We ended the day with a slight loss on the Dow as we lost 16 points. Volume was light and the advance/declines were positive. The overall market was stronger than the Dow. We are now short term overbought. That doesn't mean that we can't stay that way. I dumped the OEX puts for a 75% loss. I should have sold them yesterday as this was a trade that did not work at all. It happens. Today was probably a better day to purchase some puts. I have no other OEX trades in mind at the moment. GE was flat on light volume. I still have the open order in for the January GE calls. Gold lost $10 on the futures and the XAU dropped 1/3. The US dollar was flat today. ABX and GG had fractional losses and NEM fell 7/8. Volume remains very light here. The gold shares were lower early and came back. I think my next trade might be here but we'll see. Mentally I'm feeling OK. Not exactly pleased about taking the recent OEX loss but you've got to keep moving on in the game. 8 days left for the October option cycle. Short term overbought on the stock indices but the summation index is moving higher. I have no clear ideas at the moment. I do have the open orders in for GE and ABX but they are on a longer time frame. The market is news driven lately and we have a Senate vote on the jobs bill coming up along with a European bailout vote. We'll see how things go tomorrow.

The Dow took off to the upside today on good news from Europe as we gained 330 points on light volume. The advance/declines were 10 to 1 positive. It was a partial holiday for Columbus Day which probably explains the light volume. The summation index will now be trending higher. The decline is now over in my opinion. My OEX puts are dead. I'll be taking the loss tomorrow which I really should have done today. Declines can be bought from now on. GE rose 2/3 on lighter volume. We've made it through the 50 day moving average and are at the top of the congestion zone. We should break through to the upside shortly. Gold was up $35 on the futures and a bit more in the aftermarket. The US dollar got slammed today on the good news out of Europe. The XAU gained 6 1/3. ABX up 1 1/3, GG rose 1 1/4 and NEM led the way higher by 2 1/8. Volume was extremely light here. I'd still like to get some gold share calls for November on a pullback. Mentally I'm feeling OK. I still have to open orders in for the January GE calls and the November ABX calls. I'll be leaving them in for now. Not happy about the OEX put trade but you take your chances sometimes in the game. We will most likely simply be going higher from here. Fed beige book out tomorrow and that's about it for news. We'll see what kind of follow through we get tomorrow.

An up and down day as the Dow opened higher, sold off, came all the way back and higher only to sell off at the close. We ended the day with a loss of 20 points on average volume. The advance/declines were over 2 to 1 negative. The overall market was much weaker than the Dow. The employment report came out and was much better than expected. The market tried to rally but couldn't. That may or may not be telling going forward. My OEX puts are in the red as the timing wasn't as good on the entry as it good be but what can you do? That is the trouble sometimes with the stock index options. The timing has to be exact and nothing is exact in this game. The volatility and time premium in the options are already starting a rapid decay. I also had to lower the strike price which certainly doesn't help things. It's not a complete lost cause but I'm not counting on this to be a good trade. GE was flat on the day after trying to get through its 50 day moving average. Volume was average here. I'll be keeping an eye on things here as a proxy for the overall market. It seems to be working that way lately. Gold lost around $17 on the futures and the XAU fell 4 1/4. The US dollar ended little changed despite the good employment report. ABX, GG and NEM all dropped a buck on light volume. I think the gold share calls are the way to go if we retest the recent lows. I'm leaving in the open order for the November ABX calls. Mentally I'm feeling tired as I did not sleep well or long enough. The beginning of next week will be the key. We are at the levels on some of the technicals that have turned back any recent rally attempts. If that remains true, then the OEX puts I own will have a chance. If not, then I believe that the decline is over. That's my best guess at the moment. We didn't rally on good news and that may be telling. Monday is a partial holiday with Columbus day so that may skew things. Plenty to ponder over the weekend. For now it's Friday afternoon and time for a break.

The rally continues and seems to be for real at this point. The Dow gained 183 points today on average volume. The advance/declines were 6 to 1 positive. Todays action will turn the summation index back to the upside. I went down to a lower strike price and purchased some OEX puts near the close. That was the game plan and I stuck to it but I wouldn't be surprised if it doesn't work based on the recent market action. However it will all depend on the markets reaction to tomorrows jobs report. We've worked off the oversold condition and some of the technicals are back at the levels that have begun the down moves. So we'll see what happens. GE rose 1/4 on average volume. Almost to the 50 day moving average line that has been resistance. I'm leaving in the order for the January calls. Gold gained over $10 on the futures as the US dollar was weaker again today. The XAU rose 4 3/4. ABX up 1 1/2, GG climbed 1 3/4 and NEM higher by a buck. Volume was average. It really looks like I missed out on a good opportunity here as both ABX and GG have risen well over 10% in the span of 3 days. I'm leaving in the open order for the November ABX calls but doubt it will get filled at the price that I want. My hope now is for some backing and filling in the gold shares to get long. May not happen. Mentally I'm feeling OK. Still 2 weeks to go in the October option cycle. All eyes will be on tomorrows employment report. So far it seems to me that we have had a huge snap back from the lows on Tuesday in the stock indices. If we continue to rally tomorrow, I'd say that the recent decline has run its course. If not, who knows? I'll be hoping that gold returns to its recent lows but hope is no way to trade. We'll see what the market reaction is to the employment news and take it from there.

