Wednesday, May 29, 2013
Back to the downside today as the Dow fell 106 points on average volume. The advance/declines were 4 to 1 lower. The summation index continues lower and we should probably take our cues from that. We've stopped going straight up for now but whether that means a decent decline is in the works is the question. Perhaps we are in the beginning of some type of distribution top but that's a guess as usual. The momentum to the upside will need to reappear rather quickly to be relevant again. Still short term oversold on the stock indices here and waiting for some type of upside action. Maybe tomorrow. GE was up a bit on lighter volume. Basically sideways since we saw new highs. No trades in mind here. Gold bounced back, up $12 on the futures. The US dollar reversed and gave back all the gains from yesterday. The XAU showed some life, gaining 4 points. ABX, GG and NEM were all up around a point or so. I'd like to see some kind of upside for gold going into the end of the month. 2 days left, so we'll see what happens. Mentally I'm feeling OK. The GDP revision is due tomorrow and that should provide some market direction early. I'm expecting some type of upside regardless, due to the oversold market condition. If we continue to decline then I would say that the game has changed. Gold is still holding above the crash lows for now. A rally from here would certainly help my October ABX calls. An end of the week close for gold above $1400 would be a step in the right direction I believe. We'll see what tomorrow brings.
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