October 21st, 2014
Published Daily
HP Seminar Information page.

Bank Scare a Ruse to Shake the Tree

by Rick Ackerman on September 2, 2009 12:22 am GMT · 6 comments

A run on a major U.S. bank?  Who could have been spreading such scurrilous rumors? They surfaced yesterday in the Rick’s Picks chat room, and elsewhere, not long after we’d done some personal banking ourselves in an online account at the very same bank. We experienced no delays or problems with the transaction, notwithstanding reports of a “default situation” and “elevated” buying of put options on the shares of the bank.  We were able to confirm that there had indeed been a flurry of put-buying, but the action was not so frenetic as to suggest that the bank was in any serious trouble. 

bankers

To the contrary, banks are operating under such loosey-goosey rules right now that they shouldn’t have a care in the world. Imagine having a notarized letter from your local police chief authorizing you to loot and plunder any store in the neighborhood without fear of arrest. That’s how the banks are doing business these days – which is to say, however they want.  And if a deal should turn sour it’s no problem, since the U.S. government has assured banks that it will pay 100 cents on the dollar for any securities that ultimately fail to clear the market.

Smoldering Ruins

Tuesday’s rumors of a big bank on the ropes evidently were prompted by general weakness in banking shares. The selling had been attributed to nervousness over the prospect of more losses to come in the banking sector. A few analysts added to the stresses of the day by speaking cautiously about bank shares.  Has the spectacular rally begun last November finally run out of steam, they asked? We seriously doubt it. More likely is that those who have been accumulating bank shares hand-over-fist simply backed off their bids for a day, allowing the stocks to fall to more appealing levels.

Bloomberg, CNBC, the Wall Street Journal and all the rest bought into this ruse with a deluge of commentary concerning how financial stocks supposedly have gotten too far ahead of “fundamentals”. Fundamentals!?  If the day ever comes when fundamental analysis is applied rigorously to securities markets, the financial system will be reduced to a smoldering ruin in mere days. For the time being, though, the bankers are enjoying a holiday from scrutiny that makes all things possible. Under the circumstances, with Tammany Hall sensibilities determining the course of the financial system, we should not be looking for a top in banking shares, only an occasional pause in their upward spiral.

(If you’d like to have Rick’s Picks commentary delivered free each day to your e-mail box, click here.)


TODAY'S ACTION for Wednesday

Against the Grain…

by Rick Ackerman on September 2, 2009 1:18 am GMT

 Member-only content. Please Login or get a free trial of Rick's Picks to view.


Rick's Picks for Wednesday
$ = Actionable Advice + = Open Position
Hidden Pivot Calculator   Education Page
All Picks By Issue:

GCZ09 – Comex December Gold (Last:955.00)

by Rick Ackerman on September 2, 2009 12:44 am GMT

The futures spent the day struggling to go lower, failing in the end to overpower a midpoint support at 947.60 whose breach would have greased the skids down to 938.70. The bearish pattern is shown in the accompanying chart, and as you can see, the pre-dawn bounce came from a low that lay within a single tick of the pattern’s calculated midpoint. The reactive rally was no world-beater, to be sure, but on balance the picture is at least mildly bullish for the near term.  A 978.00 rally target given here earlier remains viable, but like you I am growing a bit impatient about it.

GS – Goldman Sachs (Last:162.03)

by Rick Ackerman on September 2, 2009 12:53 am GMT

Yesterday’s savaging did no damage whatsoever to the bullishness of the daily chart, although there is still room to fall on the lesser intraday charts. Specifically, a Hidden Pivot target at 158.90 looks like a good place to try bottom-fishing. Officially we’ll bid 158.93 for 200 shares, stop 158.79.  We continue to hold the Jan 130 – Oct 130 put spread four times for 3.40 and a September 170 call for 2.00. _______ UPDATE: The bottom-fishing gambit worked out nicely, since the stock rallied $1.08 after making a low at 158.90 around midway into the session. You would have needed to apply a trailing stop, though, since Goldman subsequently relapsed to 158.14 before the closing bell.

SIU09 – Comex December Silver (Last:14.970)

by Rick Ackerman on September 2, 2009 1:01 am GMT

Silver effected a promising spike yesterday afternoon, but the futures were struggling to hold onto the gain early in the evening.  If they go no lower than 14.940 overnight, however, any rally exceeding the relevant midpoint resistance at 15.155 would suggest additional upside potential over the near term to as high as 15.365.

DXY – NYBOT Dollar Index (Last:78.80)

by Rick Ackerman on September 2, 2009 1:12 am GMT

The rally looked altogether unimpressive until late in the session, when a fleeting spike surpassed a look-to-the-left peak at 78.91 that I’d flagged in the chat room. That gives the rally nominal appeal on the lesser charts, although we should require 79.79 today to validate it. The location of the obscure but important peak-let this would surpass is shown in the accompanying chart.

$JNK – High-Yield Bond ETF (Last:40.46)

by Rick Ackerman on October 21, 2014 9:42 am GMT

 Member-only content. Please Login or get a free trial of Rick's Picks to view.

