Once again we had a gap lower at the open and spent the rest of the day making up lost ground. The Dow fell 142 points on what is now considered average volume. The advance/declines were around 3 to 1 negative. The summation index is rolling over. The NASDAQ eeked out a small gain. The short term indicators for the S&P 500 are trying to turn back up. Producer inflation data was hotter than expected but there was no follow through selling after the open. So the market is trying its best not to collapse here. I'm not sure if it means a rally is coming or if it's just option expiration week related. We'll know as time moves on. I am still looking for lower prices in the autumn but I could be wrong. Gold dropped around thirty bucks on the futures. The US dollar was higher along with interest rates. The XAU lost 4 3/4, while GDX dropped 1 1/8. Volume was heavy to the downside. Perhaps this is the final washout for the gold shares. I did place an order for the GDX September calls overnight in case we got a huge drop. We did and the order was filled. It is showing a small profit. The stop loss order is in. This trade seems like the proverbial catch a falling knife scenario. The gold shares are overblown to the downside. The Gold/XAU ratio is very high. GDX is both short and medium term oversold. I might be early on this particular idea. But I believe that after the Fed meeting we'll get the 2nd quarter GDP report which will show a negative print. If that occurs I think the dollar will start to fall and gold will see a comeback. We're still a couple of weeks away but when I placed the order last night I really did not think it would get filled. However the gold shares gapped lower like the overall stock market and now we're in the trade. Mentally I'm feeling OK. The VIX was lower again today despite the drop in stocks. Once again I'm not sure what that means but the daily chart looks like it wants to go lower. The short term indicators for the VIX are turning back down. This would imply higher stock prices going forward. We'll see. Europe and Asia were down with the exception of Japan. We'll see how expiration Friday goes tomorrow.