for pretty much everything, especially gold stocks – the bigger they were the harder they fell. They tested the previous week's lows and failed - breakdowns everywhere. The smaller stocks did a little better – GDXJ did not (yet) breach last week's lows. Overall, it was a very disappointing week for gold stocks, especially since May is generally a good month for the group.

US markets did not fare much better – just about all indexes have generated a MACD sell on the weekly charts. Monthly charts are still positive, so it's likely just a continuation of the sideways correction that's been going on for the last couple of months. I don't think US markets will have a major correction – too many dip-buyers out there, methinks. Also, in typical election years, the low point of the year tends to be around the end of May.

Despite last week's carnage, there is hope. Venture only lost 0.54% - the best weekly performance of all North American indexes. Transports were next with only a 0.75% loss. Finally, Shanghai was actually up 2.32%, and continues to look reasonably good. Taken together, these are leading indexes and indicate that things may improve soon. Of course, if they break down next week that should be respected, and it really would be time to head for the hills.

I still think the gold stocks will turn soon, but I'm not going in whole-hog. In fact, I've been sort of averaging down without putting in new money. As I've previously mentioned, when bottom-fishing, I sell slightly out-of-the-money puts rather than buy stocks. If I'm early or wrong, the stock gets assigned. If I think I was wrong, I simply dump the stock and move on. If I think I was just early (like now), I sell the assigned stock, but also sell another put, this time slightly-in-the-money. That way, I collect another premium without committing to owning more stock. Assuming the stock does not take off before options expiry, it will get assigned again, but my cost will be lower because of the premium I collected (in-the-money- premiums are larger). The risk is that the stock takes off without me and I don't get an assignment. Not a big deal – I still get to keep the premium. Point is, it's not possible to be right all the time, but it's possible to reduce the impact of being wrong.