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At least I got the volatility right, but what about the upward bias. As mentioned in many blogs since the April 23rd peak in the market, I suggested that there was strong evidence pointing to a more than nominal correction in the market. It is down twelve percent from its peak, and I believe we are near a correction bottom. The evidence still supports a correction rather than a top in an ongoing bull market, and the recent downward volatility does nothing to dispel that theory. With the market at extreme oversold levels, I look for a weak opening this morning with some kind of reversal this afternoon. If I’m wrong about correction versus top, I’ve rolled our June puts into September with a strike price about ten percent below the market. Stay tuned.

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The multi-billion dollar bailout of Greece was greeted by a sigh of relief, but what does it say about the euro currency and the possibility of more bailouts to peripheral countries. Given the relative strength of gold recently, it would appear that people are beginning to look at the metal more as a hedge against currencies than merely an inflationary hedge. I think it prudent to add to our already significant position in gold, and I am doing so today with the addition of Newmont Mining (NEM).