A key rally target that has been four months in coming lies just above, at 361.53 If this number is achieved, slightly exceeding a very important peak at 359.79 recorded last September, that would be the most bullish price action we’ve seen on the daily chart since December. That is when HUI created the impulse leg for which 361.53 was to become the ‘D’ target. The target itself is both clear andcompelling, so any progress above it, especially on a closing basis, and most especially within a day or two of its first being achieved, would suggest that bulls are just starting to warm up.
From the monthly archives:
May 2009
Our bullish benchmark is still 935.90 a tick above an unimposing but nonetheless important peak that was created April 1 on the way down. However, if a test of resistance at $1000 lies shortly ahead for the bull cycle begun in mid-April, the futures should be able to do a bit better, surpassing a second “external” peak at 948.50 recorded on March 26. Both price points are shown in the accompanying chart
The minor downtrend from Friday’s high pointed as low as 864.75, but as of 1 a.m. EDT sellers had not even achieved the Hidden Pivot midpoint, 874.00 This hinted of a firm opening Monday morning even though the futures were trading below last week’s settlement price as the night wore on. In any event, bears would be wise to run for the hills if the futures pop above 897.00 today, since that would turn the hourly chart unambiguously bullish. A subtler bullish signal would occur on the 15-minute chart at 885.00.
Member-only content. Please Login or get a free trial of Rick's Picks to view.
The September 84-May 84 call spread that we are long could have been exited yesterday for as much as 4.60, yielding a theoretical gain of $310, since our adjusted cost basis on the four spreads was 3.82. (That includes a loss of about $150 on a September 76 that we also held.) If you still hold a partial position, exit at will today — presumably at a profit, since May time premium will be melting away to zero with each tick of the clock.
The 61.97 target flagged here earlier remains valid, but please note that the futures are pulling back from within 3o cents of a lesser rally target at 59.77 that was reached earlier in the week. The high has the potential to end Crude’s winning streak, but if it’s surpassed on a closing basis, consider a finishing stroke to 61.97 a done deal.
It would be hard to say whether the tepid rally of the last three weeks has been more aggravating for bulls or bears, but the former should continue to use 935.90 as a go-ahead signal, since that’s what it would take to turn the daily chart decisively bullish. The most immediate Hidden Pivot target, 936.60, would do the trick, but if the futures fall back for one last consolidation, look to buy around 921.50 with a tight stop-loss, since that’s the midpoint pivot associated with the target.
Shortly after midnight, there weren’t enough clues to try and second-guess Friday madness –only a minor downtrend with a flimsy-looking target at 886.00. Because it is derived from a pattern with a “sausage B,” I wouldn’t suggest that night owls go too far out on a limb to bottom-fish there. A slightly bigger picture with a bullish bias has a rally target at 906.50, provided its sibling midpoint, 897.50, can be brushed aside. Both numbers will remain valid as long as 888.50 is not exceeded to the downside first.
I’m in New York once again for the annual spring meeting of the CMRE, the Committee for Monetary Reform and Education. This group attracts men and women from the investment community who share your editor’s disdain for fiat money and other falsehoods promoted by Big Government. Here’s the line-up of speakers at tonight’s dinner, along with program notes on each:
James Grant, publisher of Grant’s Interest Rate Observer.. On the record for the importance of The Gold Standard, Grant suggests Mr. Bernanke be asked to explain how the central-banking » Read the full article
Gloomy Picture Perhaps Worse Than It Seems
by Rick Ackerman on May 18, 2009 4:31 am GMT · 9 comments
Gloomy forecasts have generally held sway at the Committee for Monetary Research and Education’s annual spring dinner, but this is the only time we can recall when there were no optimists on the dais bold enough to challenge a consensus now gloomier, probably, than at any time since the 1930s. Jim Grant’s off-the-cuff talk was about as sunny as the evening’s presentations got, and even he was unwilling to allow much more than a ray of hope that everything would somehow turn out all right. Bob Hoye, on the other hand, was » Read the full article