$DIA – Dow Industrials ETF (Last:163.65)

by Rick Ackerman on October 21, 2014 3:24 am GMT

 Member-only content. Please Login or get a free trial of Rick's Picks to view.

$ESZ14 – Dec E-Mini S&P (Last:1897.50)

by Rick Ackerman on October 21, 2014 2:25 am GMT

The market has gone ornery and untradable on us, presumably because everyone and his mother is going at it with the same idea of getting short. Although yesterday’s forecast here got the trend right and even nailed the intraday high, 1902.50, to the exact tick, the prediction was valueless for trading purposes. That’s because the ratcheting, exceedingly tedious rally generated a string of minor corrections that were equal to or greater than each subsequent leg up. Not exactly the risk:reward proposition we are looking for.  I proffered a still higher target at 1911.00 if 1902.50 was exceeded, which it has been in after-hours trading.  Night owls can use their own judgment to determine how to catch the implied ride north, but I wouldn’t look for easy pickings if there’s still a few points left in the move at Tuesday’s opening bell.

$GCZ14 – December Gold (Last:1236.60)

by Rick Ackerman on October 20, 2014 12:47 am GMT

 Member-only content. Please Login or get a free trial of Rick's Picks to view.

$CLX14 – November Crude (Last:83.00)

by Rick Ackerman on October 17, 2014 1:15 am GMT

 Member-only content. Please Login or get a free trial of Rick's Picks to view.

$TLT – Lehman Bond ETF (Last:122.01)

by Rick Ackerman on October 17, 2014 12:01 am GMT

 Member-only content. Please Login or get a free trial of Rick's Picks to view.

$USZ14 – December T-Bonds (Last:143^08)

by Rick Ackerman on October 16, 2014 6:43 am GMT

 Member-only content. Please Login or get a free trial of Rick's Picks to view.

$HGZ14 – December Copper (Last:3.0100)

by Rick Ackerman on October 6, 2014 9:30 am GMT

 Member-only content. Please Login or get a free trial of Rick's Picks to view.

$SNIPF – Snipp Interactive (Last:0.3400)

by Rick Ackerman on September 5, 2014 3:05 am GMT

I first touted Snipp Interactive back in January, when it was trading around 0.15. Although the stock subsequently fell to a dime, it has since rallied sharply, settling at 0.2562 yesterday. This is one of my favorite stocks, and I came away from a conference call with its CEO, Atul Sabharwal, eager to sing their praises. During that call, I hit Atul with my best idea, a sweepstakes-type promotion, but he was already three steps ahead of me, able to cite, for one, New York State’s rules and costs for exactly the type of marketing scheme I’d suggested.

Full disclosure: I hold 100,000 shares plus warrants to purchase another 50,000 shares.  But I hope that won’t discourage you from performing your own due diligence, since you are likely to be as impressed as I was when you find out what the company has been up to. For me, at least, Snipp (OTC: SNIPF) perfectly satisfies Peter Lynch’s rule that investors favor companies whose strengths and methods they can understand. Snipp does interactive marketing that allows clients to track results in real time. The results have been sufficiently impressive that the company has been attracting blue chip clients with little difficulty. Read more about SNIPP by clicking here.

From a technical standpoint, although the stock’s chart history is thin, it’s possible to project a near-term rally target of 0.2730. A tenet of Hidden Pivot analysis is that an easy move through such targeted resistance implies there is unspent buying power percolating beneath the surface. This is not a “hot tip;” indeed, Snipp’s story does not lend itself to the kind of hubris that will result in a $10 billion IPO. But it is an aggressive and imaginative pioneer in a rapidly developing niche, and its CEO has the kind of imagination, intelligence and energy that inspires confidence. _______ UPDATE (Sep 22, 8:30 p.m.): The stock has continued to rally, and the closest Hidden Pivot target is now 0.2668.  If that Hidden Pivot is exceeded on a closing basis for two days, however, a target at 0.3474 would be in play. _______ UPDATE (Sep 23):  Snipp has entered the Brazilian market via an exclusive marketing contract with Petrobas. Click here for the news release. ______ UPDATE (Sep 23, 1:57 p.m. EDT):  The stock has gone bonkers today, up six cents to within less than a penny of the 0.3474 target projected two days ago. _______ UPDATE (October 12, 9:20 p.m.): The stock has come down hard after peaking three weeks ago at 0.34, but I view the move as a corrective opportunity to accumulate more shares.


SIDE BETS for Wednesday

ESU09 – September E-Mini S&P (Last: 996.00)

by Rick Ackerman on September 2, 2009 12:57 am GMT

Below 999.75, there were no more Hidden Pivot targets to project yesterday using the hourly chart. That is still the case, although we can use the breach of a look-to-the-left peak at 1009.50 to signal us when ES is turning around.


Hidden Pivot Webinar & Tutorials
The Hidden Pivot Webinar is one-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. The next Webinar will take place on October 16, 2014. For more information, or to register, click here.