April 23rd, 2014
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Rick’s Picks Weekend Edition

by Rick Ackerman on September 26, 2009 12:01 am GMT

Two Exploration Stocks to Consider

[We often feature the work of our friend and colleague Chuck Cohen, a NYC-based investment consultant who specializes in mining companies. Below, he explains why it is time for those who have been straddling the fence to buy junior gold shares.  He concludes with two specific recommendations that trade over-the-counter for less than $1.]

Rick has asked me to write about gold with a focus on the junior mining companies, so here we go, along with a couple of specific recommendations. I tried to point out the pros and cons of buying the juniors last month, but let me now make a quick refresher. I also suggest that you go back to Rick’s August archives to review my articles on gold and the junior sector.

Advantages of juniors…

– They have been beaten down in price due to the credit squeeze last year….

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Tepid Media Make Gold an Enticing Buy

[Rick has been under the weather with a possible case of food poisoning. Filling in for him today is Chuck Cohen, a financial consultant whose work will be familiar to many of you. The following appeared at LeMetropole.com over the weekend. Chuck thinks that as long as the news media continue to stumble around in the dark in their coverage of the gold world, we should remain confident about accumulating more bullion and precious metal shares for the long haul. RA]

It took a mix of $1000 gold, the media’s reaction to it, and a very fallow day to compose this piece. As serious as the news is these days, it is still difficult not to see the absurdity in what is unfolding. Now that gold has finally pierced $1000, I had expected to find repentance and mea culpas by a news media that has persistently resisted and even mocked the gold bugs for nearly a decade. But if the news over the weekend is an indication, gold might…

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Of Green Shoots and Broken Windows

Our memory stumbles whenever we try to recall any recent sightings of “green shoots” that would support the officially promoted illusion of a U.S. economy in recovery.  Actually, this vision is more of a hallucination than an illusion, since one’s mind needs to venture beyond the pale of rationality, light years beyond the fringe of statistical evidence, to conjure up supposed signs of sustainable growth. Does “recovery” square with the reality that you, personally, see all around you?  Indeed, whatever picture the government and the news media want us to see will be unconvincing at best, since a…

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Will Gold Be the Turd in G-20’s Punchbowl?

With a glower of contempt toward the bankers, gold remains easily aloft above $1000, developing thrust for the next big move. We wrote here a while back that blast-off from $1000 would follow the realization that G-20 can do nothing to restore stability to the world’s tottering financial system. Now, the question is whether anything at all will be “realized” in the wake of the Pittsburgh meeting. We hesitate to call it a summit because the event seems to have slipped off the news media’s radar.  Unable to recall the actual…

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Panicky Gold Sellers Find Safety Aboard Titanic

It’s a crazy world that views dollars and Treasury paper, of all things, as a safe haven whenever the financial news turns unsettling.  Yesterday’s upsetting story had sales of existing homes falling by 2.7% last month, darkening the mirage of recovery in the housing sector. Home sales had risen over the four previous months, but the distress buying that was driving this statistic appears to be drying up. Skittish traders lost no time connecting the dots, dumping gold and piling into dollar assets.  They evidently had…

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TODAY'S ACTION for Monday

Holiday Schedule

by Rick Ackerman on September 28, 2009 12:01 am GMT

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Rick's Picks for Monday
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DXY – NYBOT Dollar Index (Last:76.68)

by Rick Ackerman on September 28, 2009 12:01 am GMT

The Dollar Index on Friday ended the day with a bounce from the exact midpoint support of the pattern shown in the chart. It would need to rally today to at least 76.94 to suggest bulls are back in charge. At that point they would be presumed capable of propelling DXY to as high as 77.47. Key resistance on the  way up would come at 76.98.

GCZ09 – Comex December Gold (Last:992.40)

by Rick Ackerman on September 28, 2009 12:01 am GMT

Gold’s two setbacks this year have averaged about 12%, which would imply a pullback to around $940. Would that be so bad? In any event, my worst-case correction target for the near term is 970.80, predicated on a breach of that Hidden Pivot support’s midpoint sibling at 985.60. Friday’s low exceeded the midpoint by just one tick, so we should view it as still intact. As always, interaction with these pivots will be the key to gauging the strength of the downtrend.  Alternatively, we should set the bar at 1001.70 to alert us to a decisive, bullish turn on the hourly chart.

AKAM – Akamai Technologies (Last:22.45)

by Rick Ackerman on September 28, 2009 12:01 am GMT

We hold 200 shares with an adjusted cost basis of 16.73. Shorting some option premium against them on the last run-up might have been warranted, but having missed the opportunity, we can take encouragement from the fact that Friday’s high slightly exceeded the look-to-the-left peak at 19.46 recorded on the way down a day earlier. _______ UDPATE (October 29, 10:12 a.m. EDT):  The stock has opened on a huge gap today.  Sell half the position (i.e., 100 shares) now, for around 22.45.  A sale at that price would give us an adjusted cost basis of 11.01 for the remaining round lot.

ESZ09 – E-Mini S&P (Last:1055.75)

by Rick Ackerman on September 28, 2009 12:01 am GMT

There are too many enticing downside targets at the moment to pick just one, but they’d all become moot if the futures were to reverse from the least important of them, 1038.25,  producing a bullish impulse leg on the lesser charts.  A tiny peak at 1049.75 will serve just fine to tell us when this may have occurred. ______ UPDATE (10:51 a.m.):  The futures picked an alternative pivot from which to bounce, and bounce they did. They’ve easily pushed past the l-t-l peak at 1049.75, threatening not only to ruin bears’ day, but their whole week.

