be too greedy. Mentally I'm feeling a bit tired. The VIX had a huge drop today with the big gain in stocks. Althought short term oversold, the indicators there have turned lower in oversold territory. The VIX seems to be saying that the rally in stocks has legs. I would expect to see some follow through to the upside in the market tomorrow. We'll see. Asia was lower and Europe higher in last nights trade. We'll keep an eye on the overnight headlines.

Stocks got sold today post election as the Dow fell 646 points on good volume. The advance/declines were 4 to 1 negative. The summation index is still moving up. Maybe the market didn't like the election results that are still in limbo for some races. Perhaps we're just selling off ahead of tomorrows inflation data. The NASDAQ led the way down. The short term indicators for the S&P 500 have turned back down. Those technical indicators are now mid-range so we could go either way from here. Price is right on the short term up trend line for the S&P. So after tomorrow we'll have a better idea of where we are going in the near term. I can't say that I have a good feel one way or the other for whatever the outcome is. We'll just have to wait and see what the market has to say. Gold dropped $8 on the futures. The US dollar was higher and interest rates a bit lower. The XAU fell 3 1/8, while GDX shed 3/8. Volume remains good here. Hopefully the gold shares are simply digesting the recent strong gains before moving higher. That would be to my benefit for the current GDX call trade. Or this could be the beginning of the move back to the neckline breakout for GDX at 25 1/2. Another possibility is that the recent rise is over and we're about to move back down towards the 50 day moving average. GDX remains short term overbought but can stay that way if this is an extended rally. We'll know more after tomorrows inflation data is digested. Not sure how much longer that I'll hold on to this trade. The current technical analysis says to hold on. Mentally I'm feeling OK. The VIX was higher today and that fits with the down draft that we saw in stocks. The short term indicators have turned up but remain oversold and have plenty of room to go higher. This would suggest that we're about to see a sustained decline for stocks. Hasn't happened yet and the VIX remains below its 200 day moving average. Not sure what to expect next here but just like the market things could go either way. Asia and Europe were lower overnight. All eyes on tomorrows inflation report.

Another back and forth session with Dow gaining 333 ponts on good volume. The advance/declines were positive. The summation index is moving higher and should pass up through the zero line today. Once again stocks were led by the Dow which has been the theme of the current rally. That isn't the most positive backdrop but the bulls will take it. The short term indicators for the S&P 500 have turned back up and the near term up trend line there remains intact for now. What we really need to see is some strength from the small caps and NASDAQ to feel good about the current rise. We need to get through the election results and the consumer price information as well. Any negative surprises will derail the recent buying. Technically it's a mixed picture with the big caps overbought and the small cap indicators mid-range or lower. Never any easy answers in this game. Gold rallied again with the futures up almost $35 and now above $1700. The US dollar was lower again and interest rates dropped. The XAU was up 5 1/2, while GDX gained 1 1/2. Volume was heavy again to the upside for the gold shares as money is now finding a home there. More importantly the rise in GDX went through the neckline of the inverse head and shoulders which validates that pattern. The measuring objective is up near the 30 level. I'm not sure that I can hold on to the GDX calls that I have for that long. There's only a week and a half left in the November option cycle. GDX is also now short term overbought. The next technical expectation of the pattern is a return to the neckline. That isn't always the case but it does happen often enough to be aware of. It does give traders a chance to hop on board before continuing higher. We'll see how things play out for GDX. Needless to say the GDX calls that I have are showing a good profit. Mentally I'm feeling OK. The VIX was higher today and that doesn't coincide with an up market. This indicator hasn't made sense to me for quite a while. It is not acting in the usual fashion. The short term indicators have now turned back up but the VIX is still oversold. If the indicators continue higher we should see a near term decline in stocks. Hasn't happened yet but it is something to be aware of. Perhaps we'll see some selling tomorrow ahead of the inflation data. That's just a guess on my part. My focus will be on the gold shares. Europe was higher and Asia mixed overnight. We'll see what tomorrow brings.

The Dow continues its climb as the most watched index gained 423 points on good volume. The advance/declines were shy of 2 to 1 positive. The summation index is moving up and getting closer to the zero line. The Dow was the leader again which has been the case in this recent rally. The short term indicators for the S&P 500 are starting to move back up but not in a pronounced way. The big caps are leading the small caps and that's a sign of risk aversion. The trend remains up for now on the S&P. Here we have near term tops above tops and bottoms above bottoms for now. Waiting on Thursdays inflation data. Gold finished about flat on the futures. The US dollar was lower and interest rates moved up. We should have seen more positive price action for gold with the drop in the dollar. The XAU and GDX had slight fractional gains on good volume. We're on the cusp of breaking through the neckline of the inverse head and shoulders pattern for GDX. Perhaps we'll stall here for a bit before turning higher. Or we'll break down from here and the pattern will fail. I'm hoping for the former. My GDX November calls are still comfortably in the black. Mentally I'm feeling OK. The VIX was a bit lower today and now is extremely short term oversold. Not sure how much longer that condition can continue. But I haven't been able to figure out what's happening with the VIX for a while now. We'll just have to wait and see where we go from here. Election day tomorrow and I'm not sure it will have that much impact on stocks. Gridlock would be preferred by the market as always. Asia and Europe were both up overnight with the exception of England. We'll keep an eye on tonights developments.

It was a back and forth session for much of the day until the market decided that it wanted to go higher. The Dow gained 401 points on heavy volume. The advance/declines were better than 2 to 1 positive. The summation index is moving up. The jobs report was better than expected and we bounced around after that. One day doesn't make a rally though. The S&P 500 is still below its 50 day moving average. The short term technical indicators are around mid-range and moving sideways after todays price action. If we can continue higher from here the S&P chart would look a lot more constructive. There would also be a potential double bottom on the NASDAQ daily chart. But we will have to see where things go from here. Inflation data out next Thursday but we're a long way from that. Gold had a dramatic move to the upside as the futures soared over fifty bucks. The US dollar dropped and interest rates were mixed with little change. The XAU gained 9 1/3, while GDX was up 2 1/4. Volume was heavy to the upside. GDX is now approaching the neckline of the inverse head and shoulders pattern that comes in around 25 1/2. If we can get through the neckline on good volume GDX will be moving higher. Some of the short term indicators here have turned back up. The GDX November calls that I have are showing healthy profits but this trade isn't over yet. We all know by now markets can go either way in a hurry but the entry on this particular trade looks like it was ideal. But just like the overall market one day doesn't make a trend. Plenty to ponder over the weekend. Mentally I'm feeling pretty good after this recent trade appears to be working out. However I can't let that mood affect me as the trade still has to be managed properly. Up or down, win or lose an even keel will go a long way to producing solid results. Not always easy to do though. The VIX was lower and that fits with an up market. Still short term oversold and staying that way. Not sure how much longer that will last but sometimes it's longer than you think. Impossible to know if this is one of those times. We'll be checking the charts as usual over the weekend. A holiday next week on Friday for the bond market. Europe and Asia were higher with the exception of Japan last night to finish the week. It's Friday afternoon and time for a break.

Some follow through downside today as the Dow dropped 146 points on good volume. The advance/declines were negative. The summation index is still moving up. We sold off hard early today and then spent the rest of the session moving sideways. Once again the NASDAQ led the way down. We'll get the jobs report tomorrow and I'm not sure that will turn things around. The short term indicators for the major averages have turned down and they're not oversold yet. Some of the indices are holding up better than others but the NASDAQ lagging it certainly isn't a very bullish backdrop. Selling off into the close is not a positive. So we'll see how things shake out tomorrow. Gold fell $15 on the futures. The US dollar was higher along with interest rates. The XAU dropped 2 1/4, while GDX shed over 1/2. Volume was good to the downside. I did end up purchasing some GDX November calls. They are at break even. It looks like a decent entry if we can get some kind of bounce from here in GDX. Not completely short term oversold yet here although one of the hourly chart indicators says it's time to buy. I do not plan on holding this trade for long depending on how it goes from here. The breakdown in both NEM and GOLD is not encouraging. However an oversold bounce is not out of the question. Mentally I'm feeling OK. The VIX once again was lower with a decline in prices. This doesn't fit the normal pattern for this indicator. I don't know why it's acting strangely lately. The VIX remains oversold yet stocks are going lower. Not sure what to expect with the VIX going forward. So we are now in the next trade and I'm not really sure if this was a good idea. The fundamentals for gold remain in place as negative. The reverse head and shoulders pattern for GDX appears to be forming a second right shoulder. But if GDX doesn't hold in here, the pattern will fail and this trade will probably end up a loser. So what happens with GDX tomorrow should be pretty important for the outcome of this trade. We'll see. Europe and Asia were lower last night. We'll close out the trading week tomorrow.

