February 12th, 2012
Published Daily
COMMENTARY for Saturday

Rick’s Picks Weekend Edition

by Stephanie DeMaria on June 13, 2009 12:01 am GMT

Sellers Sabotage Gold’s Celebration

The guy in the picture spent the weekend shuffling around the pedestrian mall in Boulder, Colorado, but he should try hanging out in front of the COMEX in New York if he’s serious about buying gold and silver cheap.  It was there on Friday that bullion was not merely “unwanted,” but positively despised. Exchange traders couldn’t dump the stuff fast enough, judging from the way prices plummeted early in the session and barely bounced for the remainder of the day.  When the dust had settled, August Gold was sitting at 957.50, down 24.80. July Silver got hit nearly twice as hard in percentage terms, diving 64 cents, or 4 percent, to close at 15.25.

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Dark Signs in Dollar and Goldman Shares

The dollar extended its winning streak yesterday, rallying overnight to narrowly exceed the bullish benchmark we’d set for it just a day earlier. If the dollar is indeed reversing direction after three months of steady weakness, it could darken the economic picture. The reason is that it would put pressure on all who owe dollars, intensifying the effects of a global debt deflation that has been…

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TARP Windfall Lays an Egg

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…

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We’re With the Rabble on CEO Compensation

We side with the rabble rousers – Chris Dodd, Barney Frank, and all the other hard-core lefties in Congress — on the corporate pay issue. For every CEO who got an eight-figure bonus in recent years, we knew a dozen guys personally who could have gotten the job done for $250k and a health plan. Dick Grasso, the former head of the NYSE, was the last straw. After a four-year legal battle with Elliot Spitzer over his nearly $190 million compensation package, Grasso prevailed in the Appellate Court. “From the get-go, there was never…

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Gold Needs More Time to Dither

We’ve never been gung-ho about head-and-shoulder patterns, mainly because they seem to pop up everywhere you look for them. Even so, there’s something to be said for the elegant simplicity of the two head-and-shoulder formations show in the charts below. The top chart is a bearish pattern in Comex August Gold that has been gestating for nearly a month. Its mirror image, shown in the Dollar Index chart below it, is a bullish, reverse head-and-…

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TODAY'S ACTION for Friday

And Now, a $2 Window!

by Rick Ackerman on June 12, 2009 2:45 am GMT

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Rick's Picks for Friday
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A small pattern that developed during yesterday’s briefing turned out to have been the best entry opportunity of the day. The subsequent rally reversed early-morning damage, but without engendering a true impulse leg on the hourly chart.  In fact, we need to drop down to the five-minute bars to find a qualifier (see inset) — one with a ‘C’ low that is just a tick higher than ‘A’.  That’s enough to give us an uptrend to calculate, however, and a c-d midpoint at959.00 that so far has stymied the August contract’s recovery. If and when the futures get past it, we could expect the thrust to continue to at least 963.30.  However, if weakness prevails, a Hidden Pivot at 925.50 corroborates the head-and-shoulders implications noted in today’s commentary.

ESM09 – E-Mini S&P (Last:942.25)

by Rick Ackerman on June 12, 2009 2:05 am GMT

Hidden Pivot seminar grads should be feeling deja vu when they look at the choppy rally that has been taking the futures higher without yielding much in the way of trading opportunities.  The 985.30 rally target here was a “go” from 938.25, when a long entry was triggered according to our rules.  However,  the subsequent swings would have eroded the patience of even the most confident bulls, since risk:reward for a buy-and-hold position has been rendered increasingly unfavorable with each gratuitous swing.  Meanwhile, I wish that I could offer night owls a succulent morsel to tide things over, but the futures have been manipulated into an extremely narrow holding pattern that yields no handholds.

CLN09 – July Crude (Last:71.61)

by Rick Ackerman on June 12, 2009 2:21 am GMT

The 72.15 rally target proffered here yesterday would have worked for those who sought to get short, but only with diligence, since the futures’ first encounter with this Hidden Pivot resistance produced some heavy chop. Now our focus will shift to a higher target at 74.47 also given here earlier. I’m going to alter it slightly, to 74.39, and recommend that you short two pennies below that number, stop 74.64. You’ll be on your own thereafter, but you’d need a pullback to at least 73.64 to take partial profits or implement a trailing stop. _______ UPDATE: The most recent Thursday carried to 73.23, and although the 74.39 target above it is still valid in theory, it is no longer very compelling for trading purposes.

