Back to the downside as the Dow fell 405 points on good volume. The advance/declines were around 2 to 1 negative. The summation index is moving lower. Once again the NASDAQ led the way down and that is not a good sign it you're bullish. Many of the stock indices are right above their 50 day moving averages. Tomorrow will be pretty important if things don't hold in here. I do think that we're heading lower but would like a chance to get some SPY September puts. It doesn't look like I'll get that chance though. We are oversold on some of the short term indicators but in extended declines we simply stay that way. GE was off over 1/8 and the volume was good. Gold was off a few bucks and fell back from the highs of the session. The US dollar was slightly higher. The XAU dropped 2 1/2, while GDX shed over 3/4. Volume was light. I'm still looking at the GDX calls as the next trade. Not exactly sure which way to go now because if the market takes a big drop, the gold shares will probably go with it. The short term technical signals are not clearly in a buy or sell mode either. However the Bollinger bands are very tight so you can be sure we are about to see some type of decent price movement in the GDX very soon. I would like to be on the right side of whatever occurs. Mentally I'm feeling OK. The VIX was slightly higher today and is above the 200 day moving average. At this rate is doesn't look like we'll make it down to the 50 day. If that's the case expect a decline for stocks in the coming days. But we're just guessing what will happen at this stage in my view. The market will show us the way and I think tomorrow will go a long way as to what to expect here. A down session will put us at new lows for the move and make it two weeks in a row of selling. An up session will give the bulls hope that the recent sell off is just a consolidation instead of an extended decline. My thinking remains that we're heading lower, if not tomorrow then as we move along in time. Asia was generally higher and Europe lower overnight. We'll complete the shortened trading week tomorrow.