Tuesday, April 05, 2016
Heading lower as the Dow fell 133 points on still light volume although it was higher than yesterday. The advance/declines were just over 2 to 1 negative. The summation index is heading down. I do not think that this is the beginning of something big to the downside but I could be wrong. April is generally a positive month for stocks. The short term technical indicators are now starting to roll over for the major averages. Perhaps we will make it down to the 200 day moving averages. That would be the 2015 level on the S&P 500. Or things could turn around to the upside tomorrow as you know how things go in this game. My SPY April puts are back in the black. I would like to hold them until Thursday but who knows? GE was off 1/4 and the volume was lighter than yesterday. I'm not considering any trades here at the moment. Gold found a bid as the futures were up around a dozen. The US dollar was up just a bit. The XAU rose 2 points, while GDX added 5/8. Volume was good. Mid-range for the short term indicators here. Mentally I'm feeling a bit tired, did not sleep well. I'm trying to decide when to sell the SPY April puts. This week would probably be the most prudent as time is running out with only 8 days left to go. Plus the usually positive expiration week is coming up. We've got the Fed minutes tomorrow and that could get things going in either direction. World markets are weak at the moment and that supports the downside theory. The summation index has turned down and that supports lower prices as well. But the moves lower in the markets are always quicker, with the turnaround rapid as well. So we'll have to keep a close eye on the game for the rest of the week while in this SPY April put position. I would like to give it a couple more days but I could decide just to bail out tomorrow. Interesting game and a challenge as usual. Japan has led the way lower overseas as the yen has rallied and negative interest rates there haven't spurred growth. The NIKK looks like it wants to challenge the lows of February. We'll keep an eye on the overnight action.
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The broader market traded in line with the benchmarks with the BSE midcap and small cap indices gaining 0.10 and 0.33 per cent, respectively.
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