Back to the downside after the Fed as the Dow fell 505 points on heavy volume. The advance/declines were bettern than 3 to 1 negative. The summation index is moving higher. We got another signal last night for a big move from the McClellan oscillator and we got it today. The Fed raised rates as expected but the market didn't like what it heard after the fact. The NASDAQ led the way lower and has been under performing for quite a while. Short term indicators for all the major averages have turned down with still more room to move lower. The NASDAQ looks like it wants to test the October lows. Other indices, not so much. The short term up trend line on the S&P daily chart has been broken. It looks like we'll be heading lower in the short term. Gold fell ten bucks on the futures. The US dollar was higher along with interest rates. The XAU lost 6 1/4, while GDX dropped 1 3/8. Volume was heavy to the downside for the gold shares. They were underperforming the metal today as they chased the overall market lower. My open order for the GDX November calls wasn't hit. Not sure if this is the best idea after today. GDX could be forming another right shoulder on the inverse head and shoulders pattern. Or not. NEM broke its near term support today and is not completely oversold yet. Barrack Gold reports its earnings tomorrow and is close to breaking support as well. I'll have to look things over again tonight and decide what to do. Mentally I'm feeling OK. The VIX once again barely moved and we had a huge decline in stocks. This makes no sense at all. My concern is that if the VIX does start to go higher here we are going to see quite a decline in the market. It is another reason to perhaps take a step back here when it comes to the option trading. But you don't make any money on the sidelines. However you don't lose any either. Something weird is happening with the VIX but I don't know what it is. Plenty to ponder tonight to decide what to do. Asia was generally higher and Europe lower overnight. We'll keep an eye on tonights developments.

We had a one day reversal to the downside today as the market opened higher and closed lower. The Dow lost 79 points on average volume. The advance/declines were positive. The summation index continues higher. Waiting on the Fed. The NASDAQ is still the leader to the downside but not with the gusto that we have seen in the previous couple of months. The tone of the market has changed with the recent upswing. The S&P 500 continues to be short term overbought. We'll get the Fed tomorrow and we'll see how the market reacts to that. Then we'll have to get through the employment report on Friday. The trend is up as we have highs above previous highs and an up trend line in place for the S&P. Resistance is at 4100. Gold was up ten bucks on the futures. The US dollar finished little changed and interest rates were slightly higher. The XAU gained 2 1/8, while GDX was up 1/2. Volume was average. At this rate my open order for the GDX November calls won't get filled. Might have to adjust it again. Mentally I'm feeling OK. The VIX was a bit lower today which doesn't fit with a down market. Oversold and staying that way. I don't want to guess when the VIX will turn back up as it can stay oversold for extended amounts of time during rallies. I do think however that each passing day gets us closer to a move higher in the VIX. That means some selling for stocks and more than the little dips we've seen during the recent move higher. For now it's all systems go for more upside but that could change tomorrow. We'll see. Asia and Europe were both up overnight. We'll see what tomorrow brings.

Taking a step back on the final trading day of October as the Dow lost 128 points on good volume. The advance/declines were slightly negative. The summation index is moving up. The NASDAQ led the way lower but there doesn't seem to be lot of conviction here. The S&P 500 is still short term overbought. It's all about what the Fed has to say on Wednesday as the widely expected rate hike is already accounted for. So we'll just have to wait and see. I would not expect a lot of price movement ahead of the Fed but I've been wrong before. So we're in a wait and see mode for now. Gold was off $8 on the futures. The US dollar was higher along with interest rates. The XAU lost 1 1/2, while GDX shed 1/2. Volume was average. I canceled my open order and replaced it with another that is closer to the money for the GDX November calls. It will take some decline to get filled. The short term indicators for GDX have now rolled over and it will take a few days to get back down to oversold if it gets there. NEM reports earning tomorrow and that will move GDX one way or the other most likely. Remaining patient for now and might consider abandoning this idea as the week moves on. Mentally I'm feeling OK. The VIX was slightly higher and remains short term oversold as it hangs around the 200 day moving average. If it breaks away from the 200 day to the downside, the rally will continue. If not then the selling will return. I'm still leaning towards higher prices going forward with the summation index heading higher at the moment and getting closer to the zero line on this upswing. But we'll see what the market has in store for us. Asia was mixed with Europe higher to end the month and start the week. We'll keep an eye on tonights headlines.

The market exploded to the upside today as the Dow gained 828 points on good volume. The advance/declines were around 3 to 1 positive. The summation index is moving higher. Last night we got a signal from the McClellan oscillator for a big move within the next two days. Todays price action fulfills that. The inflation data today was within expectations. There was a huge move up in AAPL on the earnings but the earnings were nothing to write home about. Perhaps after all the negative earnings reports from the other big cap tech stocks it was a relief that AAPL wasn't as dour. Whatever the case it certainly doesn't explain such a huge move up in stocks. This is why we often say that the market will go where it wants. It is also why we stick to the technical factors to make our decisions. The S&P 500 closed above its 50 day moving average and remains short term overbought. It can remain short term overbought during rallies and we're in one now. Sellers have left the building. The NASDAQ led the way and that's a plus. The next down trend line for the S&P comes in at 4100 and it is a major one. The trend is up until proven otherwise. Gold was down $17. The US dollar was slightly higher and interest rates rose. The XAU and GDX had fractional losses on light volume. Once again the gold shares out performed the precious metal and that is bullish. I am leaving out my open order for the GDX November calls. GDX is short term overbought here but if can stay that way as well if this is indeed a rally in the gold shares. The inverse head and shoulders pattern is still in place. Mentally I'm feeling OK. The VIX continues to drop and is now below its 200 day moving average. Oversold and staying that way. 20 is the level to watch on the VIX and we are still a long way from there. As always the market can turn on a dime. However with the rising summation index coupled with the declining VIX you cannot argue with where prices are heading. The only caveat is that the rally that began a couple weeks ago came out of nowhere and that is classic bear market action. We'll be checking the charts over the weekend as usual. Asia was lower and Europe mixed to finish the week. It's Friday afternoon and time for a break.

Another mixed market as the Dow was up 194 points on good volume. The advance/declines were positive. The summation index is moving up. Once again the overall market was much weaker than the Dow with both the S&P 500 and NASDAQ posting losses. The NASDAQ led the way down again as tech earnings continue to disappoint. GDP came in better than expected. The S&P 500 is still short term overbought and the indicators appear to be rolling over. Tomorrows inflation data should provide short term direction for stocks. The small stocks have already started to head lower. The Dow has been the leader and that is not usually a positive. Big cap tech is heading lower. So you can see that it's a mixed bag when it comes to the stock market at the moment. Gold was off a few bucks on the futures. The US dollar was higher and interest rates continued to drop. The XAU fell 1 1/2, while GDX shed around 1/3. Volume was average. I did place another order for the GDX November calls and I'm leaving it out there again. As long as the inverse head and shoulders pattern remains intact I'm willing to try and take a chance with this trade. Mentally I'm feeling OK. The VIX was up just a touch as it hangs around its 50 day moving average. Still short term oversold here. Not sure what to expect next from this indicator. At this juncture we'll just wait and see how the market reacts to the data out tomorrow and take it from there. We were looking for a pause in the rally and so far we've gotten that. Whether or not it turns into something else remains to be seen. As long as the summation index is moving up the path of least resistance is higher. Europe and Asia were mixed in last nights trade. We'll close out the week tomorrow.

Weakness in general today but the Dow did manage to move up a couple of points on heavy volume. The advance/declines were positive. The summation index is moving higher. Tech earnings reports came in disappointing, leading the the NASDAQ to having an over 200 point decline. The S&P 500 was lower as well. It has stalled at the 50 day moving average and remains short term overbought. Would not be surprised for the market to take a rest here but you never know. We'll get a look at 3rd quarter GDP tomorrow and that should be a market mover. The inflation data out on Friday certainly will be. Gold was up over ten bucks on the futures. The US dollar continues to drop along with interest rates. The XAU gained 3 1/4, while GDX was up 3/4. Volume was average. I canceled my open order for the GDX November calls as GDX has already moved up from its recent low. GDX is already close to the neckline of the inverse head and shoulders pattern on the daily chart. If we get some pullback from where we are I might consider chasing this trade. The measuring objective from the pattern is 30 and GDX is around 25. But the ideal time to take the position has passed. Mentally I'm feeling a bit frustrated for missing out on the GDX call trade. However you've always got to make adjustments in the game and this could be one of those times. I might put in another order overnight. The VIX was lower today and closed below its 50 day moving average. This does not match up with a weaker overall market. The VIX is now short term oversold. Not sure what to expect next from this indicator or what the chart now implies. It does remain oversold during rallies but I'm thinking this short term stock market rally needs a rest. I could be wrong and often am. Europe and Asia were higher overnight. We'll keep an eye on tonights developments.

Continuing to move higher as the Dow gained 337 points on heavy volume. The advance/declines were 5 to 1 positive. The summation index is now moving up. The NASDAQ was the leader today and that's a plus. The S&P 500 broke through the down trend line at 3800 on good volume. We are now short term overbought on the S&P and also at the 50 day moving average. A pause here would not be out of the question. But it appears that buyers have taken control now. We do have the GDP report on Thursday and inflation data on Friday to get out of the way. However I think it's safe to say that the decline is done for now. Gold was up around 5 bucks on the futures. The US dollar was lower along with interest rates. The XAU was up 1 1/2 and GDX up 1/2 on good volume. My open order remains in place for the GDX November calls but it looks like it won't get filled at this point. Another missed trade perhaps. Mentally I'm feeling OK. The VIX was lower with fits with todays stock gains. Short term oversold now but the VIX remains that way during rallies. We'll see how long this can last. The tone of the market has changed as sellers are now not to be found. But we all know that can change in a day, an hour or a minute. However the recent evidence now favors the bulls. Europe was higher and Asia mixed again overnight. We'll see how it goes tomorrow.

