4:00 pm ET: The market took that catnap I mentioned yesterday and it turned out to be just that. About an hour and a half following the opening bell, the major averages woke up and began advancing. Maybe if the closing bell was delayed for another half hour they would have made it into the green (the Dow almost got there), but alas that is for another day. Judging from the internals, that day could be Monday. This morning's slump didn't much affect the VIX which managed to close at its lowest level in nearly a month. Take that all you bears!
Today's Trading Highlights: Precious metals continue to tarnish
The big news today was gold breaking its $1500 major support level (the $150 level on the gold etf (GLD). Following right in its footsteps were platinum (PTM, PGM, PPLT), palladium (PALL), and silver (SLV)--the latter which hit a new two year low. The break in these support levels suggests further downside which is rather interesting considering the sabre-rattling from North Korea who wants to see Tokyo toast on its breakfast menu. I'm not sure if this continued slide in commodities means that everyone thinks that North Korea's threats are empty or if everyone is just hoping it will go away. Should North Korea actually act on its threats, the continuing fallout in commodities could change in a heartbeat and for that reason alone, I'd be very wary of being in any type of leveraged inverse precious metal tracking fund such as the Gold Miners 3x Bear etf (DUST), the 3x Inverse Gold etf (DGLD), or the 3x Inverse Silver etf (DSLV). Today, all of these funds gained a whopping 15-18% and could gain much more but remember should precious metals rebound on headline news, these fast gains could easily turn into even faster losses. If you're holding physical gold and want to keep it, there's still time to buy protection but I'd recommend buying puts (on the GLD) since your risk of loss is limited to the amount of your initial investment. Just a word to the wise.
Have a good weekend!