Friday, January 25, 2019
Back to upside for the Dow on the hopes that the US government stalemate is over. The most watched index rose 184 points on average volume. The advance/declines were 3 to 1 positive. The summation index continues to move higher. Getting closer to the resistance at 270 for the SPY and closer to the VIX level of 16.5 which is my threshold to get short. Now this may not be the right idea but technically it is where you take a shot. We'll see if we get there next week. GE was up over 1/3 on good volume. Earnings due here next week so we should see some movement then. Which way is the question as always. Gold had a stellar day as the futures jumped over twenty dollars. The US dollar got slammed. The XAU gained 2 1/2, while GDX rose 2/3. Volume was slightly above average. My GDX February calls are in the black. If GDX can get through 21.5, I'm guessing we'll make it to 22. Mentally I'm feeling OK. We've got the Fed next week but it's assumed there won't be any surprises coming there. Economic data could start to be released if the government reopens as anticipated. Supposedly a three week reopening has been agreed to. But in this day and age, I'll believe it when I see it. There's also some US/China tariff meetings scheduled for next week as well. So there will be plenty to watch but most of all I'll keep an eye on the technical indicators and see if they reach the action points. However I will certainly be double checking my work over the weekend. We are still short term overbought on the major stock indices. Gold and the gold shares however have moved up from being oversold. Not overbought here yet but heading in that direction. It looks like the GDX February call trade could work but we all know that market goes where it wants. Gold did close above the 1300 level on the futures and that's a plus for the bulls. Resistance comes in at 1320. Plenty of charts to go over this weekend to get ready to close out the month. Europe and Asia moved higher with the exception of England again. It's Friday afternoon and time for a break.
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