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COMMENTARY for Wednesday
TODAY'S ACTION for Wednesday
Rick's Picks for Wednesday
On the June T-Bond’s daily chart, the clean lines of the downtrend strongly imply another leg down before sellers might conceivably be washed out. To be precise, the unachieved target lies at 112^09, a quite nasty fall from yesterday’s settlement price of 115^02. The bearish outlook is corroborated by the ease with which sellers punched through the midpoint sibling of the target, 118^00. Another negative is that downside targets derived from two lower point ‘A’ alternatives — labeled A1 and A2 here — have already been exceeded. We’ll want to attempt bottom-fishing if and when the target is approached, but that looks like it could still be a week or two away. We should also leave room for a surprise in the form of a bullish reversal. However, it would take a print at 116^24 to signal that today. _______ UPDATE: During this morning’s briefing, I provided targets for the September contract. A Hidden Pivot at 110^07 is equivalent to 112^09, but there is another at 111^07 that warrants scrutiny, since it could engender an important turn. The latter number is my minimum downside projection, and my confidence is high that it will be reached or exceeded before Bonds can turn around. Both targets can be bottom-fished with a stop-loss as tight as 4 ticks.
Yesterday’s dirge left a soggy mess on the intraday charts — a would-be predictable event for today that is not worth predicting. Scale up to the 180-minute bars, though, and it looks – still – like consolidation for a push into the 980s, at least. If so, I can’t say when all the excitement is likely to begin. However, as you can see in the accompanying chart, a thrust today exceeding 947.00 would be fresh meat for traders made hungry by the emptiness of Tuesday’s action. Not camouflage, for sure, but perhaps we’ll be able to get a handhold nonetheless. Stay tuned.
By failing to take out anyinteresting peaks on the intraday charts, yesterday’s quasi-rally left bulls something to shoot at today: i.e., two peaks — an internal and an external — that need only be surpassed to generate some heat on the lesser charts. I won’t hazard a prediction as to whether this will occur — my bias is somewhat bullish — but if not, it would leave the August contract vulnerable to a fall to as low as 942.30, a somewhat obscure Hidden Pivot that comes from the 15-minute chart (A=966.00).
The 74.47 target given here earlier remains valid, but a lesser one at 72.15 looks too pretty not to mention (see chart). That’s a Hidden Pivot, and it can be shorted with a stop loss as tight as 27 cents. If the stop is hit, however, it would be strong evidence that the higher target is likely to be reached. ______ UPDATE (10:06 a.m. EDT): Shorts from 72.15 would have been profitable but stressful, since the futures this morning have been playing toe-sies with the target after having dropped initiallly from 72.17 to 71.44. The pullback should have triggered partial profit-taking on a multilot position, or a trailing stop if you shorted one contract. Crude is clearly struggling to get past the pivot, and my gut feeling is that it will succeed. If so, we’ll have another target to short, and profits to cushion the stop-loss, at 74.47.
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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.
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TARP Windfall Lays an Egg
by Rick Ackerman on June 10, 2009 12:56 am GMT · 2 comments
The jury is still out on our favorite stock market bellwether, Goldman Sachs, since the shares of the well-connected banking firm failed yesterday to push above an important Hidden Pivot resistance at 151.24. Although the stock popped just high enough to stop us out of a profitable short position held from within a penny of the recent top, the rally fizzled after a head-fake on the opening. Goldman ended the day up just 56 cents, performing in-line with a generally turgid market. Yesterday we said Goldman could cruise all the way » Read the full article