Thursday, November 14, 2019
The market continues to just hang around here as the Dow was off a point on light volume. The advance/declines were slightly positive. The summation index has rolled over but isn't moving steadily down yet. Most of the major stock indices remain overbought. We are in a sloppy, slightly upward congestion zone for now. I do think that whichever way it breaks won't hold for long regardless of the direction. There are no catalysts long or short here at the moment. Perhaps the next US/China trade headline will get things going. Retail sales data is out tomorrow morning, maybe that can get us moving. It's also options expiration Friday. GE was flat and the volume was very light. Gold continued higher as the futures added another $7. The US dollar was lower. The XAU and GDX again had slight fractional gains on light volume. It appears that I've missed the GDX call trade again but the price velocity here isn't what it was. So I'm thinking that I still may have a chance here on a decline in the next couple of weeks if it occurs. The technical indicators are now mid-range for the gold shares. The limp rally that we've seen in gold isn't impressive and a turn around would not be a surprise. Mentally I'm feeling OK. Not exactly sure what the market is waiting here for. We are either building some type of a short term top or consolidating before breaking out to new all time highs again. Take your pick. We'll be rolling into the December option cycle next week and they have an extra week in them. Therefore premiums will be higher than normal and that makes for even tougher decisions. We will not remain overbought forever and somewhere in that cycle will be a chance for the SPY December puts to work. The VIX tried to pop up today but fell back. We are however working the short term indicators back to the middle of the range. I still think that any decline will be shallow and stopping at 3025 on the S&P 500 if one ever occurs. That's my best guess for now. Europe and Asia were lower once again. We'll close out the trading week tomorrow.
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