A bullish start to the month of July as the Dow gained 321 points on light volume. The advance/declines were 3 to 1 positive. The summation index is trying to turn back up. We now have the potential to continue the summer rally as there are bottoms above bottoms on the S&P 500 daily chart. The short term indicators there have also turned back up. Perhaps this time we can make it back to the first down trend line that comes in at around 4000. We'll have to wait and see what happens but I'm looking for higher prices going forward. Gold was off a buck but did bounce from the lows of the session at around $1790. The US dollar was higher and interest rates continued to drop. The XAU gained 3 points, while GDX was up 3/4. Volume was good here to the upside as buyers finally showed up for the gold shares. Could the decline here be finally over? It is possible with both the short and medium term time frames oversold. I am looking at the August and September GDX calls. I'm not in any hurry though as the confidence level of my ideas is certainly at a low. Mentally I'm feeling OK. The VIX dropped on the rally and that makes perfect sense. Still not through the first line of resistance at 26 but another day like today would do it. That would fit in with the summer rally theme that we are looking for. The short term indicators for the VIX are getting to short term oversold though. I'll mention the fact that bonds have made quite a move higher in the past couple of weeks yet interest rates are supposed to keep increasing. That does not fit the normal relationship and something will have to give one way or the other going forward. A long summer weekend and plenty of charts to go over as well. Perhaps we'll come up with an idea for the remaining two weeks in the July option cycle. Asia was lower and Europe higher to end the week. It's Friday afternoon and time for a break.