The Dow took off to the upside today as it gained 558 points on heavy volume. The advance/declines were around 3 to 1 positive. The summation index is in a sideways channel. The inflation data came in higher than expected but after an early sell off buyers stepped in. The NASDAQ was pretty negative for much of the day but came all the way back for a slight gain. The S&P 500 posted a small gain. On a day where the economic numbers suggested a sell off, it didn't happen. This is what I mean when I say the market goes where it wants. You would expect interest rates and the US dollar to rise on the data but they did not. These were a couple of the products that I mentioned last week that their indicators got stretched too far in one direction and were bound to reverse at some point soon. We've reached that point. Things will probably support another rise for stocks going forward. The short term indicators for the S&P have now stalled after dropping yesterday. The daily candlestick chart here looks bullish and the S&P held its near term up trend line. Gold took off higher as well and the futures gained $89. The US dollar was lower along with interest rates. The XAU climbed 13 points and GDX added 3 2/3. Volume was above average and GDX closed at its high for the session. My open order for the GDX November calls didn't get filled but I'm leaving it out there. Looks like we may have missed this trade again but we'll see what happens going forward. But some of the short term indicators for GDX have jumped higher so it looks like it could be the beginning of something sustained to the upside. Mentally I'm feeling OK. The VIX was lower today and some of its short term indicators have turned back down. The 200 day moving average here contained the recent rise. The daily candlestick chart looks like it wants to go lower. Expiration Friday on tap and anything goes at this point. The Fed chairman will be speaking at an IMF summit tomorrow so that may provide a reason for markets to move. Asia was lower with the exception of India and Europe continues to trend upwards. We'll close out the trading week tomorrow.

Lower from the start today but the Dow only lost 48 points on heavy volume. The advance/declines were 3 to 1 negative. The summation index is moving sideways. The inflation data came in a bit hotter than expected and most averages had a gap lower on the open. Both the NASDAQ and S&P 500 got clobbered. The NASDAQ was down over 500 points and the S&P lost over 1%. Stocks made a slight comeback in the final hour. The short term indicators on the S&P have turned down with room to go. More economic data due tomorrow including producer prices on inflation. I would expect some follow through selling but you never know. Gold took a hit as well with the futures off $53. The US dollar was higher and interest rates were flat to a bit lower. The XAU lost 16 1/2, while GDX shed around 3 3/4. Volume was good to the downside. The gold shares did come up off of their lows. The short term indicators for GDX are heading down and are getting to completely oversold. I adjusted my order for the GDX November calls to a closer in the money strike price. Still not filled yet and may have to adjust it again tomorrow. I'm feeling pretty sure that getting the calls here is the right idea despite my recent loss attempting this. We'll see. Mentally I'm feeling OK. The VIX was up today as you would expect. The short term indicators here have shot higher and some are almost already overbought. Perhaps the VIX is implying that the decline will not last too long. Time will tell. Asia lower and Europe slightly higher overnight. I'll keep an eye on tonights headlines.

Hanging around today but the Dow fell 180 points on light volume. The advance/declines were positive. The summation index is still trying to turn higher. We got a signal last night from the McClellan oscillator for a big move within the next two trading sessions. We'll see if that happens tomorrow. Probably will with whatever reaction we get to the inflation numbers. The NASDAQ posted a small loss today and the S&P 500 finished basically unchanged. The short term indicators for the S&P remain overbought. The concensus for the inflation data tomorrow is already pretty high so anything below that will most likely be viewed as a positive. But we have no idea where those numbers will be. No SPY option trades here with only three days left in the October cycle. Gold was off a couple bucks on the futures today. The US dollar was lower along with interest rates. The XAU fell 6 1/4 and GDX dropped 1 1/4. Volume was light. Some of the short term indicators on GDX have turned back lower. I did place an open order for the GDX November calls in case we see a sell off tomorrow. Not back to short term oversold on the daily chart here yet but the order won't get filled unless we see additional selling. Mentally I'm feeling OK. The VIX finished little changed on the session. Some of its short term indicators have turned lower. Still not sure what to expect next on the VIX. Although I will say that tomorrow could be an interesting day in the marketplace. Asia was a bit higher with the exception of Japan and Europe was barely lower. We'll see what tomorrow brings.

Mixed to start options expiration week on a partial Monday holiday as the Dow gained 195 on pretty light volume. The advance/declines were slightly negative. The summation index is trying to turn higher. The NASDAQ dropped the most today and the S&P 500 posted a small loss. The short term indicators for the S&P remain overbought. Earnings season gets started this week and the consensus is predicting good numbers. CPI on Wednesday and PPI on Thursday could take center stage. The S&P is already overbought so I'd advise some caution here ahead of those reports. No SPY option trades for now. Gold dipped $23 on the futures. The US dollar was higher and the bond market was closed. The XAU was off 2 3/8, while GDX shed 3/4. Volume was very light. Some of the short term indicators for GDX are beginning to stall. I still like the idea for the GDX November calls but would prefer to see GDX get back to short term oversold. May not happen. Mentally I'm feeling OK. The VIX was higher today and some of its short term indicators are turning back up. Hard for me to say where it goes from here. Asia was mixed and Europe higher to begin the week. We'll see how it goes tomorrow when all the players are back in the game.

