Monday, March 11, 2013
The beat goes on as the Dow gained 50 points on light volume. The advance/declines were positive. Grinding higher. The summation index is moving upward. We are about as overbought as you can get but that doesn't mean the stock indices won't go a bit higher. There is still a three point negative RSI divergence on the daily S&P 500 chart. It also appears to me that we are in the 5th wave of a 5 wave move up that began last November. What I am saying is that this rally is on its last legs and when we start to move lower it will last a while. Perhaps we can set a new all time high in the S&P 500 but I think that's about it. I could be wrong but the technicals say otherwise to me. GE fell 1/8 on average volume. Not much to say here. A negative RSI divergence here as well. No trades there for now. Gold was pretty much flat on the futures today as the US dollar fell just a bit. The XAU was off 1/3. ABX and NEM finished the day barely unchanged, while GG dipped 1/4. Volume was light. My April ABX calls are still solidly in the red. We are at the point on the weekly RSI indicator for the ABX chart where previous moves higher have begun. Whether or not that happens this time remains to be seen. I'll hold onto the calls for now. Mentally I'm feeling OK. I would certainly like to try the OEX puts again sometime this week but the risk is pretty high. The timing would have to be spot on. After the last losing trade though, I'm more inclined to sit it out and keep an eye on the ABX trade. But we'll see. If we are still higher again tomorrow and the volume is light, I may have to try the March OEX puts again. Gold is going nowhere at the moment. Ditto the gold shares. This ABX trade doesn't look like the smartest thing in the world at the moment either. The usual upside expiration week bias is intact for now. We'll keep an eye on the overseas markets overnight and take it from there.
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