Wednesday, November 13, 2019
Back and forth today as the Dow gained 92 points on above average volume. The advance/declines were slightly negative again. The summation index is starting to roll over. The overall market was weaker than the Dow with the NASDAQ in the red. The market seems to be in a churn here as the overbought condition persists. I really think that some corrective price action is necessary before we go much higher but I cannot rule out a grind upwards during expiration week. The Fed chairman testimony was a non event. The TRAN and RUT were both lower. My thinking on the next SPY trade is to get through this week and we'll take it from there. GE was off 1/8 on average volume. Gold was up $7 on the futures. The XAU and GDX had fractional gains on light volume. I'm leaving my GDX January call trade out there but will adjust it lower if the gold shares start to decline here. Another run down to the 26 level for GDX should get this trade filled. But I must admit the background for the precious metal now is not as bullish as it was earlier in the year. Mentally I'm feeling bit tired, did not sleep well. We've been in a sideways drift higher for the S&P for the past week and a half. We have hit new all time highs but the action hasn't been exactly what you'd call robust. Of course some kind of trade headline out of the blue could get things going either way but we can't take positions based on that. I still think things need to go lower before we can get going much higher. A trip back to the former resistance at 3025 would do the trick. Until then we'll have to wait on the SPY for now. Gold has been drifting lower for 2 1/2 months. That has worked off the overbought conditions but there aren't any near term catalysts to move higher that I can see. That is why I'm willing to go out until January on the gold share calls here. It would give the trade some time to work. Bu that also means that would could just continue to drift here as well. The trading is never easy. Europe and Asia were lower. We'll see what tomorrow brings.
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