Wednesday, May 31, 2017
A bit more weakness to end the month as the Dow lost 20 points on heavy last day of the month volume. The advance/declines were about even. The summation index is trending sideways. The market started to sell off today but then came back. I'm leaving in my open order for the SPY June puts but I've adjusted it to a lower price. I do expect that we'll see some upside from here that could take the S&P 500 to new all time highs. If the volume remains light, that will be the opportunity to try this trade. If the volume picks up, then we are going higher than I anticipate. We are still short term overbought for the S&P. The Fed minutes came and went. I'd expect tomorrow to be a quiet session ahead of the jobs numbers on Friday. Perhaps if we get a rally out of that, it will give the chance for the SPY June put trade. That's a lot of ifs and we'll have to see how it all plays out. GE was up a couple cents and the volume remains pretty good. Gold rose $11 on the futures as the US dollar was lower again. Do the currency traders know something that we don't? The XAU and GDX were basically flat on light volume. The fact that gold continues to rise and the gold shares do not is not a positive sign in my opinion for the continued rise of the precious metal. I could be wrong. Mentally I'm feeling OK. We got a signal for weakness and we have seen some in the past couple of days. But it was not the kind of move lower that would show a lot of profit. So I am hoping that we'll see another light volume rally here to new highs and that will be the time to get short. That said, we know that the market rarely cooperates with our wishes. We'll be medium term overbought after tomorrow as well. So it is possible that things will line up in favor of trying the SPY puts. Europe and Asia were mixed overnight. We'll keep an eye on things overnight and see how the month of June begins tomorrow.
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