The rally lives on as the Dow climbed 417 points on good volume. The advance/declines were positive. The summation index is still trying to turn back up here. The S&P 500 is almost at the next resistance line at 3800. Getting short term overbought here now though. The Dow led the way today and that isn't the most bullish scenario. Plenty of earnings due out this week so we'll get some moves one way or the other. For now it looks like the sellers have retreated. Gold dropped a couple bucks on the futures. The US dollar finished little changed and interest rates were mixed. The XAU shed 1 1/3, while GDX lost 3/8. Volume was average. I did place another open order for the GDX November calls and I'm leaving it out there. Not as close to being in the money as I'd like it to be but the premiums are inflated as we've just rolled into the November option cycle. If it does get filled and the head and shoulders pattern on the daily GDX is valid the trade will work. Unless I mismanage it again of course. Mentally I'm feeling OK. The VIX was up slightly which does not coincide with a market up over 400 points. Somewhat short term oversold on some of the technical indicators here. Not sure what's going on with the VIX here. That's been the case for a while now with this indicator. Europe was higher and Asia mixed to start the week. We'll keep an eye on the overnight headlines.

Markets climbed higher today as the Dow soared 748 points on expiration heavy volume. The advance/declines were better than 2 to 1 positive. The summation index is making a sideways channel. I was looking for lower prices today and was wrong. The short term indicators for the S&P 500 have now turned back up. Not sure how to explain todays price action. Short covering perhaps or maybe option related buying on the expiration. Or a combination of the two. The next down trend line for the S&P is at 3800. If we can get through there the picture will change and this down leg will be completed. Hasn't happened yet but after todays price action you get the feeling that it will. But we'll wait and see what happens next week. Gold was up over $20 on the futures. The US dollar was lower along with interest rates. The XAU gained over 5 points, while GDX was up 1 1/8. Volume was good to the upside. I canceled my open order for the GDX November calls as it was not going to get filled after GDX took off to the upside at the open. The inverse head and shoulders pattern for GDX now looks valid again and I'll be looking to purchase those Novermber calls on any pullback but it may already be too late. This looks like a trade that should be chased as the measuring objective for the head and shoulders pattern comes in around 30. GDX is currently at 24 and change. I'll try and figure out what to do over the weekend. Mentally I'm feeling a bit frustrated for not buying the GDX calls this week. Although my orders were out there they didn't come close to being filled and adjustments needed to be made. I guess I just didn't have the faith that the pattern would hold up but it has for now. The VIX was slightly lower today. Some of the short term indicators here are getting oversold but aren't quite there yet. The VIX has broken the short term up trend line on the daily chart and that implies more rally to come. It is another reason that we could be in the midst of a change in the medium term direction of the market. We'll learn more as we go forward. Today was another one of those rallies out of nowhere though. Plenty of charts to check over the weekend as usual. Asia and Europe were generally lower to finish the week. It's Friday afternoon and time for a break.

The selling continued today but it wasn't too bad as the Dow 90 points on good volume. The advance/declines were better than 2 to 1 negative. The summation index is still trying to stabilize here. The market action now seems more option expiration related than anything else. The short term indicators for the S&P 500 are starting to roll over here though. Stock market indices here in general have been moving sideways for a month. A rollover here could lead to new lows or at least another test of the recent ones. Hasn't happened yet but the TRAN was pretty weak today. We'll have to see what the market has in store for us but lower prices would not be a surprise. Gold finished off a couple bucks on the futures after being higher earlier in the day. The US dollar was slightly lower and interest rates continue to rise. The XAU was up 1 1/3, while GDX added about 1/4. Volume was average. The gold shares were off of their highs as well but did finish in the black and outshined the metal once again. I do continue to have an open order out for the GDX November calls but I moved it to a closer to the money strike price. The inverse head and shoulders is still valid on the GDX daily candlestick chart but any downside in the gold shares from here will kill that pattern. Mentally I'm feeling a bit tired. The VIX was lower today despite a drop in stocks and that doesn't fit. The VIX did close below the up trend line that has been in place since mid-August. I'm not sure exactly what to expect from the VIX now. Tomorrows results will probably tell us a lot. Even though stocks were lower today is wasn't led by the NASDAQ and that's a small plus for the bulls. Technical indicators look like they want to roll back down here but haven't yet. Not sure what to expect tomorrow but I'm leaning towards the downside. It's expiration Friday and anything goes. Europe up and Asia down overnight. We'll close out the trading week tomorrow.

Sellers returned today as the Dow fell 100 points on average volume. The advance/declines were better than 3 to 1 negative. The summation index is beginning to track sideways. The NASDAQ was a slight leader but the volume wasn't all that much. The short term indicators for the S&P 500 are starting to stall their upwards movement. I'm not sure where we go next. The fundamental backdrop with higher interest rates remains. We won't be making any SPY option trades this week. It is the sidelines in that regard for now. Gold fell over twenty bucks on the futures and appears to be about to make a new low for the year. The US dollar was higher along with interest rates. The XAU lost 2 3/4, while GDX shed about 3/4. Volume was light. Another day like today and the inverse head and shoulders pattern on the daily GDX chart will be negated. It looks like that's where we're headed. I did adjust my open order for the GDX November calls but I may just cancel it and move to a closer to the money strike price. If gold doesn't hold in here we'll most likely be heading to $1600. Perhaps forgetting about gold here would be the best strategy. We'll see. Mentally I'm feeling OK. The VIX was slightly higher today and the short term technical picture remains the same. The Bollinger bands are starting to get closer together which implies a big move coming one way or the other. We'll remain patient for now with only 2 days left in the October option cycle. Not to mention the inflated premiums for the November SPY options as there is plenty of time left in them. Asia was mixed and Europe slightly lower last night. We'll keep an eye on the overnight headlines.

We saw some upsiode follow through for a change as the Dow gained 338 points on good volume. The advance/declines were better than 2 to 1 positive. The summation index is trying to turn around here and has stopped moving lower for now. The Dow was the leader today and that is not the most bullish scenario. We opened with a huge gap up higher to start and worked out way lower from there for the rest of the session. The short term technical indicators for the S&P 500 are now around mid-range so it could go either way from here. So far the positive expiration week bias has been in effect. But as we've seen lately, the market can turn on a dime. Not a lot of economic data this week but plenty of earnings. It is looking like we'll let this week pass for the S&P option trades and then go from there. Only 3 days left in the October option cycle. Gold was off $7 on the futures. The US dollar and interest rates were both little changed. The XAU and GDX both had fractional gains on light volume. The gold shares out performed the metal itself again and that's bullish. I have an open order out now for the GDX November calls. If it gets filled I will make it a point to do a better job than the disastor that was the last trade there was. We'll see. The potential inverse head and shoulders pattern for GDX is still there but it will have to get moving to the upside soon for it to work. Mentally I'm feeling OK. The VIX was lower with stocks higher and that fits. We got even closer to the 30 level for the VIX today and a break below there will certainly empower the bulls. Hasn't happened yet and the VIX could just as easily move back up tomorrow. Interesting times. We'll be keeping a close watch on this indicator for clues on the markets direction as things have the feeling of at least a short term break from the recent constant selling. Europe and Asia were higher overnight. We'll see how things go tomorrow.

A rally out of nowhere to begin the week as the Dow was up 550 points on good volume. The advance/declines were 5 to 1 positive. The summation index is trying to stabalize. The NASDAQ led the way and that's a plus. Volatility is the rule with the market trying to regain some footing here. Perhaps the positive expiration week bias will take effect. The short term indicators for the S&P 500 have turned back up with room to move higher. But we do have down trend lines in charge on most of the major index charts. Until they are taken out the trend is down. We are right at the first short term down trend line for the S&P. If we can move higher from here the next is at around 3800. Gold was up $7 on the futures. The US dollar was lower and interest rates were mixed. The XAU was up 2 2/3, while GDX rose 3/4. Volume was light. The potential inverse head and shoulders pattern is still there on the daily candlestick chart for GDX. I'm now considering the November calls there. Might place an overnight order. Mentally I'm feeling OK. The VIX was lower today and the short term indicators are mid-range again. So we could go either way here. There is an up trend line on the VIX daily chart that comes in at the 30 level. If we can somehow break down through that line we would see a more sustained rally in stocks. The VIX is a bit over 31 as of the close today. However there's nothing stopping the VIX from moving higher and stocks heading lower either. That has been the pattern since the middle of August. But we are moving into a seasonally favorable period for stocks even though it is the beginning of 3rd quarter earnings reports. I guess we'll just try and get through expiration week and go from there. Europe was higher and Asia mixed to begin the week. We'll keep an eye on the overnight developments.