Building on yesterdays one day reversal as the Dow gained 131 points on average volume. The advance/declines were almost 3 to 1 positive. Now we must ask if the recent lows are the end of the downtrend and is the 2 day rally for real? I don't have the answers. I would still like to own some OEX puts before Friday. However with bullish engulfing patterns on the stock indice daily candlestick charts, that may not be the proper trade here. The weekly charts now look bullish as well. That could all change with Fridays employment numbers though. So it will be a tough call as to what to do tomorrow. GE was up 3/8 on good volume. I did place an order for some January calls today. I'm leaving it open until it's filled or I decide to do something else with it. Gold rose $25 on the futures and the XAU gained 8 points. The US dollar was lower today. ABX up 1 2/3, GG higher by 2 points and NEM tacked on 1 3/4. Volume was average. I also placed an order for some ABX November calls but I may be too late here as well. Perhaps if we get some backing and filling here, the order will get filled. I do not want to chase things here as I still think there is a chance for more decline in the overall market. Mentally I'm doing OK, slept well. I'll really need to decide tonight what to do, if anything, before Fridays employment numbers. Yes, I could always just sit it out and wait for the markets reaction. But if we get a huge decline from the start, it will be too late for the OEX puts. There's always the possibility that the numbers aren't that bad and we continue to rally. The technicals are moving up from being very oversold. I'll mull things over tonight and decide what to do for tomorrow.

We had a one day reversal to the upside as the Dow opened lower and closed higher. We ended the day with a gain of 153 points on good volume. We were down almost 250 points in the morning. The advance/declines were positive. Is this the short covering rally that we're looking for in order to purchase some OEX puts? Could be. In bear markets we see strong rallies that spring up out of nowhere. Todays action qualifies under that criteria. Is today the end of the recent decline? Time will tell on that one but I'm inclined to think that we aren't done with the downside yet. I could be wrong and often am. GE was up 1/8 in reversal mode as well. Volume was heavy. I thought about putting in the order for the January calls but we are not yet at the price I'm looking for. We also have earnings coming out on October 21st which could complicate things. However I am going to get some calls at some point. Gold took it on the chin today, down over $40 on the futures. The XAU fell 6 1/4 but was lower during the session. ABX dropped about 1 1/2, GG down 1 3/4 and NEM lost 2 bucks. All had heavy volume and also cut their losses dramatically in the final hour of trading. I also considered putting in the orders for the November gold share calls as well. The daily candlestick charts are now looking positive for the gold shares. We are oversold and todays action looks like a bottom has been put in. That could all change tomorrow though in this volatile marketplace. That is just one of the problems here. You don't want to be too early. Mentally I'm doing OK. Fridays employment report still looms big at the end of this week. However a lot of the stock indice charts are now showing bullish candlestick reversals. I still might get some OEX puts before that report is released. Plenty of time left in the October cycle. Might be time for the gold shares as well but not if we get another down leg following Fridays employment report. Nothing is certain in this game as we well know. We'll see if we get any follow through to the upside tomorrow.

Starting October where we left off in September as the Dow lost 258 points on good volume. The advance/declines were almost 10 to 1 negative. Index puts are the place to be and I don't own any. The premiums are still very high on the options. We've broken the consolidation in the S&P 500 to the downside. Now it is simply a question of how low we go. We haven't even gotten to Fridays employment number yet. So we'll see what happens. I have a couple of ideas longer term involving GE and the gold shares. I suppose I'll be looking for entry points. GE helped lead the way down today, off 1/2 and closing on its low for the day. Volume was good. I still want to get some January calls here. Gold had a good day with the futures up $35. The US dollar was higher as well in the flight to safety. The XAU fell 2 points though. ABX dropped 3/8, GG was flat and NEM gained 1/3. Volume was light here. I'd like to get some gold share calls eventually. I'm looking to go out to November. Plenty of time there. The Gold/XAU ratio is off the charts to the buy side but that indicator hasn't been working lately. Mentally I'm doing OK. Trying not to get caught up in not owning any OEX puts as we fall here. Perhaps there will be a short covering rally this week before the employment report. Wishful thinking there. I have a couple of ideas with the longer term GE call options for January and the gold share calls for November. The summation index has turned down again but it's been in a range lately with no extended moves. We'll see what happens tomorrow.