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COMMENTARY for Thursday
PICK OF THE DAY for Thursday
Rick's Picks for Thursday
It’s been a few days since we checked in on our favorite bellwether, but Goldman has looked too punk this week to dragoon the broad averages into light-heartedness. The stock may have a chance to show its mettle today, however, since double support lies not far below in the form of a Hidden Pivot at 139.81 and a moderately important low recorded last Thursday at 139.29. Alternatively, I still like 151.24 as a minimum upside target for the near term, but if the stock doesn’t get there soon — say, within the next 3-4 days — that would be a quite bearish sign. More immediately, a print below the 139.29 low today would turn the hourly chart bearish.
Notice in the chart how all three of the Indoo’s vital ABC coordinates are single-bar affairs, albeit in a quite subtle fashion. The target of this visual confection is 9008.17, so let’s keep that Hidden Pivot firmly in mind as a minimum upside target for the Dow — not to mention, a potentially opportune spot to lay out some shorts. That is notwithstanding the ostensibly bearish planetary alignment mentioned in today’s commentary. (Actually, a Bradley date doesn’t preclude the possibility of an acceleration to the upside from here.) The target shown in the chart is so comeplling visually that I would be dumbfounded if it were not reached, and soon.
The Dollar Index narrowly missed creating a potent impulse leg on the hourly chart, although the rally did get past the two prior peaks we require at a minimum for a show of strength and/or a trend change. Since this could be the subtle beginning of a much more significant rally, we’ll continue to monitor DXY very closely. Those of you who trade currencies should of course follow this thread diligently.
From a Hidden Pivot standpoint, yesterday’s damage was muted because the dive did not exceed the look-to-the-left cluster of lows shown in the chart. My outlook for the (Wednesday) night session will therefore be cautiously bullish, although opportunities for night owls to get long appeared limited. Practically speaking, you’ll need to drill down to the one-minute chart before you can find any prior peaks that would be usable for a “point X entry” with-the-trend. The first that is as yet unused lies at 973.40, but by the time the futures get there, any camouflage would be compromised.
July Coffee’s run-up yesterday evinced the kind of power that is persuasive even on the one-minute chart. The rally could have called it quits below the 138.65, but it summoned that crucial extra ounce of gumption to take on the last impediment in its path. Now, assuming the end-of-day pullback low at 137.40 holds, we should expect a resurgence over the near term to as high as 140.75. Odds of that occurring would shorten if buyers easily surmount that 139.10 midpoint associated with the 140.75 Hidden Pivot.
Shortly before 3 a.m., a tediously mellow consolidation pattern looked capable of propelling the futures, currently trading around 932.25, all the way up to…939.50 (!) The Hidden Pivot midpoint lies at 934.50, a number that can be shorted with a three-tick stop-loss. Partial profit-taking (or implementation of a trailing stop if only a single contract is being traded) is advised if a pullback to 932.25 or lower ensues. The target itself should not be sorted because it is equal to a modest but not wholly insignificant peak made on the way down early in Wednesday’s session. Alternatively, the most promising spot for bottom-fishing would be at 925.25, the midpoint support of the pattern shown in the chart. That pattern is close to being compromised, however, with an upside breach of ‘C’. _______ UPDATE: The futures made a feeble, temporary top at 933.75 before retreating by 4 points. When they finally got past the 934.50 pivot, the rally again fell short of its target, touching 938.75. From there it was all downhill…uphill…downhill — i.e., a perfect day to go fishing.
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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 Thursday
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SIDE BETS for Thursday
Testing. Please ignore.
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Focus on Trivia Hints of Downturn
by Rick Ackerman on June 4, 2009 12:59 am GMT · 4 comments
Statistical trivia has been garnering more than its fair share of attention lately, suggesting that stocks may be ready to head lower for a while, if perhaps only out of boredom. Yesterday’s selloff, half of which was recouped in the final half-hour by a relatively docile short squeeze, was attributed to energy sector weakness. Specifically, there was word of rising oil inventories – a red herring that we stopped paying attention to long ago. Weren’t these inventories supposedly tightening just a day earlier, when crude » Read the full article