The SPY buy signal earlier this week failed to work beyond two days and we knew this earlier on. As such, we locked in our 22% gain on the SPY Calls. Now we are back to my oversold indicator hitting 19 on $SPY. Under 30 is oversold. Above 70 overbought.
I expect to be a call buyer in short order again, from sometime this afternoon to Friday or next Monday worst case. Could today be a case of sell the rumor and buy the news? I am in the camp of Fly that the action today will end up being a none event. Machines are just doing what they do.
On days like today I keep BloombergTV on in the background when not on calls. BloombergTV is for adults and CNBC is for teenagers. The upcoming Trump trade announcement is all about positioning and not about starting a trade war. The Chinese will respect this trade and it will blow over more than likely just like other Trump tweets and appearances.
For those looking for a trade yesterday in my gold and energy options service I recommended buying April $21 $GDX Calls. They are cheap if $GDX can breakout here. I recommended at $1.25. They are in the money at $22.25 and the ETF is at $21.67 so still in the money by $0.67. The calls are now at $1 so you can pick up cheaper. I will alert here when I close out the trade.
P.S. I heard that Super Mario’s portfolio which was 100% gold has added $GDX to make the quarter.
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