Sellers remain in control as the Dow fell 316 points on average volume. The advance/declines were around 3 to 1 negative again. The summation index is moving down and we will take our cues from that. It has been an orderly decline thus far as panic has yet to arrive. The inflation data for producer prices came in about where expected. The Dow, NASDAQ and S&P 500 all dropped the same percentage. The short term indicators for the S&P continue to fall and are short term oversold now but not completely. The S&P has broken its up trend line along with closing below 7600 and its 50 day moving average. I suppose tomorrow will tell the story if we are headed for a steeper decline or perhaps if the inflation data is OK, some kind of bounce. We have missed the SPY September put trade it appears. Gold was down $96 on the futures. The US dollar was higher and interest rates jumped. The XAU lost 14 2/3, while GDX dropped around 3 1/3. Volume was average. The short term indicators for GDX are still heading lower with room to go. I still like the idea of the GDX calls at some point before option expiration. I might even place an order for them overnight in case the inflation number comes out hot and stocks tank early in the morning. But next week might be a better time to purchase. There is also the possibility that things fall apart for the market here and gold goes along for the ride. Which would make purchasing any calls the wrong strategy. There will be a lot of risk in taking on any trade now as we are running out of time in the September option cycle. Mentally I'm feeling OK. The VIX was up again but stopped at its 200 day moving average. The short term indicators here are now overbought. Still below the 20 level. If the VIX stays overbought there will be more downside in the markets to go. That usually doesn't happen though. Interesting times but caution is advised. Asia was mixed and Europe lower overnight. We'll see how the inflation data reads and go from there.