Friday, July 20, 2018
Pretty quiet as far as expirations go as the Dow lost 6 points on light volume. The advance/declines were slightly negative. The summation index is moving sideways. I'm thinking that the summation index is moving sideways before it heads lower. But that's just a guess at this point. The market remains both short and medium term overbought but that doesn't mean it can't stay that way. Plenty of earnings due next week and we'll have to see what the reaction is to the numbers. Some economic data due out next week capped off by the first look at 2nd quarter GDP on Friday. The tone of the market has seemed to slow here in the middle of July. GE dropped almost 2/3 on very heavy volume. The earnings were OK but I guess they didn't like the talk from the CEO. I don't have any trades in mind for GE. Gold was up $7 on the futures as the US dollar took a hit today, possibly because Trump complained about the rise in US interest rates. But the Trump effects on the markets are generally short lived because he changes his mind from one day to the other. The XAU and GDX had slight fractional gains on average volume. The gold shares certainly did not react to Trump. Mentally I'm feeling OK. My GDX September call trade is showing a small loss. I'm inclined to hold this trade for some time, since there's an extra week in the September option cycle. I also would like to give a chance for the seasonal strengthening pattern to go into effect. So I'll be holding on for now. There is also a potential positive RSI divergence that just took place on the daily chart. If that actually happens, this trade should turn out to be a winner. RUT is stalling here but it may simply be a pause before it moves to new all time highs again. A lot will be determined next week as the big tech stocks are due to report. I'm still considering the SPY August puts. Asia was up and Europe down in last nights trade. I'll be checking the charts over the weekend to come up with some kind of idea as what to do next week. For now it's Friday afternoon and time for a break.
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