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COMMENTARY for Wednesday
TODAY'S ACTION for Wednesday
Rick's Picks for Wednesday
Yesterday’s rally, tired as it was, surpassed our 1002.00 benchmark nonetheless, and with it an obscure November peak whose breach could refuel bulls for yet more weeks or even months. The 1008.25 rally target of two minor patterns is still valid, but it will be less enticing as a place to try shorting than if it had been hit the first time around. A 1009.25 stop-loss is advised once again, but don’t jump on this one if you are not confident that you can exit it nimbly if needed.
Gold extended a five-day rally to surpass a second peak on the daily chart. This is unmistakably bullish and makes a push to $1000 over the near term very likely, even if it’s not the rally that will take prices into the promised land. My gut feeling is that new peak exceeded yesterday – 968.90, recorded on June 10 — should have been breached a day earlier if this bull cycle were destined for greatness. In any event, a move up to at least 1016.60 now appears all but certain. The target is show in the accompanying chart, and, as always, if it’s easily exceeded we should infer that still higher prices are likely — in this case, a minimum 1074.50.
A Hidden Pivot resistance at 95.61 is equivalent to the target given for the cash Dow in today’s Side Bets. I’ll suggest buying two September 91 puts (DAVUM), good through Thursday, if and when the stock reaches the target. The options would be attractively priced at around 1.23 if you want to park a limit order with your broker, but be prepared in any case to stop yourself out if DIA trades above 95.80. I’ve included a snapshot of my option calculator, into which I’ve plugged a 23 volatility that I interpolated from Tradestation.
September Silver signaled significantly higher prices ahead by blowing through an important Hidden Pivot midpoint at 14.500 yesterday. This was the futures’ first encounter with this resistance in the context of the pattern shown in the chart, and it implies that the midpoint’s ‘D’ sibling at 16.565 will be reached.
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INTRADAY TRADING NOTES for Wednesday
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SIDE BETS for Wednesday
We’ve been using a Hidden Pivot at 9476 as a a minimum upside target, but another at 9527 now looks more compelling. See today’s DIA forecast if you’re looking for a relatively riskless place to try shorting.
The 76.59 target given here yesterday remains my minimum downside objective and a logical place for a corrective bounce to occur. However, if 77.86 is exceeded first on a rally, that would turn the short-term picture significantly brighter, warning shorts to get ‘em in.
Hidden Pivot Webinar & Tutorials
The next Hidden Pivot Webinar will be held on 6/30 - 7/1. This two-day event is designed to teach you the risk-averse trading strategies Rick has taken to his seminars around the world. Once you have learned his proprietary secrets, you will approach trading and investing with enough confidence to make your own decisions without having to rely on the advice of others. For more information, or to register, click here.
Are You Ready for the Gold Rush?
by Rick Ackerman on August 5, 2009 12:01 am GMT · 1 comment
(Following is the sixth in a series of article on gold by Chuck Cohen, a financial consultant and investor based in New York City.)
Last week, I explained why junior and exploration gold-mining stocks will be spectacular investments in the impending 21st Century gold rush. I will discuss specific stocks in the weeks ahead, but first let’s talk about how to accumulate them. Because juniors are quite different from other stocks, the best approach to building a portfolio is to stick with a game plan formulated in advance. For starters, you should look for stocks of companies that hold the most resources or have the greatest potential relative to their market capitalization. There are some companies that have a $10 million capitalization, with good results and the » Read the full article