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Friday, September 20, 2013

To the downside for expiration Friday as the Dow fell 185 points on heavy volume.  The advance/declines were about 3 to 1 negative.  Not exactly sure what to make of todays price action.  There was some Dow re balancing going on along with the quarterly expiration.  We'll see what happens Monday.  The summation index continues to the upside.  The stock indices will have to deal with the threat of a US government shutdown at the beginning of October.  This will probably play out as it always does.  Lots of talk and then a last second deal.  The overall market was stronger than the Dow today and that is bullish moving forward.  Perhaps we'll work off the extreme overbought condition for the market here and then head higher.  That's a guess as usual.  GE was off 1/2 and the volume was good.  The short term indicators have now rolled over here.  Gold got clobbered today as the futures were off over $35.  I found no reasons for the negative price action.  The US dollar was only slightly higher.  The XAU dropped 6 1/4.  ABX down 3/4, GG fell 1 1/3 and NEM off 1 2/3.  Volume was good.  The gold shares have given back all the gains from Wednesday.  That isn't bullish.  My October ABX calls have lost half of their value in 2 sessions.  This looks like another losing trade.  Mentally I'm feeling OK.  So perhaps the second half of September will prove to be weaker.  Hasn't happened yet.  Sometimes the following Monday after expiration we get the opposite of the previous Friday.  That's a clue that the Friday action was simply expiration related.  I'll keep an eye on that.  Plenty overbought on the stock indexes for quite some time.  Certainly a pause is overdue.  After the Fed on Wednesday what other good news is out there?  Gold had a volatile week and will need to turn around next week for the bullish cause to have a chance.  The daily candlestick chart doesn't look good after today.  The inverse head and shoulders pattern is still alive on the weekly ABX candlestick chart.  However we'll need to see some decent upside here soon.  I thought it was going to be this week but the last 2 sessions have canceled out that.  I might just have to bail out of that trade but there are 4 weeks to go.  Plenty to ponder over the last weekend of summer.  For now it's Friday afternoon and time for a break.

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