Traders have given President Obama’s first press conference a tepid response, although the selling Monday night looked more like a shakedown by clever buyers than an attempt to discount bad news. The E-Mini Dow futures were off as much as 100 points as the President spoke – although not, we would surmise, because he surprised or disappointed anyone. In fact, most of the questions, even the one asked by the AP’s battle axe, Helen Thomas, were pretty tame. Amidst the worst economic crisis since the Great Depression, Obama found time to address Alex Rodriquez’s apparent use of steroids. While there is no question that this continues to be a serious issue for Major League Baseball, in the context of the catastrophic economic news that has dominated the headlines, A-Rod’s confession could probably qualify as comic relief -- or just plain relief, if you’re Barry Bonds. We’re not sure we’re ready yet to ascribe the trait of arrogance to the new President merely because he has been insinuating that anyone who opposes his economic stimulus package is practically an enemy of the state. If so, then Lew Rockwell would qualify as Benedict Arnold. At his web site, Rockwell was comparing Obama to Bush, post 9/11, asserting that the ex-President had come to the office feeling that he was entitled to start a war. Similarly, says Rockwell, Obama has been acting as though he thinks he’s entitled to a blank check for a trillion dollars, the better to launch his own version of FDR’s New Deal. For his part, Obama denies that he envisioned spending his first weeks in office pushing a massive spending bill through Congress. Whatever he envisioned, he seems absolutely certain that more government, and vastly more spending, is the only way to address the problem. Politically
Monday, February 9, 2009
IBM (96.14)
– Posted in: Current Touts Free Rick's PicksLet's try to get in Big Blue's face this week by shorting a Hidden Pivot resistance at 102.87, the 'D' target of the pattern shown in the chart. If you're interested in this trade keep your Bulletin Launcher turned on, since I'll diesseminate a price for March 100 put options when appropriate. We should also look for a long- entry opportunity in real time in the chat room, since the target implies more than $6 of upside from these levels.
GDX Gold Miners ETF (35.49)
– Posted in: Current Touts Free Rick's PicksOur bullish covered write on 200 shares -- stock at 31.12 versus Feb 25 calls for 2.55 -- will yield a fat theoretical profit with the underlying stock trading $29 or higher. Our maximum theoretical return of $1,286 would come with GDX $35 or higher, a prospect that seems increasingly likely. In fact, the immediate upside target is 40.85, implying a rally of about 12% from these levels. It should be considered well under way if and when the stock closes above 36.43, the midpoint sibling of the 40.85 pivot.
April Gold (899.00)
– Posted in: Current Touts Free Rick's PicksAbout to enter its 12th day of tedium, gold is quite obviously in no hurry to move up to the next plateau, 945.90, let alone take on the $1000 barrier. The midpoint sibling of that Hidden Pivot is 918.10, as noted here earlier, and we should want to see a close above that number before we infer that bulls are keen to inflict damage on the likes of JP Morgan and other nefarious agents of the Federal Reserve. From a trading perspective, there were two Hidden Pivot supports available on Friday where one could attempt bottom-fishing with tight stops: 909.20 and 901.00. However, both may have been pulverized by the time you read this if Sunday's opening is lacking in delicacy. _______ UPDATE: The second of the two pivots given above, 901.20, would have worked nicely for bottom-fishers, even those using a stop-loss as tight as three ticks, since the futures managed an $8 bounce from 901.20. It was short-lived, however, and the April contract had relapsed to as low as 895.00 in the early going on Monday. The nearest logical support was 890.30, equal to a key intraday low recorded a wek ago.
E-Mini S&P (867.75)
– Posted in: Current Touts Free Rick's PicksWith this sub-par short-squeeze about to enter its third day, a Hidden Pivot resistance at 882.75 is about as high as we should expect over the near term. The provenance of this target is shown in the accompanying chart. It looks almost too pretty to short, though, given the picture-perfect symmetery of the pattern that produced it. However, from an analytical standpoint, an easy move through the resistance would hint of more carnage to come for bears who may have placed themselves in harm's way. The futures looked set to pop above a key high at 876.00 recorded on January 28, but until that happens, pivoteers can use the 15-minute chart to find leverage-able abc patterns with impulse legs subtle enough to yield low-risk entry opportunities.