Back to the downside as the Dow fell 403 points on average volume. The advance/declines were 4 to 1 negative. The summation index continues lower. After breifly being in positive territory at the start, the market moved lower all day. Yesterdays big gain was a mirage. The NASDAQ led the way lower. The short term indicators for the S&P 500 turned back down. At this point I think the best we can hope for next week is sideways instead of straight down. Bank earnings were mixed. Retail sales were flat which missed expectations. The daily candlestick chart for the S&P now posts a bearish configuration. We could not build on yesterdays gains. Options expiration week will be upon us. Anyones guess which way things will go. The usual positive market bias there will be hard to come by in this bearish atmosphere. Gold was off $28 on the futures. The US dollar was higher along with interest rates. The XAU dropped 4 1/2, while GDX was down a point. Volume was average. I dumped the GDX October calls for about an 80% loss. Selling yesterday would have resulted in an acceptable 50% loss. Obviously should not have waited. This trade was a disastor. The entry was horrible, then it showed a decent gain which I let turn into an unacceptable loss. So it checked off all the boxes for a terribly managed trade. Not sure what my train of thought was there or if there even was any. We'll put it behind and move on. I might even try the GDX calls again next week for a short term trade. Mentally I'm feeling OK. The VIX finished unchanged on the session which makes no sense whatsoever. A big move down for stocks and no movement on the VIX? I have no idea what is going on with this indicator. The VIX is in a solid uptrend though and that could make for a rocky week for stocks coming up. The VIX is overbought on a weekly basis. Options expiration week with more earnings reports on tap for next week. It won't be boring. I'll be checking the charts as usual over the weekend and see if I can find a trade for next week although the short term trades are not exactly my best ideas sometimes. Volatility will certainly be something to consider. Europe and Asia were higher to close the week. It's Friday afternoon and time for a break.

Volatility with a vengeance as the Dow opened down over 500 points lower and then finished the day up 827 points on heavy volume. The advance/declines were better than 2 to 1 positive. The summation index is still moving lower. We got a signal last night on the McClellan oscillator for a big move within the next couple of sessions and we certainly saw it today. The inflation data was worse than expected which explains the early sell off but I can't say there's any reason for the rally. We were looking for an oversold bounce and we got it. Rallies out of nowhere are classic bear market traits. However todays price action has the makings of an exhaustion to the downside, which would mean higher prices going forward for a more extended period of time. That's my best guess at the moment. A market that rallies on bad news is also usually bullish. The short term techncial indicators for the S&P have turned up. We'll have to see if there is any follow through tomorrow. The NASDAQ wasn't the leader today. It was one of the wilder days on Wall street. Gold was off $6 on the futures. The US dollar was lower and interest rates were up. The XAU and GDX had fractional losses but came back from their lows of the session just like the overall market. Volume was good. The short term indicators for GDX are still mid-range. My GDX October calls are solid losers and they're running out of time. Not sure why I'm still holding this position but I'm thinking that it has a chance to reach break even. We'll see. The trade has already been poorly executed and a part of me also thinks it's time to take the loss and move on. Nothing comes easy in this game. Mentally I'm feeling OK. The VIX was lower and the short term indicators have turned down. We'll see where it goes from here. The daily chart looks like it wants to go lower which would imply more upside for stocks. But I haven't been able to figure the VIX out lately. We'll get a look at retail sales tomorrow along with some bank earnings. Asia lower and Europe higher last night. We'll close out the trading week on Friday.

Inflation data failed to have a big impact as the Dow was off 28 points on lighter volume. The advance/declines were negative. The summation index is moving down. The producer inflation data was a bit higher than expected but it did not cause any massive selling that we've seen lately with these reports. We'll see what happens with the consumer number tomorrow. The S&P 500 remains short term oversold. I'm expecting a short term bounce in the stock indexes but it hasn't happened yet. I suppose there's always a chance that things will fall apart again tomorrow if the inflation data comes in worse than expected but that is not what I'm looking for. Most of the major stock indices are oversold and some have potential positive RSI divergences. So we'll see how it goes. Gold was off about $5 on the futures. The US dollar finished flat and interest rates were a bit lower. The XAU and GDX had fractional moves higher on light volume. The short term indicators for GDX remain mid-range. My GDX October calls are still sporting a small loss. GDX could be forming an inverse head and shoulders pattern on its daily candlestick chart. Or that could simply be wishful thinking on my part. We'll know in due time. Mentally I'm feeling OK. The VIX finished flat on the day. The short term techniclas remain overbought. The 50 day moving average here has just crossed through the 200 day which implies higher VIX readings going forward. Which in turn means more volatility and lower stock prices. However we'll just have to wait and see what the market decides to do here. Europe and Asia were both lower again as there are no buyers for now. We'll see how the market reacts to the inflation data on Thursday.

It was a mixed bag today as the Dow was higher and the overall market was lower. The most watched index added 36 points on good volume. The advance/declines were negative. The summation index continues lower. The NASDAQ was the downside leader and that is not a plus. The S&P 500 remains short term oversold and is on the cusp of making new lows. We'll get the producer inflation numbers tomorrow and my guess is that is won't be as bad as anticipated. But that's just a guess. The NASDAQ closed on a new low but the Russell 2000 is holding up better than the rest. The Russell led the way down and now could be the canary in the coal mine for at least a short term rally here. But we'll know more as the week unfolds. Regardless, we're still in the grips of a bear market. Gold was off a couple bucks today. The US dollar was a bit higher and interest rates a touch to the upside. The XAU and GDX had fractional losses on better than average volume. The short term technical indicators for GDX are now mid-range, so we could go either way here. The near term will be directed by the reaction to the inflation data. My GDX October calls are now back in the red. I have certainly rode this trade up and down and that is a recipe for disastor. Mentally I'm feeling OK. The VIX was up today and is getting to short term overbought but not there yet. Hard for me to figure out what the VIX means lately. The only thing for sure is that it implies more volatility going forward. I do think that it is an opportune time to put some longer term funds to work here and I did just that today. It would be pretty lucky to catch the bottom of this bear but my thought today is that we'll be higher than todays close by the end of the year. I could be wrong and often am. But with the longer term money you don't have to be completely exact and you have time on your side unlike the options trading. Both Europe and Asia were down. We'll see how it goes tomorrow.

We did not get the significant downside follow through to Fridays selling today as the Dow ended lower by 93 points on light volume. The advance/declines were 2 to 1 negative. The summation index is moving down. It was basically a day of hanging around as the market could not find a direction of travel. The NASDAQ did lead the way lower as the overall market was weaker than the Dow. Getting short term oversold for the S&P 500 but not completely there yet. It also looks like the short term indicators downward movement is starting to stall here. Waiting on inflation data due out Wednesday and Thursday. Gold was down $35 on the futures. The US dollar was up and the bond market was closed for a holiday. The XAU lost 1 3/8, while GDX shed over 1/3. Volume was light. Considering the drop that we saw in gold, the gold shares held up rather well. Not sure what it means going forward but the gold shares continue to out perform the metal itself. My GDX October calls are now back to where I bought them. I have obviously held on to this trade for too long as the management of it has been abysmal. Less than 2 weeks left in the October option cycle. The short term indicators for GDX continue to move lower. Mentally I'm feeling OK. The VIX was higher today but came back from its best levels of the session. The short term technical indicators here are pointing up. The 50 day moving average is about to cross the 200 day to the upside on the VIX which would imply more volatility and lower stock prices. We'll see. Europe and Asia were lower to begin the trading week. We'll keep an eye on the overnight headlines.

The market got whacked today as the Dow fell 630 points on good volume. The advance/declines were around 6 to 1 negative. The summation index is starting to move lower. The jobs report was a bit better than expected but not by much. That gave sellers some ammo I guess as we had a gap lower at the open and continued down from there. The NASDAQ led the way and that's a plus for the bears. The short term indicators for the S&P 500 have rolled over. After a huge start higher to begin the week, we are ending with a thud. It kind of has a feel as if things might just start to fall apart but we are already oversold for an extended period of time. I'm not sure what's next for the market at this stage. Gold dropped almost twenty bucks on the futures. The US dollar was up and interest rates rose as well. The XAU lost 5 points, while GDX shed 1 1/4. Volume was good to the downside. I don't know why I'm still holding on to the GDX October calls that I own. The short term indicators for GDX have now rolled over and have plenty of room to go lower. There is still two weeks left in these options but after today you have to think that gold is going lower with the overall market. I still have a price target that I thought would be met before expiration but this obviously could be wrong. The trade is still showing a small profit and I probably should have taken that today and been done with it. It looks like there could be a lousy exit for this trade to go with the lousy entry. Mentally I'm feeling OK. The VIX was up today but not as much as you would have expected with the market tanking like it did. The short term indicators here are around mid-range still. I'm not sure what we have going on with this indicator right now either. I will have to regroup over the weekend and try to figure out what to do next. With a couple of weeks to go in the October option cycle, there's still plenty of time to come up with a SPY trade. However with the market acting as it is at the moment and my inability to figure things out the sidelines might be a better idea. I will have to come up with a strategy for the current GDX call trade though. Plenty to ponder in the next couple of days. Europe and Asia were lower to end the week. It's Friday afternoon and time for a break.

Some selling ahead of the employment report as the Dow fell 346 points on average volume. The advance/declines were better than 2 to 1 negative for the second day in a row. The summation index is now tracking sideways. Not a huge decline or one to worry about in my mind as the NASDAQ wasn't the leader. The short term indicators on the S&P 500 are stalling at the mid-range level. So you could make a case for going either way here. We'll get the market reaction to the jobs report tomorrow and go from there. Gold finished flat on the futures. The US dollar was higher along with interest rates. The XAU was up a point, while GDX added 1/4. Volume was a bit above average. Some of the indicators for GDX are short term overbought. During rallies the indicators can remain overbought as price moves higher. That is the situation that I believe we're in with regards to GDX. I have an upside target there but we haven't reached it yet. Since there is still 2 weeks left in the October option cycle, I've decided to hang on to this trade for now. It is still in the black. Mentally I'm feeling OK. The VIX was up today and that fits with a market decline. However the VIX moved a lot higher than todays minor volatility would normally suggest. Not sure what that implies. The short term technical indicators for the VIX are starting to turn back up. The stock market has stalled after the huge gains to begin the week. That is not unexpected. How we close the week out will be important. More selling tomorrow will put into question the recent bottom. If we have a positive session it will be a plus for the bulls. At this point all we can do is wait and see. Asia was higher and Europe lower overnight. We'll close out the trading week tomorrow.

