Tame inflation data led to rally as the Dow gained 86 points on loght volume. The advance/declines were better than 2 to 1 positive. The summation index is moving up. The overall market was much stronger than the Dow with the NASDAQ leading the way. Getting short term overbought on the S&P 500 and even with todays stellar gains there is still a potential negative RSI divergence on the S&P daily chart. Another up day tomorrow would negate that. The tight Bollinger bands on the NASDAQ seem to have it breaking out to the upside after todays price action. We are looking for the summer rally to continue. Gold took off higher as the futures gained $26. The US dollar got crushed and interest rates dropped. The XAU climbed 6 1/3, while GDX gained almost 1 2/3. Volume was heavy to the upside. The rally in the gold shares is for real. I placed a couple of orders for the July and August GDX calls in case there's a pullback. This is a move higher that can be chased in my opinion. Price and volume tell the story. The fact that the Japanese yen has started to rise cannot be overlooked as gold sometimes tracks this currency. The falling dollar is a plus for gold itself. Of course I'm a bit frustated having tried to trade the gold shares recently for losses and now not being on board for the move higher. But we will look to buy the GDX August calls on weakness as one of the technical indicator patterns that we look at says that this move up will have legs. We'll see. Mentally I'm trying not to lament about missing this move in GDX. Missed money is better than lost money as the saying goes. However not being able to purchase the GDX calls before this move up was a mistake. Had I not incurred the earlier losses there perhaps I would have had the mental capacity to do the right thing this time around. That is why we always say the mental capital is more important than any amounts of money involved. The VIX was lower and the short term indicators here have now rolled over. Not short term oversold yet on the VIX which implies that the rally has room to run. Producer inflation numbers out tomorrow. Asia was mixed and Europe higher overnight. We'll see what tomorrow brings.