Thursday, October 24, 2019
Kind of a mixed bag today as the Dow fell 28 points on better than average volume. The advance/declines were slightly negative. The summation index is still moving up. The overall market was much stronger than the Dow. The NASDAQ and the S&P 500 both showed gains. Overbought and staying that way for now. Earnings have come in OK so far and they are not having a negative effect. Waiting on the Fed next week at this point. Very close to new all time highs on some of the stock indices and we should see them soon. No headlines out of the blue. GE was off almost 1/4 on lighter volume. Gold found buyers today, the futures were up $10 and we're back over the $1500 level. The US dollar rose as well. The XAU climbed two points, while GDX added almost 3/4. We have just risen slightly above the declining tops line for the gold share indices that started in the beginning of September. The break of that line would put us back in rally mode for the gold shares. It appears to be in the cards at this point. I did adjust my open order for the GDX January calls but it wasn't filled. I my adjust it again tomorrow. This would be one of those times where it may pay to chase the move. Not that doesn't really fit in with my guess of no change in rates on Wednesday. However the charts provide much better information than my guesses. If for some reason the gold shares drop again tomorrow, I will have to rethink what I'm doing. But it looks like the rally in precious metals is about to pick up again right now. Mentally I'm feeling OK. The VIX remains oversold and the rally in the overall market continues. We remain comfortably below the 16 level and as long as that continues the rally is on. Perhaps the Fed will lower the fed funds rate again next week but I certainly don't think that it has to. I suppose I'll wait and see how things look technically before the announcement on Wednesday and take it from there. If we get a weak break to new all time highs in the S&P, I'll consider the SPY November puts. Gold on the other hand, looks ready to begin another climb if it can get above the declining tops line in the next few sessions. Perhaps even tomorrow if we get some upside follow through. My hope is that I'm not too late but that may be the case. Europe and Asia were higher overnight. We'll close out the trading week tomorrow.
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