A pause in the upside today as the Dow fell 42 points on average volume. The advance/declines were around 2 to 1 negative. The summation index is trying to turn around to the upside and I suspect that it will be successful. Digesting the huge gains of the first two days of the week is what I think we have going on here. We opened with a gap lower but unlike recent market action todays decline was met with buyers that eventually took the market higher before dropping back down near the close. The short term indicators for the S&P are still moving up and have room to go higher. It feels like some type of bottom has been put in. The question remains whether or not this is the end of the decline that started in the beginning of the year. Tomorrow should be a waiting for the jobs report kind of day. Gold dropped $5 on the futures. The US dollar was higher along with interest rates. The XAU fell around 1 1/2, while GDX shed 1/3. Volume was better than average. GDX is now hanging around its 50 day moving average. My GDX October calls lost some ground and it's possible that yesterday was the day to sell them. I'm hanging on to them for now though it may not be the proper strategy. Mentally I'm feeling OK. The VIX was a bit lower today which doesn't fit with a down market. The short term indicators are moving down but look like they're beginning to stall. Not sure what to expect next here but Friday should tell the story. Fundamentally nothing has changed for the stock market. However the technical measurements got so out of whack to the downside that some kind of upwards movement was long overdue. We got that upside the first two days of this week. The question is just how long it will last. It seems like buyers are willing to step in now where before they dissappeared. We'll just have to wait and see where we go from here. Asia higher and Europe lower in last nights trade. We'll keep an eye on tonights headlines.

Upside follow through as the Dow gained 825 points on heavy volume. The advance/declines were better than 6 to 1 positive. The summation index is turning back up here from a deeply negative position. That usually means that the decline is over for now and this rally will have legs. It is also possible that the decline has ended for good but we'll only know that as time moves on. We did meet the measuring objective from the head and shoulders top for the S&P 500 at 3600 on Friday. Sellers have hit the sidelines for now. It looks like we may have missed the best opportunity to put longer term funds to work. But we'll see where we go from here. The short term technical indicators for the S&P have finally turned back up from being oversold. We are also heading back towards the 50 day moving average which is something that we've been looking for. Today we made it past the first down trend line for the S&P. The next one comes in at around 3925 and there is resistance at 3900 as well. That seems to be where we are headed in the short term. Gold was up another $30 on the futures. The US dollar sank and interest rates dropped a bit. The XAU added almost 3 points, while GDX was up around 3/4. Volume was good again to the upside. GDX is getting to be short term overbought and I have to consider selling my October calls here. I do have a higher price target in mind and the options still have over two weeks left in them. So I'm also considering being patient and perhaps getting out at a higher price on the option premium. Always plenty of unknown decisions to be made in the game. Mentally I'm feeling OK. The VIX was lower today but not by much considering the huge move higher we had in stocks. Not sure what that means. The short term technical indicators are mid-range on the VIX. My thinking is that near term the VIX will head down and stocks will continue up. We'll see. Earnings season is about to get under way and all I'm seeing and hearing is that it will be worse than expected. So we'll expect the opposite. Companies will drag down their estimates and then surprisingly beat them in this shell game that comes around each quarter. Europe and Asia were higher overnight. We'll see how things go tomorrow.

Now today we saw a nice oversold short covering bounce as the Dow soared 765 points on good volume. The advance/declines were 5 to 1 positive. The summation index is still moving down. A sharp rally out of the blue is typical for your usual bear market. This rise could have legs though as we have a positive RSI divergence on the SPY daily chart. Not to mention that we've been short term oversold for weeks. And I have mentioned more than once that we are pretty far away from the 50 day moving average on many stock indices. Not sure if this is the bottom though as the NASDAQ didn't lead today. But it's a great start to the month for the bulls. Gold jumped $35 on the futures today and closed above $1700. The US dollar was lower along with interest rates. The XAU was up 5 points, while GDX gained 7/8. Volume was good again to the upside. My GDX October calls are now solidly in the black. GDX is now at its 50 day moving average and that should provide some near term resistance. The short term indicators here are getting oversold but not completely there yet. Plenty of time left in this trade but the key will be when to sell it as the entry was not good. Mentally I'm feeling OK. The VIX dropped and the short term indicators have rolled over. It seems to me that the VIX should go lower and stocks higher from here but who knows? We'll know more as the week goes on. One day doesn't make a rally. Europe was higher and what was open in Asia mixed. Parts of Asia are on holiday this week. We'll see if we get any upside follow through tomorrow.

September ended with a thud as the Dow fell 500 points on end of the month heavy volume. The advance/declines were negative. The summation index is moving down. The inflation data was a little worse than expected but after an initial small sell off the market had a morning rally. That didn't last either as sellers took over. The S&P 500 remains short term oversold and closed below the 3600 support level. The Dow led the way down today. We are long overdue for more than just the bounce that we saw on Wednesday but the market seems to have other plans. We have yet to see any sustained buying or a major bout of short covering. Getting even further away from the 50 day moving average for most of the major stock indices. That will not last forever. Gold was flat again on todays session, this time after being higher early on. The US dollar was little changed and interest rates rose a bit. The XAU gained 1 1/2, while GDX was up 3/8. Volume was good here again. Perhaps today was the day to dump the GDX October calls as GDX closed off of its highs for the day. Some of the very short term indicators got overbought. The GDX October calls that I have are still in the black though and the price and volume lately have been constructive to the bullish side. There's also 3 weeks left in the October option cycle so plenty of time remains. The weekly candlestick chart on GDX now has a bullish engulfing pattern on it. So I'm giving the gold shares the benefit of the doubt for now. Mentally I'm feeling OK. The VIX finished the day a bit lower and that does not fit with a down market. I'm not sure what's going on here with the VIX except that volatility is the rule for now. The S&P 500 closed on its 200 week moving average which should provide some support. However some of the other major stock indexes have already closed below this average on their weekly charts, including the NASDAQ and the Russell 2000. Next weeks price action will be perhaps more important than usual. Plenty of work to do over the weekend to get ready. Europe was up and Asia mixed again to finish out the trading week overseas. It's Friday afternoon and time for a break.

Back to the downside today but a last hour bounce kept things from being worse. The Dow fell 458 points on good volume. The advance/declines were 5 to 1 negative. The summation index is still moving down. The NASDAQ led the way lower. The S&P 500 is holding the 3600 for now and remains short term overbought. Still far away from the 50 day moving average here so I think that 3600 will hold for now. But that's just a guess on my part. We'll get inflation data tomorrow morning and see what happens after that. What we really need to experience is some kind of wash out to the downside event to know for sure that the decline is over. When everybody just throws in the towel on heavy volume. Hasn't happened yet. Gold was flat on the day after being lower early. The US dollar was lower for a second day in a row, while interest rates ticked up. The XAU was up 1 1/8 and GDX added a dime. Volume was good here again. The gold shares are starting to be out performers and we haven't seen that in a while. I'm still holding on to the GDX October calls and they somehow are still showing a small profit. What I've noticed here for the GDX call options is that the premiums are pretty high compared to where the underlying index is. That usually means that the market makers know something and are making you pay up to participate. We'll see how it plays out going forward. Mentally I'm feeling OK. The VIX was higher today but came off of its best levels. Yesterday I thought the VIX was implying higher stock prices. Lately I just can't figure this indicator out. Above the 30 level and still short term overbought. We'll get the Feds preferred inflation gauge tomorrow and that should provide for an interesting market open. My thought is that it could go either way. We also have the end of the month and the quarter on tap. Asia was mixed and Europe lower overnight. We'll close out the trading week tomorrow.

Today we got the inevitable bounce that we were looking for as the Dow soared 548 points on good volume. The advance/declines were better than 6 to 1 positive. The summation index is still moving down. Today we got some relief from the extreme oversold conditions that have stuck around longer than usual. Now we have to ask ourselves if the decline is over. It very well could be as the S&P 500 along with other major indexes managed to hang on at the June lows. However the same negative market fundamentals are in place. The only case for a rally would be technical in nature. The truth is nobody knows where we are going from here. Things could turn back down Friday with the inflation data. However with the both the short and medium term technical indicators for the market extremely oversold, the odds favor at least some kind of stabalization. Even if it's just sideways movement for a while. The S&P 500 is still pretty far away from its 50 day moving average. Gold rallied $33 on the futures. The US dollar finally had a down day and interest rates dropped. The XAU gained 6 1/8, while GDX rose 1 1/2. Volume was heavy to the upside. The gold shares as well were overdue for some kind of bounce after being beaten down for months. The same question can be asked of whether this is the end of their decline or just a one day wonder. The underlying fundamentals for gold haven't changed and they're negative. On the plus side the GDX October calls that I have are now shwoing a small profit. Yesterday I thought that I would just exit on a bounce. Today I'm considering holding them a bit longer. There is plenty of time in the October option cycle for this trade. I did place another order for the gold share calls overnight at a closer to the money strike price but it wasn't filled. At least the ideas are moving in the right direction. Mentally I'm feeling OK. The VIX dropped and implies higher stock prices to come. The short term indicators here have rolled over and have plenty of room to go lower. However I haven't been able to really figure out what's going on with the VIX lately. Todays rally out of nowhere also is classic bear market action. But I do think that we are in for some kind of pause at least for the recent decline. I could be wrong. Asia was lower and Europe slightly higher overnight. We'll keep an eye on tonights headlines.

