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COMMENTARY for Saturday
TODAY'S ACTION for Friday
Rick's Picks for Friday
This is heads-up, since we are close to getting filled on our order to short four June 10 calls for 0.70 against four September 10 calls we already hold for an average 0.69. Offer the calls on the opening for 0.65 — a nickel less than I suggested here earlier — but if the order goes unfilled, raise the offer to 0.70 and leave it in for the rest of the session. I would also suggest checking this tout after the first hour or so, since it may be advantageous to change our game plan on-the-fly.
The short-squeeze rally into the final bell turned chicken just shy of Wednesday’s supply zone, suggesting DaBoyz will try to pop it through the resistance if there’s a flurry of market orders to begin the day. If They can’t goose the futures above that level (i.e., 914.00) in the early going, however, I doubt that they’ll be able to do so later in the day. That would leave stocks treading water and vulnerable to a selloff ahead of the weekend.
The bearish pattern shown in the chart projects to 112^09, an implied disaster that would send yields soaring well above the levels that triggered scare headlines earlier in the week. For its part, Wall Street seemed not the least bit scared, since the broad averages have remained mixed. But if June Bonds are about to plummet to our target, that could put an end to the complacency that has contributed to, among other things, the powerful short-squeeze rally in bank stocks.
A 150.72 rally target broached here earlier is still viable and will give us a logical place to try and get short. Accordingly, if and when the stock gets within 5-10 cents of that target, buy two October 120 puts (GSVD). A price of around 5.60 would be pretty attractive, but you should base your bid on the bid reflected by market makers if and when the target is closely approached.
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INTRADAY TRADING NOTES for Friday
The Dollar Index has cracked a key support that should not have given way so easily. I will comment on this at greater length over the weekend, but suffice it to say, this is bullish for precious metals and beraish for much else. Hidden Pivots aside, a test of December's 77.69 low in the NYBOT Dollar Index (DXY) appears likely.
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Rick’s Picks Weekend Edition
by Stephanie DeMaria on May 30, 2009 12:01 am GMT
America Honors Its War Veterans
America paid tribute to its war veterans over the weekend with ceremonies, concerts and solemn gatherings across the nation. Washington D.C. was the scene of a particularly stirring tribute, the twentieth annual PBS National Memorial Day Concert held outside the Capitol rotunda. Many in the audience were moved to tears by the incredible story of one veteran, Jose Pequeño, a New Hampshire National Guardsman and former Marine »
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Street Celebrates More Bad News
The stock market further distanced itself from reality yesterday as the Dow Average tacked on another 200 points to its nearly 2,000-point gain since early March. It’s hard to say what caused this latest outburst of irrational exuberance. It may have been the news that North Korea had thumbed its nose at the world by testing A-bombs underground. That story dominated the headlines over the holiday weekend and was said to have been the cause of global “concerns.” Lately, though, such concerns have been the bread and butter of Wall Street pros who go bargain-hunting every time stocks sell off. For them, it’s not a case of »
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If Dollar Is Bottoming, Killer Deflation Is Next
Has the dollar put in an important low? It looks like it, since the NYBOT Dollar Index widened the gap on Wednesday between it and a key Hidden Pivot support at 80.04 that we drum-rolled here earlier. We had been using that number as a downside target since late April, when DXY was trading just above 84; it was first touched last Friday, then exceeded by a scant 0.23 points before bouncing back. Now, if the dollar is indeed embarking on a major rally in line with our forecast, stocks are likely to fall, and gold and other precious metals to come under pressure, for the foreseeable future. These new trends may have begun to emerge yesterday, since the Dow Industrials fell 173 points and Comex June »
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Bullion’s Rally Fills Our Sails
Firming quotes for gold and silver in recent days have filled our sails, allowing us to spread off the risk in bullish options positions we hold in two issues popular with Rick’s Picks subscribers – Silver Wheaton (SLW) and the Gold Miners ETF (GDX). A while back, we bought calls in both with the intention of later shorting options of an earlier expiration against them. However, with precious metal prices relatively flat for a spell, there were no »
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