Tuesday, March 13, 2018
Lower today as the Dow shed 171 points on light volume. The advance/declines were negative. The summation index is still moving up. Some weakness was expected as we were short term overbought on some of the technical indicators. Whether or not this turns into some thing else remains to be seen. The overall market was weak along with the Dow this time around. However the VIX didn't move that much and volume was weak. The inflation data was in line with expectations. In political news, the US secretary of state was fired. Perhaps that led to some market uncertainty. But we'll stick with the technicals and look for perhaps some more selling this week. I have no SPY trades in mind at the moment. GE had its rally cut short and dropped 1/3 today on heavy volume. It looks like any trades done here need to be quick in nature. Take profits when you get them. Perhaps if we get back down to $14 I'll try the April calls here. Gold rose $5 on the futures as the US dollar was just a bit weaker. The XAU and GDX barely budged on very light volume. Mentally I'm feeling OK. Three days left in the March option cycle and it will be interesting to see where we go from here. The daily candlestick charts look bearish for the major stock indices. However we just saw how the three black crows candlestick pattern did not work out for the SPY put trade. That doesn't mean that you just throw out the candlesticks though. There's also the potential negative daily RSI divergence on the small stocks to consider. Another couple of days like today and that signal will be valid. Hasn't happened yet. I'm in a wait and see mode for now. I won't be forcing any trade here and I'll simply have to patiently wait for the next perceived signal. Last night Asia was mixed and Europe lower in trading. We'll see how it goes tomorrow.
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