Wednesday, May 22, 2013
Plenty of Fed speak and we got some volatility. The Dow fell 80 points on heavy volume. The advance/declines were about 4 to 1 negative. It was a one day reversal to the downside as we opened much higher on the stock indices. Could this be the start of some kind of pullback? That remains to be seen. If you want buy a dip, we got one today. The Fed might start to ease up on the easy money that has helped fuel the rally and that had the players spooked today. We'll see if we get any follow through to the downside tomorrow. Todays action should turn the summation index lower. One day doesn't make a trend though. GE was up 1/4 on heavy volume. We made a new yearly high today for GE. We did take out the $23.75 level but finished well off of the highs for the day. The fact that GE made a new high today says that a decline in the overall market is not imminent. We'll see. Gold had a one day reversal to the downside as well, as the futures dropped $10. Gold was up over $1400 early on. The US dollar was stronger on the Fed. The XAU gained a point but was well off the highs for the day. ABX, GG and NEM all had fractional gains on heavy volume. The gold shares held up pretty well today despite the negative tone. That could bode well going forward. I'm still waiting to see how the month of May ends up for ABX. That will determine how long I stay in that trade. My October ABX calls are still slightly in the black. Mentally I'm feeling OK. So we got the Fed out of the way and we will have to see how things pan out from here. 2 trading days left before a long holiday weekend. I don't expect any huge decline to take place here. The market was falling today but came back in the last half hour. Perhaps this stalls the upside momentum for a couple of days. Or maybe the long awaited correction is about to begin. It's really all a guess right now. Gold did not have a positive session but it could have been worse. As long as we stay above the crash lows the potential double bottom in gold remains. We'll see how the overseas markets react to todays US price action.
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