When we warned of an imminent 320-point fall in the Dow Sunday night, we admonished subscribers not to share a related S&P target with their friends, lest the publicity 'queer' the prediction. We needn't have worried. Yesterday the S&P futures completed their multi-day plunge, falling to within a quarter of a point of our 1385.25 target; then they trampolined 30 points higher, closing just off the intraday peak. We had reiterated our faith in the target the night before with the following trade recommendation: 'The 1385.25 target given here earlier remains not only valid, but compelling as a place to trade speculatively for a strong bounce. Use a 1383.75 stop-loss initially, switching to a 2.00-point trailing stop if 1394.00 is hit on the rebound. Reasonable upside objective: 1401.50.' The 1.25-point stop-loss proved more than sufficient for getting long at the low of the selloff, and anyone following our advice exactly would have been filled on his or her bid, since the actual low occurred a single tick beneath it. In the meantime, Comex Gold was moving with equally precise deference to some key numbers we'd flagged. (See chart above.) The bad news is that the February contract played footsies briefly with The Beast, plunging to within a single tick of a threshold where trouble was bound to begin. Here's what we wrote in Tuesday's 'Tout' for Comex Gold: 'Yes, I know, I've been promising you at least 902.10 over the near term. But there is no getting around a lesser impediment at 896.90 that will have to be reckoned with first. Hidden Pivot aficionados will recognize its authority in the chart below: single-bar price points, sinuous symmetry and an all-but-indomitable trajectory. Since the futures topped yesterday at 894.40, we could infer that an additional $2.50 of upside is due us.
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