Thursday, October 22, 2020
Higher today as the market shrugged off overnight bad news. The Dow gained 152 points on good volume. The advance/declines were better than 2 to 1 positive. The summation index is tracking sideways. The S&P 500 has held its 50 day moving average. The short term technical indicators appear to be trying to turn back up and they remain mid-range. I'm still looking for higher prices going forward. The market remains hostage to the pandemic, upcoming election and stimulus negotiations. However with plenty of time in the November option cycle, there's no rush to trade. GE was up 3/8 on average volume. Gold dropped back today as the futures fell twenty bucks. The US dollar was higher. The XAU shed 1 2/3, while GDX lost 3/4. Volume was light. The gold shares did rebound from their worst levels of the day. My order remains out there for the GDX November calls as todays drop was not enough to trigger it. I do think that GDX will eventually trade higher although we cannot rule out and extended sideways pattern. That's about what we're seeing now. Mentally I'm feeling OK. The VIX fell and that coincides with a rise in stock prices. The short term indicators here have rolled over and imply higher prices going forward. If we can get the summation index moving up again, that would be the all clear for a rally. Hasn't happened yet but I do think that it will. May have to wait until after the election though. For now we'll watch and wait for a good signal one way or the other. Europe and Asia were generally lower in last nights trade. We'll close out the week tomorrow.
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