Tuesday, January 14, 2020
The Dow added another 32 points today on good volume. The advance/declines were slightly positive. The summation index is basically moving sideways. The overall market was weaker than the Dow today, the opposite of yesterday. The US/China trade deal was back in the headlines via tariffs. The deal is to be signed tomorrow and I'm hoping it's a sell on the news event. Pretty much everyone knows the deal is done and there shouldn't be any surprises either positive or negative. But you never know. The negative RSI divergence remains in place for the S&P 500. Hasn't meant anything yet. My SPY January puts are still in the red and I should be getting rid of them tomorrow regardless. Three days to go in the January option cycle. GE was off a dime on light volume. Gold dropped below the important $1550 level but did come up from the lows of the session. It finished slightly lower. The US dollar was little changed again. The XAU was up 1 1/8, while GDX gained 1/2. Volume was average. My GDX January calls somehow made it back to a slight profit. Should dump these tomorrow as well. Mentally I'm feeling OK. We got a bit of volatility back in the market today when it was announced that the tariffs on Chinas goods would remain in place for the rest of the year. That's a trade deal? Regardless, the VIX did perk up but then fell back to near its low of the day. I suppose I'll simply have to see how we open tomorrow and go from there. The timing of the entry to the SPY put trade was off and that's a loss waiting to happen when there is only a week to go in the option cycle. We're still short term overbought for the S&P but the indicators are starting to roll over. However with only three days left for the January option cycle, there isn't really time to wait and see what will happen. It's possible that things will be quiet and we simply wander in to the end of the week. A holiday weekend is coming up as well. Europe and Asia were both higher in last nights trade. We'll see how they react to the tariff announcement tonight.
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