$SLW – Silver Wheaton (Last:35.93)

by Rick Ackerman on February 9, 2012 4:24 am GMT

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$GS – Goldman Sachs (Last:116.29)

by Rick Ackerman on February 8, 2012 3:36 am GMT

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Dow Industrial Average (DJIA) price chart with targetsTake 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 Friday

Pandemic Update from Erich

by Rick Ackerman on June 12, 2009 1:43 pm GMT

Now that a global pandemic has been officially declared by the World Health Organization, I know you are wondering how our birdf flu correspondent, Erich Simon, see it. Here’s his latest — as always, not for the squeamish:

It just keeps getting better, Rick, and anybody not moving aggressively to the short side is not seeing the picture.

Yes, the H1N1 virus is on a crash course with HP H5N1, a recipe for the end of civilization. But just now it was announced (out of the UK… a country obsessed with Pandemic realities and preparing now for “millions” of upcoming cases, making prophylactics like school closures a moot point), it was just announced that surprise, the H1N1 virus, which mixes readily with other viruses, is going to mix with SEASONAL INFLUENZA strains when the flu season opens in the autumn in the Northern Hemisphere, if not sooner down south. It is a near given.

And this presents an entirely new dimension to the scenario. Because the H1N1 virus is going to ‘re-assort’ with any of myriad seasonal strains, a large percentage of which will only serve to increase virulence and casualty count, not to mention the increased affinity for efficient transmission. In fact, the Brisbane strain… out of Australia, was included in last year’s emergency overhaul of seasonal flu vaccine because it is a particularly nasty bug capable of killing millions and millions if that one mates with the Phase 6 H1N1.

Mexico Just ‘First Wave’

And it only gets better still. On a lesser note, but itself a new revelation straight outta the mouth of Margaret Chan… what Mexico experienced here a coupla months ago was only The First Wave of the now official Pandemic of 2009. The preamble. According to her, The Second Wave is on its way and will be arriving shortly, and per my understanding of second waves in Pandemics, those are the ones that hit the hardest.

So The First Wave closed Mexico City and nearly closed the border. What’s the next wave gonna do…?

 The viral fireworks are only getting started across so many fronts now that the dominoes are gonna go tumbling in all directions with increased case fatality numbers already baked into the cake, replay of 1918 or not… with untold reassortment possibilities ranging from millions dead, reminiscent of the ‘57 and ‘68 Pandemics, to tens and tens of millions dead, reminiscent of the 1918 Pandemic… and right on up to the worst case… an H1N1-HP H5N1 combo, with numbers dead in the 99% category across regions of the planet.

Vaccine? Forget It

And the stock market is not going to crash…? How’s that gonna work, with more money printing? The printing presses are on respite as rates regurgitate from all the economic water boarding. And it won’t matter anyhow. When all the inflation cracks start seeing their friends dropping dead from who knows which strain of which recombinant… forget the vaccine, there won’t be enough working labs to test all of the dead people to even begin to assemble the seed antigen needed to get any vaccines into production…, but there certainly won’t be anyone going in to man the presses. At least not any of THEM.

No, the Wall Street and Washington organized crime family will be running for their lives, throwing money outta their helicopters just to clear a path to escape.

Meanwhile, my Pharmacist sister with Express Scripts was just informed by her union that wages are being cut and jobs are being transferred to Chinese nationals working out of Ohio. More on that later. But the message seems to be ‘take the pay cut or get fired’.

So the band plays on…

E.


SIDE BETS for Friday

July Silver

by Rick Ackerman on June 12, 2009 2:26 am GMT

No evidence of a plunge in the offing, but were it to occur, a Hidden Pivot at 14.395 represents a great buying opportunity.  Alternatively, 15.910 is possible on a surge, subject to a possible stall at 15.605.

IBM

by Rick Ackerman on June 12, 2009 2:30 am GMT

Yesterday’s high looked like a short, since it occurred a hair above a 110.14 pivot. Suggest a July 100 put for 1.00 if you don’t want to spectate.

Goldman Sachs

by Rick Ackerman on June 12, 2009 2:32 am GMT

Thge 151.24 target still looks like a show-stopper.  Second-wind target: 155.04.

July Copper

by Rick Ackerman on June 12, 2009 2:35 am GMT

Don’t pass up an opportunity to short this pup at 2.4735 if it gets there today.

Google

by Rick Ackerman on June 12, 2009 2:38 am GMT

Could all of the selling be due to some flatulent antitrust probe of Google’s virtual library?  Relief may be on the way in the form of a Hidden Pivot support at 424.55.


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