Wednesday, May 28, 2014
Bounced around but spent most of the day about even until the final half hour. The Dow lost 42 points on light volume. The advance/declines were slightly positive. The overall market dropped less than the Dow and that is a positive. Today would have been a better day to purchase the June OEX puts. But what can you do? I should have done a better job on the entry. We should probably take a little time to build a top here, if this trade is going to work. My June OEX puts are still showing a small loss. GE was up a few cents and the volume remains light here. No trades in mind for GE. Gold had some follow through downside as the futures dropped six bucks. The US dollar strength continues. These two are now in sync with their inverse relationship. The XAU was off around 1 1/2. ABX, GG and NEM all had fractional losses on good volume. All are oversold and have been for weeks. No decent bounces and the gold shares are attracting no money at all. Perhaps I'll take a look at the calls if and when gold gets to $1200. Mentally I'm feeling OK. Two days left in the week and the month. Short term overbought for the major stock indices. We'll get the GDP revision tomorrow, perhaps that will get things going. It is almost as if we are in the summer mode for the market already. Despite the recent all time highs I do not think this is the right time to be bullish. Falling apart in the final half hour could bode well for those June puts. Gold has broken support and the next logical target is $1200. Until then it is simply a waiting game again. I'll be looking at the October option series for the gold shares. We'll keep an eye on the overnight developments and see what tomorrow brings.
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