Wednesday, May 08, 2013
It is a momentum move to the upside as the Dow gained 49 points on average volume. The advance/declines were 2 to 1 positive. It seems like there is no stopping the stock markets now but we know that attitude can be dangerous. The summation index continues to climb higher. All the stock indices are in sync to the upside. Overbought, staying there and this condition remains. Enjoy the ride. GE was up 1/3 on average volume. Right at the 50 day moving average now. I still have no trading ideas regarding GE for now. Gold moved back to the upside today as the US dollar fell. The precious metal futures rose $25. The XAU finally went up with the price of gold as that index gained 5 1/3. ABX up 1 2/3, GG higher by 1 3/4 and NEM tacked on 1 1/2. Volume continues to be extremely heavy in ABX, just average for the other two. The October ABX calls I own are solidly in the black after todays action. But we all know how that can change. However the medium term technicals for the gold shares remain oversold so we could have more room to run up here. That's a guess as usual. Mentally I'm feeling OK. It has been quite a rally for stocks since November and there seems to be no end in sight. Buying the dips remains the theme. I am certainly surprised by the length and strength of this rally. Gold has had a very nice recovery from the crash of 3 to 4 weeks ago. This leads me to believe that was a washout event and we have seen the lows for gold this year. Gold has also held at the 200 day moving average on the medium term charts. I still think the low will be tested at some point but it will hold in my opinion. Any retest would be a chance to go long again. That's my guess at the moment. We'll see what happens on Thursday.
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