Friday, October 18, 2013
More of the same as the Dow gained 28 points on good volume. The advance/declines were almost 3 to 1 positive. New all time highs for many of the major stock indices. The summation index is moving higher. The overall market today was once again much stronger than the Dow with the small stocks leading the way. This implies even higher prices moving forward. The Washington BS is done for now but will return at the beginning of next year. Earnings are coming out and look better for some than the lowered forecasts. Money needs somewhere to go and it is going into stocks. The Fed continues the easy money play. It will eventually end badly but that is not on the radar screen anytime soon. Technically remaining short term overbought for the stock indices. GE had a big up day on the earnings, gaining 7/8 on very heavy volume. A nice breakout above the previous resistance. If and when we fall back to the resistance in the coming weeks, it will be an opportunity to try the calls here. Gold fell $8 on the futures after yesterdays huge run up. No upside follow through here. The US dollar ended the session pretty much where it started. The XAU was off 1/2. ABX was flat, while GG and NEM had slight fractional losses. Volume was pretty light here and that is a good sign when prices are lower. Mentally I'm feeling OK. How much higher can we go here is the question considering the very overbought condition of the stock indexes. No doubt due for a breather. We are going to get plenty of old economic data next week including the employment report on Tuesday. Not sure what kind of effect the old news will have on things but regardless, the trend is up. Gold finally had a positive week and I would like to see that continue for my November ABX calls to have a chance at being profitable. Earnings for ABX due out on the 31st. I'll probably hold on for that unless we see some strong upside ahead of it. Not overbought yet for the gold shares. Of course we could simply resume the sideways to lower trend here as well. However gold itself did break a downtrend line on good volume this week. That should be bullish moving ahead. We'll see. It's Friday afternoon and time for a rest.
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