Dueling impulse legs on the intraday charts constitute a mixed signal that makes Silver look slightly more bullish than gold at the moment. We can use a Hidden Pivot at 16.800 as a minimum downside target for now while stipulating that it will take a pop today or tomorrow to at least 17.915 or better to turn the lesser charts unambiguously bullish.
From the monthly archives:
December 2009
I took my eye off the ball briefly when an abortive rally Wednesday night threatened to disrupt a promised pullback to at least 1090.20, but that’s still the number to watch. There’s another HP support near there, as well as the trendline support shown in the accompanying chart. A breach shouldn’t be viewed as fatal, and in fact we’ll be on the alert for signs of a devious breakdown, since nothing has changed to fundamentally undermine the bullish case for gold. Most immediately, the futures would need to pop to 1123.90 today to get back on a bullish track.
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Hidden Pivot obstacles loom at 77.42 and 77.53, and we should be able to tell how much more buying power is left to drive this rally once we’ve seen DXY interact with them. The latter number is doubly important, since it lies just above a key peak at 77.47 recorded on October 2. Looking at a much bigger picture on the weekly chart, the trend could continue to as high as 83.33 without affecting the likelihood that the uptrend since March 2008 has been just a garden-variety bear rally. _______ UPDATE (12:23 a.m.): DXY has blown the roof off resistance in night trading, taking out all three resistance points noted above. Since there has yet to be a pullback, the full power of the impulse leg begun from 74.27 on December 1 has yet to be revealed.
A Hidden Pivot just above, at 45.44, has the potential to be a bear-rally stopper. Accordingly, we’ll plan on getting short when the target is closely approached by buying four January 45 puts (QQQMS). They should be trading for around 0.90, but the best way to determine their fair price is to monitor the bid/asked spread when QQQQ gets within 20 or so cents of the target. I am not suggesting a stop-loss on this trade because it seems highly unlikely to me that the Cubes will simply blow past the target. Mark this order good-till-canceled.
The futures looked bound for at least 17.905 over the near term, but if they take out that Hidden Pivot without much effort, the rally could go to 18.040 or even 18.120. Some important peaks lie at 17.910 and 18.050, and shorts would be toast if they are exceeded by an unpaused thrust by tomorrow.
Wednesday’s wildly idiotic price action reminded us of the days when the bonds were wont to act as though they had to do “something” nutty every time the Fed came out with a “more-of-the-same” announcement. Yesterday brought more more-of-the-same “news” from the Fed, and gold traders went nuts for an hour before it dawned on them that the central bank’s plan to keep administered rates exactly where they are was not exactly earth-shaking news. Later in the day, around 7:40 p.m. EST, February Gold had recovered completely from its swoon and was poking above the spiky intraday high at 1142.50. A no-brainer target at 1147.30 can serve as a minimum upside objective for Wednesday night (see chart). That would get the futures past the first of three peaks immediately above, but at least one more peak would need to be smashed to imply that the correction is over. Above 1147.50, the next interesting pivot is 1155.00. ______ UPDATE (12:32 p.m. EST): The futures are down $10 from their highs in deference to tonight’s surge in the dollar. The pullback is not yet impulsive on the 15-minute chart, even, so you could say that Gold is holding up pretty well so far under the circumstances. The 1147.30 target that had looked so promising would be negated by a print below 1129.30, a mere dollar beneath tonight’s so-far low. FURTHER UPDATE (3:10 p.m. EST): The 1090.20 target I proffered here a while back is still the one to care about. I said I wouldn’t touch February Gold until it hit that price, but an 1102.30 Hidden Pivot support that I posted in the chat room was too tempting to pass up. I advised exiting this scalp-trade at 1106.50, but the rally carried an additional $4, to 1109.60, before gold resumed its familiar trajectory.
ow gold minimum , as I originally had thought.
With Time magazine’s momentous selection of Ben Bernanke as Person of the Year, there were reports of people dancing in the streets in, um, Oslo. Leave it to Time to figure out a way to make Henry Luce roll in his grave while the magazine tries to outdo rival Newsweek in the race to claim publishing’s trophy for irrelevance. While the understandably isolated delirium over Bernanke’s selection subsides, we thought we’d update the prospectus on gold with a contribution from a Rick’s Picks subscriber who has requested anonymity. His thoughts run counter to the popular notion that investors can count on steady buying from China to lend » Read the full article
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Healthcare Cliffhanger Is Great Entertainment
by Rick Ackerman on December 18, 2009 3:23 am GMT · 24 comments
The healthcare circus on Capitol Hill continues to amuse, delight and entertain as Republicans maneuver to delay the alleged “reform” in every possible way. Pelosi thinks the GOP’s “mischaracterization” of the legislative package is what has been obstructing its passage. In fact, were it not overwhelmingly obvious that a solid majority of Americans fear, despise and oppose this legislative turd, the Senate’s 39 Republicans wouldn’t have had a prayer of stalling it for an hour, let alone for days or weeks. Now it now looks as » Read the full article