Monday, September 30, 2013
The decline continues as the Dow fell 128 points on average volume. The advance/declines were negative. Remaining short term oversold on the major stock indices. It appears that a US government shutdown will not be avoided. However the stock market is not in a crash mode. A deal will be struck sooner or later and a rally will ensue. The question could be whether or not to short that rally. I suppose I should have held on to the October OEX puts that I had last week. But my trading hasn't been good this year and that is simply another example. I'd expect some type of upside here soon for the stock market. GE was off 1/8 on average volume. Trying to hold the 50 day moving average here. Gold did not see a flight to safety and the futures here fell $12. The US dollar was a bit weaker as well. If a government shutdown isn't a positive catalyst for gold, I don't know what will be. The XAU was lower by 1/3. ABX, GG and NEM all had slight fractional gains on light volume. My October ABX calls remain solid losers with less than 3 weeks to go. I'm still considering the ABX November calls moving forward. Waiting for what I consider a buy signal. Mentally I'm feeling OK. The small stocks are still holding up rather well and that is one of the reasons that I don't expect a full on market rout here. Also the advance/declines today did not reflect as much weakness as price. The summation index could start to head sideways here. Plenty of uncertainty for the stock market at the moment. However this will all get resolved. Gold is not doing much despite the looming US shutdown. This isn't bullish for the precious metal. The gold shares remain in limbo as well. We'll keep an eye on overnight developments and take it from there.
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