Based on the S&P 500’s brash behavior lately, effortlessly blowing past Hidden Pivot resistance points major and minor, we wrote here recently that the fuse could be lit for a 130-point explosion. That would be equivalent to a Dow move of about 1000 points – a spectacular surge, especially if it were to occur over a period of not months but weeks. However, a coldly dispassionate look at the Dow’s monthly chart bolsters the case for an even bigger rally – a 1600-point moon shot. That would bring the Dow to exactly 16810, and although the target promises to be a great place to fade buyers, we’re not going to risk the farm on it. Nor do we plan on wasting our breath cursing bulls every inch of the way up. If they’re intent on pushing the blue chip average to nearly 17000, there’s no reason to fight the tape, especially since a pile of money could be made betting the pass line. » Read the full article
We’ve been using 9.57 as a bear market target for the Junior Gold Miner ETF (GDXJ), but a new target has come into focus that could see this vehicle bottom at even lower levels. For a graphic picture, check out today’s tout (or click here for a free trial subscription).
The rampage that I’d said could end the week is looking more like a quiet consolidation in the wee hours of Friday morning. This is understandable, given the dour economic news that has crossed the tape in the last two days. It’s also par for the course that the onslaught of bad news seems incapable of generating any real selling, only a shallow correction. I doubt that stocks will take off today, but camouflageurs should keep ‘turnaround Tuesday’ well in mind if the goal ahead of the next surge.
Tesla got short-squeezed to within 28 cents of the 86.72 target I’d proffered early Monday morning, but a second-wind rally to 88.00 suggests it’s got eyes for 104.44, the ‘D’ target associated with the first number. It can serve as a minimum upside objective for now, implying that all trades between here and there be positioned from the long side. We’ll plan on buying weekly puts if and when the target is reached, provided it happens before Wednesday of the given week. Please note as well that a lesser Hidden Pivot at 94.19 (see inset) has the potential to stop the rally cold and can therefore be used for spec camouflage shorts.
All signs point higher at the moment, but even Google will have to top somewhere. My best-bet for a short-able apex is 929.78, the Hidden Pivot target of a well-defined ABCD on the monthly chart (see inset). You can try shorting with camouflage at that number, or at the D target (in purple) of the lesser pattern, but until then all trades should incorporate a bullish bias.