Friday, February 24, 2012
It seemed like a day of just marking time as the Dow finished lower by a point and two thirds. The advance/declines were about even and the volume was pretty light. The overall market was stronger than the Dow. We're still overbought both short and medium term on the stock indices. We're still grinding higher as well. GE was little changed once again on very light volume. I'm not exactly sure about a March option trade here now. We've had every opportunity to break out higher here and it hasn't happened. Perhaps if we drift back to the 50 day moving average on the daily charts, I'll try the calls. Gold was lower today, down around $10 on the futures. The US dollar was lower today as well so the non confirmation with the price of gold is troubling for the longs. And I'm one of the longs. The XAU fell 2 1/4 today. ABX was off 3/4, GG down 7/8 and NEM fell 1 1/4. Volume was light to average. My ABX calls are right back at where I purchased them. I expected some hesitation at the $50 level for ABX but I don't like the way the stock and gold acted today. The daily candlestick chart looks ominous as well unless we turn things around in a hurry at the beginning of next week. I'm not giving up on this trade just yet because this could just be a pause before we move higher. But if it isn't, this trade will be another loser. Mentally I'm feeling OK, slept well enough. It seems like we're still waiting for some type of market correction that never comes. It has been quite a long time since we've seen even a drop of 3 or 4 days. The trend remains up until further notice. Gold had a good week but we'll need to see some follow through next week to bolster the bullish cause. I'll be checking the charts over the weekend to come up with some type of game plan for next week. For now it's Friday afternoon and time for a break.
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