Buyers took control today as the Dow climbed 423 points on light volume. The advance/declines were positive. The summation index is trying to turn back up. It eventually will as it is blown out to the downside and probably sooner rather than later. The Dow led things higher today which isn't the most bullish scenario. The S&P 500 had a decent gain. Its short term indicators are still overbought. It looks poised to go higher but the volume to upside today was lacking. Moving into options expiration week so perhaps the usual positive bias will be in effect. Gold rallied $63 on the futures today. Both the US dollar and interest rates nudged higher. The XAU gained 9 points and GDX was up 2 1/2. Volume was light. Gold and the gold shares higher with no apparent news to drive them and we'll take notice. The short term indicators for GDX are now moving higher with plenty of room to go. The short term down trend line on GDX comes in at 92. If it gets through there the rally will be on. I believe that it has already started but am hoping for some kind of move lower in the next couple of days to fill todays gap on the daily chart. Markets rarely cooperate. Perhaps the inflation data next week will give us the opportunity to purchase the GDX November calls. The weekly GDX candlestick chart has a potential loosely formed inverse head and shoulders pattern appearing in the past seven months. If that comes to fruition the gains for the gold shares would be very good. We'll see. Mentally I'm feeling tired. The VIX was lower today and that coincides with an upside market. The short term indicators here are pointing south. It looks like the VIX wants to go lower. A back and forth week for stocks but it really looks like things are about to get going to the upside. The medium term indicators have been oversold for too long. Perhaps earnings season will have the buyers out in force again. Inflation data out next week should move the markets. I probably will not try the SPY options as I don't see a solid signal there at the moment. I am looking to try the gold share calls again. I'll check the charts over the next two days to make sure that I have some type of game plan for next week. It already looks like the inflation numbers are supposed to be high. That means if they go up but not as much as expected, traders will view that as a positive. Just a guess there on my part. We'll stick with the technicals. Asia and Europe finished up on the last day of the week. It's Friday afternoon and time for a break.

A mixed bag today with the Dow up and the overall market lower. The most watched index rose 51 points on heavy volume. The advance/declines were positive. The summation index is trying to stabalize. The NASDAQ led the way lower, off 1 1/4%. The S&P 500 was down 36 points but did come back from the lows on the session. The short term indicators here have now turned down with plenty of room to go lower. The market is trying to figure out what it wants to do. No SPY options trades in mind right now. Gold found a bid with China returning to the market after a holiday as the futures rose $15. The US dollar and interest rates were slightly lower. The XAU climbed 5 points, while GDX added 1 1/3. Volume was light. The short term indicators for GDX have turned up but remain oversold. I'm still considering the GDX November calls but will most likely wait for next weeks inflation data to get out of the way before purchase. Mentally I'm feeling a bit tired. The VIX was higher today and that fits with an overall down market. The short term indicators here are trending higher but without conviction for now. I'm not exactly sure what the market wants to do here as we still have conflicting short and longer term signals. Never an easy game plus my take on things hasn't been solid lately. We keep moving on though. I'll probably let Friday go by and regroup over the weekend. Asia and Europe were down again in last nights trade. We'll close out the week tomorrow.

Selling today as the Dow fell 341 points on good volume. The advance/declines were almost 4 to 1 negative. The summation index is back to moving down. It could have been worse but most indices finished well up from their morning lows after a gap lower on the open. The Dow led things down and that isn't the most bearish scenario. Most of the short term indicators for the S&P 500 remain overbought. I'm not sure what's coming next here for stocks. There was no follow through to the new all time high in the S&P. Other indicators that we look at are mixed. Some of the longer term ones are in areas that usually precede market strength. Some shorter term ones are showing signs of a near term top. I'm on the sidelines with regards to the SPY options for now. Gold got spanked as the futures dropped $58. The US dollar was higher and interest rates finished little changed. The XAU fell 11 1/4, while GDX lost 2 3/4. Volume was about average. The short term indicators for GDX have turned back down in oversold territory. GDX has now broken below the area of consolidation that appeared to be forming a bottom to me. Needless to say my GDX October calls lost even more ground and I dumped them for an 85% loss. The stop loss order that I had in that didn't get filled earlier this week was set for a 50% loss. So I tacked on another 35% by being stubborn in this trade. My mistake was not just getting out when the stop loss wasn't filled. The 50% losses are part of the game. The only saving grace is that there wasn't much money put into this idea, as it failed the last time that I tried it as well. Will I try this trade again? Probably. Some of the medium term technical indicators that we watch have been stretched to extremes for the US dollar and US interest rates. Meaning that these two products cannot continue to rise forever. There has to be some kind of consolidation or move in the opposite direction to relieve the out of whack condition. A drop in the dollar and yields would normally be supportive for gold. When that occurs, combined with the oversold condition for GDX, it should lead to some kind of positive price action on the gold shares. Perhaps moving out to the GDX November calls will be the next attempt. Mentally I'm feeling a bit perplexed as the GDX losing trade does not help with the trading confidence factor. However it must be put in the rear view mirror because the market doesn't care. The VIX was just up slightly today. The short term indicators are now tracking sideways. The daily candlestick chart here still looks like it wants to go lower. Europe and Asia were down overnight. I'll keep an eye on tonights headlines.