It was a one day downside reversal for the Dow but that probably doesn't mean much in this extremely oversold market condition. The most watched index fell 125 points on good volume. The advance/declines were slightly negative. Opened higher, closed lower as the malaise continues. The NASDAQ managed a gain though. I still say that a bounce is coming this week as the S&P 500 is pretty far away from its 50 day moving average. I'm not saying the bounce will mean anything but the oversold condition must be relieved at some point. As I have already said we are at extremes for some of our indicators. Some of that pressure has to be worked off and then we will probably head even lower. A big rally out of nowhere is the hallmark of a bear market decline and I am fairly sure we'll get it this week before the end of the month. Gold was up a few bucks on the futures. The US dollar was a bit higher and interest rates were up. The XAU and GDX had fractional gains on light volume. My GDX October calls are solidly in the red. I did place an order for some more at a closer to the money strike price but the order was not filled. I'm still considering purchasing some more calls here but it would have to be before the overall stock market bounce that I'm looking for. I also am hoping to get out of the current GDX trade on that bounce because the entry was ill timed and I would like to either cut the loss or get out even. Could just be wishful thinking. Mentally I'm feeling OK. The VIX was up again today and is just about at 35 which has been close to the top of the range since the decline began in January. The VIX remains short term overbought on its technical indicators and has been for an extended period. That is unusual but we are in unusual times at the moment. Asia was slightly higher and Europe slightly lower overnight. We'll keep an eye on tonights developments.

We remain very oversold as the market is at least trying to halt the decline but the Dow lost 329 points on good volume. The advance/declines were around 5 to 1 negative. The summation index is still moving lower. The McClellan oscillator is now about as negative as it gets but that doesn't mean that we can't go lower. We are at extremes here for oversold market behavior. We will see a pretty good bounce at some point this week in my opinion. The NASDAQ is holding up better than the other major averages so we are probably at some kind of low even if it is just temporary. That said it remains to be seen when we'll see some kind of sustained rally in the near term. We did see an attempt at a bounce into the close again. Perhaps we can build off of that tomorrow. If not it will probably be just more of the same. Maybe the sidelines is the place to be for now. Gold fell again as the futures dropped around $25. Heading for the $1600 level or so it seems. The US dollar is moving straight up and interest rates continued to climb. The XAU lost 2 1/3,while GDX fell a little over 1/2. Volume was good to the downside again. My GDX October calls are solid losers but I am expecting a bounce for the gold shares soon as well. Very oversold here as well. I am considering getting some more of the GDX October calls at a closer to the money strike price tomorrow. What we are witnessing in the markets right now is an oversold extreme. It is the opposite of the overbought extreme that is occurring at this moment in the US dollar. Things that start to go straight up tend to always end with a move straight back down. We have a month to see a drop in the dollar and a rise for gold. That is why I'm considering getting some more of the gold share calls even though I'm currently in a losing position with them. I'll think about it some more tonight. Mentally I'm feeling OK. The VIX was higher, is short term overbought and above the 30 level. Volatility is the watch word. If the VIX gets above the 35 level, that could be about it for the decline in the near term. At the rate we're going we'll get there tomorrow. Summation index moving with big gaps to the downside and through the zero line. The McClellan oscillator approaching the -400 level extreme. Markets oversold and staying that way. These are things that don't happen very often. Opportunities are there if you can take advantage of them but be careful. Asia and Europe were down. We'll see how things go tomorrow.

The selling continues but buyers did appear in the final hour to keep things from getting worse. The Dow fell 486 points on heavy volume. The advance/declines were 7 to 1 negative. The summation index is in freefall. The McClellan oscillator is below -300 which doesn't happen very often. So we are in very interesting times. Short term oversold still for the major averages and staying that way. I'm expecting some kind of bounce that is way overdue but when remains the question. Most of the major stock indexes have made it to their June lows and now we will see if thay hold. The S&P 500 is pretty far from its 50 day moving average and should at least try to get back towards it soon. Things are overdone to the downside but there still are not a lot of reasons to be investing at the moment. However in the longer term the time to be buying is when everyone else is selling. Gold fell about $30 on the futures. The US dollar soared while interest rates were mixed. Rates did come back from their highs of the session, probably in a flight to safety. The XAU fell 5 1/4, while GDX dropped 1 1/4. Volume was heavy to the downside and prices set new yearly lows for the gold share indices. My open order for the GDX October calls got filled and it's already a loser. I'll probably be getting rid of this trade sooner rather than later. However it does have plenty of time left in the October option cycle. Mentally I'm feeling OK. The VIX climbed above 30 today before falling back. Overbought on the short term here but we've seen the VIX get higher in the current down trend that began in January. I'm not sure where the VIX goes from here as I haven't had a good feel for this indicator lately. Overall it was a rough week for stocks. September still has a week to go. We are quite oversold though and a big bounce out of nowhere is entirely possible. However the longer term outlook is not looking positive for stocks despite todays depressed levels. Plenty to ponder over the weekend. As long as the summation index is moving lower that will be the path for the stock market. Europe and Asia were down as it's a worldwide exit from equities. It's Friday afternoon and time for a break.

Attempting to stabalize as the Dow fell 107 points on average volume. The advance/declines were better than 4 to 1 negative. The summation index continues lower. The NASDAQ led the way down and that is not a plus. Short term oversold on all the major stock indices. The market is holding up rather well considering we are crossing the zero line on the summation index. Perhaps things will hold in here and we won't see the collapse that we are in the zone for. We'll know in the coming days. Blown out on the downside to be sure and maybe we'll get a near term bounce. But there are no good reasons to be an investor at the moment and there is more bad news to come as rates continue to climb. Gold rose $5 after being down more early on. The US dollar was higher along with interest rates. The XAU and GDX had fractional moves lower on average volume. Mentally I'm feeling OK. The VIX was lower today which doesn't fit with a down market. Lately the VIX has been leading the market on a short term bais. If that is the case again expect to see higher prices tomorrow. We'll see. On the sidelines with regards to any trades for now. The GDX October call order remains open. Europe and Asia were lower overnight. We'll close out the trading week tomorrow.

Volatility was the name of the game today as the Dow fell 522 points on average volume. The advance/declines were better than 2 to 1 negative. The summation index continues lower. The Fed came and went with the expected rise in interest rates. Stocks then bounced back and forth in a huge trading range before deciding to head lower and staying there. The S&P 500 remains short term oversold. Combine that with the summation index on the doorstep of the zero line and we could be looking at quite a drop in the very near future. Like tomorrow. Some of what we work with is telling us that we could see some strength in the near term as well. However it doesn't look like that means more than just a bounce in the ongoing down trend. Seasonality doesn't favor stocks right now as well. We closed on the low for the day. We'll stick with the summation index direction and look for lower prices going forward. A test of the June lows perhaps? Gold was up ten bucks on the futures in a flight to safety I'm guessing. The US dollar hit a new yearly high while interest rates were mixed. The XAU and GDX had slight fractional moves one way or the other on good volume. It appears that the gold shares can't make up their mind which way to go here. My open order for the GDX calls is still out there. I've decided to not chase anything here and if the gold shares drop perhaps the order will get filled. Mentally I'm feeling OK. The VIX was all over the map today as well. It did finish higher which fits a down market. It broke through the 28 level only to fall back, drop to 25 1/2 and then close at 28. Not sure exactly what to expect next from this indicator. More overbought than oversold on the short term indicators here. We've got the Fed out of the way and we'll have to see what the next catalyst is for stock prices. It appears that we are falling through the zero line on the summation index and that is a rare event. Look out below is the general rule when it happens. Tomorrow could be even more interesting than today. Asia was lower and Europe higher overnight. We'll keep an eye on tonights developments.

Bouncing around today as the Dow fell 313 points on light volume. The advance/declines were better than 4 to 1 negative. The summation index is moving down. We opened with a gap lower and were negative for the whole session. There were a couple of attempted rallies. The NASDAQ did hold up better than the other major averages. The S&P 500 remains short term oversold. Waiting on the market reaction to the Fed but what about after that? The summation index is close to the zero line, so the possibility of the market tanking is possible. There also aren't any compelling reasons to be buying stocks at this juncture. But the market goes where it wants. Option premiums are inflated for the SPY with the recent volatility combined with an extra week in the October cycle. So we will have to wait for the next trade there. Gold was off $4 on the futures. The US dollar was higher along with interest rates. The XAU fell 2 3/4, while GDX lost 2/3. Volume was light. Today the gold shares under performed. My open order for the GDX October calls remains out there. Mentally I'm feeling OK. The VIX rose today as the market dropped. Once again the 28 level contained the rise there. Getting short term overbought for the VIX but not all the way there yet. Not sure what to expect next here with the VIX but if it gets past 28 we'll see a big drop in stocks. The Fed will raise rates tomorrow, Jerome Powell will speak and who knows what the markets will do? My guess is that we'll either see a good short covering rally or another downdraft for stocks. One thing for sure is that it won't be boring. So we'll see. Asia up and Europe down in last nights trade. We'll see what tomorrow brings.

