Monday, April 16, 2012
A mixed day in the markets as the Dow gained 71 points on light volume. The advance/declines were positive. The overall market was much weaker than the Dow and that usually isn't bullish going forward. The technicals are still more oversold than overbought. Summation index heading lower. It's option expiration week. GE was flat on the day and the volume was very light. Could be in a holding pattern until the earnings report on Friday. That's a guess. No trades here for me at the moment. Gold fell $10 on the futures with the US dollar lower as well. Not exactly sure what that means. The XAU dropped 2 1/3. ABX off 3/4, GG fell about 1/4 and NEM down by 1/2. I tried to add to my ABX May call trade but my order was only partially filled. The ABX calls are in the red but I still think this trade is the way to go. I'm not sure if I'll try and complete the rest of todays partial fill tomorrow. We'll see. Mentally I'm feeling OK. I get the feeling the stock indexes could go either way here. I think that I would still wait for a positive divergence on the McClellan oscillator before trying the OEX calls. However there are only 4 days left for the April option cycle. The Gold/XAU ratio is at the point where the risk/reward for trying the gold share calls clearly favors an attempt. That's one of the reasons I'm giving them a shot. Plenty of time for the trade to work is another advantage in trying them here and now. We'll see what happens.
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