Tuesday, August 04, 2020
Another day, another gain as the Dow climbed 164 points on average volume. The advance/declines were once again about 2 to 1 positive. The summation index is trying to turn up here. We trended sideways for most of the day and then went up in the final hour to close near the high for the day. Overbought, staying that way and at this rate we'll be back to new all time highs before the August option expiration. It looks more and more that my idea for the SPY August puts ahead of the employment report on Friday is the wrong one. That said if we do continue higher into Thursday or even tomorrow, I may give that idea a shot. But it does seem that there is so much money out there to purchase things that a decline would only be short lived. This is one artificially propped up market to be sure. GE was up three cents and the volume was lighter. Gold is a runaway freight train that I should be on. The precious metal futures jumped $45, yes $45 in a single session. The US dollar was slightly lower. The XAU was up 6 1/2, while GDX added almost two points. Volume was average. Any and every short decline is being bought and I certainly know this and should have bought some calls here recently. This is a move that can be chased. Todays rise was pretty massive though and at some point some real profit taking will kick in. Gold closed above $2000. It probably has more room to go up. It is acting like a mania though at this point. I'm looking for a weaker jobs number on Friday and a continued gold rally into the close that day. Mentally I'm feeling OK. The VIX was lower and remains oversold. It isn't generating any kind of clear signal for me at the moment. SRNE, which I canceled my order for the calls there yesterday, was up $3. HOLX, which I missed out on, continued higher. Money certainly is flowing into the pandemic virus stocks. I'm not sure why I haven't tried them but I do think it has to do with the fact that it really isn't my area of expertise. Or perhaps I'm just too lazy to pay attention to these ideas. Successful trading does require a good ability to focus. I think that recently I've maybe tried to do too many things at once. I should probably just stick to the SPY and GDX. There's always opportunities there if you're good enough to take advantage of them. Right now it appears that there's no way to go but up for them. I'm sure that won't last forever but it is hard to get in front of that momentum. Asia was higher and Europe mixed in last nights trade. We'll see if there is nay upside follow through tomorrow.
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