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COMMENTARY for Wednesday
TODAY'S ACTION for Wednesday
Rick's Picks for Wednesday
As of around 10:35 p.m., the futures were showing little of the feistiness that propelled them so vigorously from Tuesday’s lows; however, neither were they backing off in repentance of the rally. Once they get second wind, we should look for the push to 1008.00 at a minimum, or 1014.90 if any higher. For night owls looking to get on board, there wasn’t much in the way of handholds. I’ve included a chart that shows a possible one, although sellers are showing some reluctance at the moment to complete the abcd correction in the way we might wish. A pattern of equal subtlety is what you’ll need to get long with relatively little risk.
The rally pattern shown in the chart projects to 966.25 although I wouldn’t bet the ranch on it. That’s because the point ‘B’ of the pattern is pure sausage, having failed to surpass anything to the left of it. Still, our target will do just fine for a minimum upside projection in the midst of a runaway buying binge. Night owls looking for a stealth buying opportunity will need to get down on the 1-minute chart to find a savory allotment. As of around 11 p.m., there was a downside target at 937.00 (a=945.50 at 3:56 p.m. EDT), but it looked ugly even by my taste, and it also lay within a tick of the day’s key low.
We don’t have to chase the July 12.50 calls, since the position we have on already — long four September 10-June 10 calendar spreads for a 0.10 CREDIT — is all but certain to produce a profit if planet Earth survives till June expiration. However, just to fatten our odds, I’ll recommend bidding 0.30 for four July 12.50 calls today and leaving the bid in for the entire session. Concerning the stock, yesterday’s tedious dither looked like consolidation for a push to 11.08 the nearest Hidden Pivot above — a minor one to be sure. ______ UPDATE: We bought four July 12.5 calls @ 0.30. Sit tight for now. If you play with the numbers, you’ll see that nickels and dimes lost on the July calls if SLW slips back toward the $10 strike would be recouped tenfold via a gain in the value of our calender spread. Eventually, we’ll want to short four June 12.50 calls for 0,20 or more to complete the hedge and further fatten our potential profit.
Bulls looked powerless yesterday to reverse a downtrend that has been alleviated only by short covering for a day-and-a-half earlier in the week. The futures would need to push above 118^16 by week’s end to suggest the Plunge Protection Team is doing its job, but otherwise they’ll have their hands full just trying to keep this barge afloat.
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Take any dozen good reasons for being bearish right now and they still don’t equal the bullishness of the chart shown. The undeniably compelling rally objective is 13085, a 4.8% move from current levels, and one can only surmise that the dusting the 12158 midpoint received on the last pullback (12/28) all but clinched a finishing stroke to the higher number. Moreover, it implies that bears shouldn’t get their hopes too high even if, in the next few days, the Dow plummets 324 points to retest the midpoint support. As of now, that would signal not weakness, but a screaming opportunity to get long. Hard to believe, really, but that’s what the charts say.
INTRADAY TRADING NOTES for Wednesday
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‘Stink Bid’ Nails Low in Comex Gold
by Rick Ackerman on June 3, 2009 2:17 am GMT · 6 comments
Will investors have one more chance to buy gold for the relative bargain price of $900 before it takes off? We’ll get to that in a moment, but let me mention first that loading up on gold when bullion is moving higher needn’t be painful and fraught with risk. Consider the following futures recommendation that went out to Rick’s Picks subscribers early Monday evening. It missed the overnight low by just 10 cents, allowing traders to buy a single tick off the bottom. Here’s the recommendation exactly as it was disseminated at 8:01 p.m. EDT: “The futures sold off hard after making their high early in the day – but then, when haven’t they done so? The important thing is that buyers had no trouble pushing the August contract past a Hidden Pivot resistance at 985.80 noted here earlier. Night owls should » Read the full article