Waiting on the Fed for this post expiration Monday as the Dow gained 197 points on light volume. The advance/declines were positive. The summation index is still moving lower. Short covering is the most likely scenario for todays positive price action. However there is a potential positive divergence on the daily RSI indicator for the S&P 500. That could lead to a longer lasting move higher. But I don't see any huge rally in the works as the market has plenty going against it at the moment. Not the least of which is a restrictive Fed coming out with another rate increase on Wednesday. We are short term oversold on the major stock averages so a bounce here would not be out of the question. The summation index does continue to move down and is approaching the zero line. So the potential to fall apart is upon us as well. Gold was flat on the futures. The US dollar was a bit lower and interest rates a bit higher. The XAU was up 2 2/3, while GDX added 3/8. Volume was about average. The gold shares continue to out perform the metal. This is bullish. I still have my open order for the GDX October calls out there. The short term technicals for GDX are mid-range. My hope is we get some selling after the Fed and the order gets filled. If the gold shares continue higher from here it will just be a missed opportunity. I don't feel like chasing it here but that could change. Things are blown out to the downside for the precious metals complex. But the fundamentals at the moment don't inspire confidence of a sustained move to the upside. Just perhaps an October option cycle trend higher. We'll see. Mentally I'm feeling OK. The VIX was lower today and that fits with stocks gaining ground. This indicator looks like it wants to go lower which would mean more near term gains for stocks. It does remain above both the 50 and 200 day moving averages though. Hard for me to get a read on what the VIX is doing here lately. Not a lot of economic data due out this week. It's all about the Fed. Asia was lower and Europe mixed to begin the trading week. We'll keep an eye on tonights headlines.

Still heading lower as the Dow fell 139 points on expiration heavy volume. The advance/declines were around 3 to 1 negative. The summation index is heading down. It could have been worse as the Dow was off 400 at one point. Perhaps a temporary bottom is now in place or the buying simply could have been expiration related. We'll know more after the price action next week. The NASDAQ still led the way lower but it too came up from the lows of the day. The S&P broke through the 3900 level and closed below it. That is not a plus. The summation index is moving down and approaching the zero line. That means that the market has the chance to simply fall apart in the coming days. I'm not saying it's going to happen but the potential is there. We've got the Fed next week and it should be a waiting game until Wednesday. Perhaps we'll get some short covering ahead of the meeting because there's really no reason to be a buyer at this point. Gold bounced back six bucks. The US dollar was slightly lower and so were interest rates. The XAU and GDX had fractional gains on good volume. The gold shares did come up off of the lows for the session. My open order for the GDX October calls wasn't filled and I'm considering changing it to get the long position. The gold shares continue to act well relatively here and I do think that the October call options are the way to go. I'll reconsider this idea over the weekend. Mentally I'm feeling somewhat remorse for not holding on to the SPY September puts longer. I did not have the patience or the nerve to hang on until today which turned out to be the proper strategy. I had considered it on Tuesday after the big drop but could not bring myself to do it. Trading and regrets sometimes go hand in hand. More importantly though is the ability to forget the last trade and keep moving forward. Not easy but it is part of the game. The VIX was barely higher and capped again at the 28 level. The short term indicators here are trying to roll over which would imply higher stock prices for the near term. I'm not exactly sure that is going to happen. I haven't had a good handle on the VIX lately. Plenty of work to do over the weekend to get ready for next week. An extra week in the October option cycle doesn't make things any easier. Asia and Europe were both lower to finish the trading week. It's Friday afternoon and time for a break.

Continuing to the downside as the Dow fell 173 points on good volume. The advance/declines were better than 2 to 1 negative. The summation index is now starting to move down. The NASDAQ led the way lower. The economic data out today was mixed. It appears that the battle for 3900 on the S&P 500 is on. We did dip below there in the final hour today but made it back above by the close. Getting short term oversold on the S&P but not all the way there yet. I don't think that 3900 will hold but we'll see. Option expiration tomorrow so anything can happen. If the summation index does continue lower towards the zero line we may test the June lows. Hasn't happened yet and there is no impending doom but it's possible given where we are. The market hasn't been able to sustain a rally since the inflation report this past Tuesday. Gold fell $36 on the futures and is solidly below the $1700 level. The US dollar was steady but interest rates continued their climb. The XAU dropped 3 points and GDX shed 3/4. Volume was good to the downside. Despite the drop the gold shares continue to do better on a relative basis than the price of gold. My open order for the GDX October calls is still out there. The prices of the GDX call options for October are holding up better than you would think given the decline in the gold shares. That tells us something. I still like this idea and the order will possibly get filled if the S&P 500 breaks 3900 and takes the gold shares with it. Mentally I'm feeling OK. The VIX was slightly higher today. I'm still not getting a good read from the short term indicators here. Expiration Friday should be interesting. Asia was mixed and Europe lower in last nights trade. We'll close out the weeks trading tomorrow.

A day of stabalization as the Dow rose 30 points on good volume. The advance/declines were slightly positive. The summation index is beginning to move sideways. It was back and forth for much of the session but no big moves either way. The NASDAQ was the leader today but we don't know if the decline is all of a sudden done. It is option expiration week so there are plenty of things in play. The fact that we didn't follow through lower today is a plus for the bulls. The short term indicators for the S&P 500 are not overbought or oversold. With only 2 days left in the September option cycle the risk was too much for me to hold on to the SPY puts and I sold them today. The exit was poor as the market rallied in the final half hour and I simply got out. Had I been more nimble I would have had better results. The profit was 400% in two days but it should have been better. I also didn't have the guts to hang on until Friday but we'll see where we go from here. Gold was off a dozen on the futures. The US dollar was lower and interest rates ticked up. The XAU and GDX had slight fractional moves one way or the other on lighter volume. The gold shares continue to hold up rather well despite gold itself. My open order for the calls remains out there. Mentally I'm feeling a bit frustrated as I did not exit the SPY trade in good fashion. I did have a chance for better profits but wanted to see how the close went. Unfortunately it went against me. However you've got to keep moving in the game and that trade has been completed so we'll have to move on. October has an extra week in the option cycle so premiums will be higher than usual. The VIX dropped as the 28 level has proven to be a ceiling here lately. The short term indicators here are mixed and I'm not getting a good feel for what's about to happen with the VIX next. Plenty of economic data out tomorrow led by the retail sales numbers. Europe and Asia were lower overnight. We'll see what tomorrow brings.

Sometimes the market doesn't act rational. Today was one of those times. The Dow got clobbered when the inflation report came in hotter than expected. The most watched index fell 1276 points on average volume. The advance/declines were 8 to 1 negative. The summation index has turned back lower. Not sure if the summation index will track sideways or start heading down to the zero line. The NASDAQ led the way lower and lost over 5%. Major markets opened with a gap lower and traveled down for much of the session. The S&P 500 is close to the support at 3900. What happens there will tell the story as 3900 is the line in the sand for the bulls. It is expiration week so anything can and will happen. My SPY September puts are in the black. Now the question is when to sell them. I suppose we'll keep an eye on the 3900 level and take it from there. The stop loss order has been modified to lock in a profit if the market turns back up here. Gold was off over $25 on the futures. The US dollar resumed its climb higher as did interest rates. The XAU fell 4 1/4, while GDX lost a point. Volume was good to the downside. The short term indicators have moved lower for GDX. However the gold shares, despite todays losses, held up rather well. My open order for the GDX October calls remains in place. Mentally I'm feeling OK. The VIX jumped and is back above its 200 day moving average. The short term indicators here are mixed. We closed at the recent highs for the VIX at 27 and change. Yes, it could go higher but whether or not it does is the question. Only 3 days left in the September option cycle. We'll get producer inflation data tomorrow and I don't think it will be viewed like the consumer numbers today. I could be wrong. Retail sales and other data due Thursday. The market will have plenty of excuses to go one way or the other. However after todays debacle it will be hard to see a quick turnaround for stocks. But anythings possible in this game. Asia was up and Europe down in last nights trade. We'll keep an eye on the overnight developments.

A positive start to expiration week as the Dow gained 189 points on light volume. The advance/declines were 3 to 1 positive. The summation index is turning back up. Once again the NASDAQ led the way up and that's a plus. The S&P 500 broke through the near term down trend line. The short term indicators here are moving higher with room to go. It looks like there is no way to go but higher from here. That said, I did purchase the SPY September puts today ahead of tomorrows inflation report. My entry could have been a little better but it wasn't bad. The closing price is right about where I got them this morning. This trade will hinge on the reaction to tomorrows data. We do not trust light volume rallies and that is what we've witnessed here. Gold was up $7 on the futures. The US dollar was lower and interest rates were steady. The XAU was up 1 1/2, while GDX gained 1/3. Volume was about average. The gold shares have been acting much better lately. They are approaching short term overbought but aren't there yet. Any pullback would be a chance to get the GDX October calls in my opinion. My open order for them is still out there. Mentally I'm feeling OK. The VIX was up today and that does not fit with a positive stock market. Not sure what it means but it did close back above the 50 day moving average. It could make for an interesting session tomorrow. The consensus is for a benign print on the consumer inflation data. We cannot predict the numbers but it's safe to say they'll have an effect one way or the other. Sticking with the technicals is always the way to go in our opinion. Our view is that we got the light volume rally off of the recent lows that we were looking for and an attempt at a short term trade now involving the SPY September puts is worth the risk here. We'll find out tomorrow if it was the proper idea. Much of Asia was on holiday but open markets were higher. Europe was up as well. We'll see what tomorrow brings.