SIZ09 – Comex December Silver (Last:16.370)

by Rick Ackerman on September 28, 2009 12:01 am GMT

The December contract will have a chance to turn from a minor midpoint support at 16.025, but if it doesn’t, look for the slide to continue to at least 15.795, a Hidden Pivot you can bottom-fish with a stop-loss as tight as three ticks.  Both of those numbers are tied to minor patterns, but a larger one hints of selling all the way down to 15.445 (subject to a possible bounce along the way from 15.930). _______ UPDATE: The futures bottomed at 15.760, three-and-a-half cents below our target and low enough to trigger the tight stop-loss advised.

$ESM14 – June E-Mini S&P (Last:1874.00)

by Rick Ackerman on April 23, 2014 3:24 am GMT

The leaps have been opportunistic, powered by short-covering whenever the mood is right. Most of the time these days, however, the futures are taking mincing steps in both directions, creating a challenging environment for profit-seekers in the middle hours of the day. One thing to notice, however, is that the rallies, particularly in this vehicle, and whether weak or powerful, seldom proceed from the first signaled entry point.  Instead, the ‘money trades’ launch from a second or third point-C lows of ABCD patterns, and they do it with such repetitious reliability that one can practically discard the first signaled entry opportunities routinely. This is the kind of price action we might expect when ‘everyone’ thinks that stocks will move higher on a given day. ‘Everyone’ can be right, but that doesn’t necessarily mean they can make money easily. For your interest today, I am including a chart that shows a modest rally target at 1895.00. I’m guessing it will be easier to get short there with a tight stop than to get long for the ride to it. However, because the futures will be in record territory at that point, we shouldn’t want to impede their progress too aggressively.

$PCLN – Priceline (Last:1230.18)

by Rick Ackerman on April 22, 2014 4:00 am GMT

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Since March 20, when GDXJ was trading for around $40, I have been looking for a potentially important low at 34.00.  More recently, I revised that target to exactly 33.76, a ‘Hidden Pivot support’. Yesterday it came within a single penny of nailing the exact low of a vicious swoon. The low may or may not prove to be the last gasp of a correction that has been in progress for the last five weeks, but it stood to be an opportune place to try bottom-fishing.  In that regard, quite a few subscribers reported getting aboard at or near the low, and so I’ve established a tracking position for their further guidance. It consists of 200 shares with a cost basis of 33.58. The price takes into account an initial purchase of 400 shares for 33.79, then the taking of a partial profit on half the position at 34.00.  The bounce so far has hit 34.90, meaning GDXJ has trampolined $1.14 cents since hitting my three-week-old target.  For now, traders should stop themselves out of the position if GDXJ breaches two prior lows on the 5-minute chart without an upward correction.  As of this moment, that would imply placing the stop at 34.37 (and remember: it must be exceeded by an unbroken, downtrending leg).  You should also offer a round lot (or half of the remaining position, whichever is greater) to close for 36.80, good-till-canceled. _______ UPDATE (11:38 p.m. ET): The herky-jerky spasms in the first 90 minutes altered our stop-loss so that it would have taken a 34.07 print to stop us out — 23 cents beneath the actual low. I’ll now suggest raising the bar by using an impulse leg-based stop-loss on the 30-minute chart. That would imply a fall today touching 34.29.  Please note, however, that the stop could change if zig-zag action early in the session creates any distinctive new lows on the intraday charts. Our target for the next profit-taking interval is still 36.80.

$DXY – NYBOT Dollar Index (Last:79.89)

by Rick Ackerman on April 21, 2014 5:25 am GMT

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$USM14 – June T-Bond (Last:134^01)

by Rick Ackerman on April 2, 2014 3:21 am GMT

We don’t pay much attention to this vehicle other than at key turning points, but the short-term pattern shown looks like a lay-up for traders who see futures contracts as no more than bouncing dots on a chart, waiting to be exploited. There are actually two trade possibilities here: 1) a ‘camouflage’ short as USM slips below the 132^13 midpoint; 2) and a very tightly stopped long from within a tick or two of the 131^17 target. Good luck!  Please report any fills in the chat room so that I can establish a tracking position for your further guidance. ______ UPDATE (3:17 p.m. ET): The short was tricky to initiate, but once aboard, your reward came quickly with a drop to a so-far low at  131^26. As noted above, the short should be covered and reversed near 131^17. ______ UPDATE (April 6, 3:57 p.m.): The low of Friday’s violent price swings was 131^21 — not quite close enough to have gotten you long easily. Although this could prove to be an important low for the short- to intermediate term, under the circumstances I’ll assume no subscribers were filled. _______ UPDATE (April 11, 1:03 a.m.): Next important stop on the way higher: 135^17. _______ UPDATE (April 20, 11:10 p.m. ET): Last week’s fleeting stab to 135^10 came within less than a quarter-point of my target — close enough for us to consider it fulfilled. It took the futures more than a month to get there, so we should expect this correction-or-worse to last for at least a week or so before bulls attempt to push T-Bonds to new recovery highs.


SIDE BETS for Monday

GS – Goldman Sachs (179.40)

by Rick Ackerman on September 28, 2009 12:01 am GMT

Goldman has taken a nasty dive from a peak that fell more than $4 shy of a potentially important rally target we were focused on. No one ever said it would be easy to short the little sonofabitch, but we’ll keep trying. Just so you know what the incentive is, if you’d bought some October 170 puts for 1.40 when the stock was topping last week, you could have cashed them out for as much as 3.55 on Friday, two days later.


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