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Tuesday, January 21, 2020

A lower start to the week as the Dow fell 152 points on heavy volume.  The advance/declines were negative.  The summation index is still trying to grind higher.  I'm not sure what to make of todays price action.  We bounced up and down all session.  Perhaps a top is finally trying to be put in.  A virus scare from China didn't help the bullish cause not did the beginning of the impeachment trail.  But it wasn't a complete sell off as the overall market was stronger than the Dow.  The TRAN took a good beating though.  GE was off over 1/8 and the volume was average.  Gold was only down a buck or two and did finish well above the lows on the day.  The US dollar was little changed.  The XAU added 1 1/2, while GDX was up 1/2.  Volume was slightly better than average.  I did place an open order overnight for the GDX February calls.  It was somehow filled when the market opened even though the buy price was lower than the low for that contract on the day.  I certainly cannot explain that but it is showing a profit already.  The stop loss order is in and hopefully I'll manage this trade better that the last GDX attempt.  Mentally I'm feeling OK.  The VIX had a move up today and we'll see if it follows through tomorrow.  I would like to get some SPY February puts at some point.  This may be the correct time or not as we have remained overbought for an extended period.  The trouble is that the option premiums for SPY are very high due to the extra week in the February option cycle.  I suppose that I will try and let this week go by and take it from there.  It is a short week with the Monday holiday behind us.  However the market is certainly not going to wait for me and if we do start to drop I may just have to jump on board.  Overbought has been the condition for weeks on end and it will not last forever.  Europe and Asia were lower as selling took place globally.  We'll see how it goes tomorrow. 

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