More upside today as the Dow gained 377 points on light volume. The advance/declines were 5 to 1 positive. The summation index is starting to try and turn around. Once again the NASDAQ was the leader. I did place an order for the SPY September puts but it wasn't filled. I'll probably try again on Monday because we are seeing a light volume rally going up to the near term down trend line in the S&P. It is possible that I'm too late though. It all depends on the price action Monday. The short term technical indicators for the S&P along with the other major averages have turned back up. So we also have the possibility that a bottom is in place and that the rally for the past three days will continue. But you have to pick your side and for now I'm going with a bearish scenario at the trend line. Inflation data on Tuesday will provide some answers when we get the market reaction to it. We'll have all weekend to decide what to do. Gold rose $6 on the futures. The US dollar was lower and interest rates were steady. The XAU was up almost three points and GDX gained 3/4. Volume was about average. The gold shares are out performing the metal itself and this week is the first time we've seen that for a while. It's a positive. Any pullback in the gold shares can be bought in my opinion. But once again we may already be too late if the gold indices simply continue to move higher. My order for the GDX October calls remains out there. Mentally I'm feeling OK. The VIX continued down and there's still some room on the short term indicators to go lower. It fits with the higher stock prices that we're seeing. Perhaps we should just pay attetion to what's happening here but we'll know more on Monday. We can make a case for the S&P to get to 4100 before a pause but that would put it through the down trend line. It did close above its 50 day moving average today. There is also now a bullish engufling pattern on the weekly candlestick chart. So being bullish here has its backers too. Plenty to ponder over the weekend. Europe and Asia were both higher to close out the week as there seems to be a better tone for stocks at the moment. It's Friday afternoon and time for a break.

Continuing higher today as the Dow gained 193 points on light volume. The advance/declines were positive. The summation index is still moving down. We bounced around today but managed to finish near the highs for the session. For now it is fitting in with our scenario of a light volume rise to the near term down trend line in order to try the SPY September puts. But that doesn't mean that it's going to happen as a bottom is in place and it could lead to a longer rally. The short term technicals for the S&P 500 have turned up and have plenty of room to move higher. The potential inverted head and shoulders pattern is still there on the S&P and the NYA. So we have a lot to think about in the coming days. Do we want to be short going into the weekend if we see more upside tomorrow? Do we wait until before the inflation report that is due out on Tuesday? Or do we simply step aside and let the market go where it goes? Always plenty of questions in this game. Gold dropped $9 on the futures. The US dollar was steady and interest rates ticked higher. The XAU rose 1 3/8, while GDX was flat. Volume was average. The gold shares held up better than the metal itself and we haven't seen that in a while. I'm still a fan of the GDX October calls and my open order remains in place. Mentally I'm feeling OK. The VIX continues to fall and it closed below its 50 day moving average. There's also plenty of room on the short term indicators here for the VIX to move lower. That implies higher prices near term for stocks. That fits with our hopes of a rise to the down trend line on the S&P. The problem is that it could mean a much better rally and a break to the upside of that line. We will have to make a decision rather soon, as in the next couple of trading sessions. We're also running out of time for this option cycle so the risk is high. The option premiums will be moving quickly and it has already been established that the short term trades are not my best. However at this point I'm still inclined to try the SPY put trade if we move higher towards that down trend line. Asia was mixed and Europe generally higher overnight. We'll close out the shortened week tomorrow.

Looking for a bounce and we got one today as the Dow climbed 436 points on light volume. The advance/declines were better than 3 to 1 positive. The summation index is still moving down. The NASDAQ led the way higher and that's a plus for the bulls. The question now is whether or not the bottom for this move lower is in or if this is just a bear market bounce. It feels like the latter since the up move came out of nowhere, which is often the case in bear markets. We still remain short term oversold for the S&P 500 despite the move higher today. The light volume also doesn't inspire us to believe that this is more than just a bounce in an ongoing down trend. The next down trend line for the S&P 500 comes in about 100 points from here. Will we get there or have the patience to wait? The trading is never easy and time is running out in the September option cycle. Gold jumped $15 on the futures. The US dollar was lower along with interest rates. The XAU added about 3 2/3, while GDX was up 7/8. Volume was good and the short term technical indicators for GDX have turned back up. My open order for the GDX October calls wasn't filled and it appears that it won't be. I'm still leaving it out there but it doesn't look like it will get filled if this is indeed a bottom for the gold shares. Mentally I'm feeling OK. The VIX dropped and closed back below its 200 day moving average. The short term indicators here are rolling over which implies more gains to come for stocks. It is another sign that the potential is there for the recent decline to be over. However we'll only know that for sure as time goes on. Meanwhile we have to trade with whatever information that we have today. If we continue to move up with light volume I will probably try the SPY puts before expiration next week. I'm also a believer in the gold shares right now so I'll be hoping for some near term weakness again there to try the October calls. Markets rarely cooperate. Asia was lower and Europe higher with the exception of the FTSE overnight. We'll see how things go tomorrow.

Slightly lower to begin a shortened trading week as the Dow fell 173 points on average volume. The advance/declines were better than 2 to 1 negative. The summation index continues lower. Once again the NASDAQ led the way down but it wasn't a huge decline. Short term oversold and staying that way for the major averages. I'm still looking for some kind of decent bounce in stocks this week. Hopefully that would set us up for the SPY September puts. But the market rarely cooperates with the best laid plans. Plenty of bears out there now so a move in the other direction would not be a surprise. Running out of time in the September option cycle. Gold dropped $11 on the futures. The US dollar was higher along with interest rates. The XAU fell a point and GDX lost 1/3. Volume was average. My open order for the GDX October calls remains out there. We'll need to see more of a decline in the gold shares for this order to be filled. Not sure it's the best idea but the gold shares are blown out to the downside on all the time frames. The indicators also remain oversold as they have been for a while. Mentally I'm feeling OK. The VIX was higher today and that fits with a down market. Short term overbought here and staying that way. That condition won't last forever but we certainly don't know when it will end. It lends to the possibility of more downside for stocks if it persists. A positive is that the S&P 500 has held the 3900 level so far. We remain at a critical juncture. Europe was up and Asia mixed in the overnight trade. We'll keep an eye on tonights headlines.

A one day reversal back to the downside today as the Dow opened higher and closed lower. The most watched index fell 338 points on light volume. The advance/declines were negative. The summation index is moving down. The market liked the jobs report as we were higher early on. Then about halfway through the session the sellers took over and moved things lower until we reached the support at 3900 where we got a slight bounce into the close. The NASDAQ was the downside leader again. We are short term oversold and I expect to see a better bounce than what we just got. If 3900 can't hold things together for the S&P 500 we'll probably have to head down and test the June lows. However I do expect things to hold up here at least on a temporary basis. The breadth wasn't too bad today despite the drop. Plus the light volume ahead of a long holiday weekend wasn't a surprise. When everybody gets back to their desks next week we'll see where we're going. Gold saw a bounce today as the futures rose $11. The US dollar was a bit lower and interest rates dropped. The XAU rose 3 1/3, while GDX added 3/4. Volume was good to the upside so perhaps the decline in the gold shares will come to an end. Still short term oversold here despite todays gains. I'm leaving in my order for the GDX October calls. May have missed the chance though if the gold shares simply move up from here. Mentally I'm feeling OK. The VIX had a wide range today and finished just a bit lower from yesterdays close. I still can't figure out where the VIX is going here but it remains short term overbought. What we can say for certain is that volatility has returned. Only nine days left in the September option cycle. We now have a down trend line for the S&P that comes in at 4100. If we can somehow make it up close to there before expiration we'll try the SPY September puts. But that seems like a remote possibility as the S&P is below its 50 day moving average now and moving lower. We'll go over the charts as usual this weekend with an extra day to try and develop a strategy. Europe higher and Asia lower to finish the week. It's Friday afternoon and time for a rest.

We had a one day reversal to the upside as stocks opened lower and closed higher. The Dow gained 146 points on average volume. The advance/declines were better than 2 to 1 negative. The summation index is moving down. Finally at least some kind of bounce in the market that was long overdue. Possibly just some short covering but the indicators were extended to the oversold side and some kind of relief was necessary. Perhaps we'll see some follow through after the jobs report on Friday. But the fundamental backdrop of higher rates for a longer time remains. The 3900 support level for the S&P 500 has held up for now. As long as the summation index is heading lower, the overall trend remains down. Gold dropped twenty bucks on the futures. Getting close to the $1700 level here. The US dollar was higher along with interest rates. The XAU lost 3 1/3, while GDX sank another 3/4. Volume was good to the downside again. The gold shares are blown out to the downside any way you look at it. I have placed an order for the GDX October calls and I'm leaving it out there. It will take some more decline in GDX to get filled. The October option cycle has an extra week in it. Mentally I'm feeling a bit tired. The VIX was lower today and remains short term overbought. On the daily chart it looks as though the VIX has put in a short term top. This would imply that we will see some near term strength in the stock market. Perhaps that will set us up for the SPY puts before the September expiration. However the potential S&P 500 inverse head and shoulders pattern remains intact. For now we'll wait and see what the reaction is to the employment report. Europe and Asia were both lower overnight. We'll close out the trading week tomorrow.