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COMMENTARY for Tuesday
TODAY'S ACTION for Tuesday
Rick's Picks for Tuesday
We don’t want to guffaw too raucously at yesterday’s rally, since it could it could clamp its nasty little fangs around our ankle on Tuesday before we’ve even had time to enjoy a rare moment of skepticism. But notice in the chart nearby how the rally did not lift the futures above a single prior peak on the hourly chart. True, it would have taken a pretty powerful move to do so — but that doesn’t mean we should lower the bar. Let’s set it at 1112.00 today to warn when buyers have turned serious, since a print at that price will have exceeded two “external” peaks and a third “along the wall” for good measure. Nimble practitioners of camouflage needn’t be so finicky, however: You can try getting long on a pullback from above 1093.75, the location of a (very) obscure peak on the three-minute chart (January 28, 9:45 a.m. EST).
I flagged a minor rally target at 1111.10 in the chat room yesterday afternoon, predicated on a push above its sibling midpoint, 1107.10. Well, the midpoint is toast, the futures having climbed as high as 1108.80, but buyers have since turned skittish. The pullback remains shallow so far nonetheless, and I would suggest that night owls loiter on the 1- and 3-minute charts to pick up on the kind of subtle ABC rally pattern with the potential to get one aboard without much risk. ______ UPDATE: This morning’s moderate rally exceeded the first peak mentioned in today’s commentary (1110.90) but not the second (1118.50). This is telling, as far as I’m concerned — indicative of buying that lacks the power and inspiration to see its way to new all-time highs soon. You might say that the Golden Groundhog has seen its shadow. _______ FURTHER UPDATE (12:01 p.m.): The second peak has now been exceeded, but it is a sign of this rally’s lack of confidence that the move to new recovery highs required a B-C pullback on the hourly chart. Now let’s see how the futures handle the next Hidden Pivot resistance at 1127.80, my minimum upside target for now. Traders should look for an entry opportunity on any pullback to 1113.60, the HP midpoint associated with 1127.80.
As noted near the bottom of today’s commentary, Comex Silver is lagging Gold badly and needs to pop today if it is not to become a serious drag on the latter. I’ve set the bar at 16.970,but keep in mind that once the rally exceeds the first of the two labeled peaks, it will need to climb above the second without a distinctive correction. Notice in the accompanying chart that camouflage would have worked to get long for the final hour or so of yesterday’s bull move. It will be tougher to find now, though, since any further progress to the upside is likely to produce an obvious breakout. Expert ‘camo’ play: On the 3-minute chart, check out the tiny gap between peaks at 16.740 and 16.755, respectively at 9:18 a.m. and 7:45 a.m. on January 28. A pullback from a top occurring between them could get you aboard ahead of a breakout.
Although yesterday’s high occurred just slightly above Friday’s, it surpassed a key peak at 79.51 recorded back in August. This refreshed the bullish trend on the daily chart, and also put DXY within easy striking distance of a second important peak at 79.66 made in July. It should not pose much of a challenge, since my minimum upside projection over the near term is 80.24 (with additional potential to 80.78 if the dollar closes above that number).
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This Just In... for Tuesday
My latest interview with Al Korelin of The Korelin Report concerned the inflation vs. deflation conundrum. Click here to access it.
Hidden Pivot Webinar & Tutorials
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Gold Takes a Leap, But Is There More?
by Rick Ackerman on February 2, 2010 1:05 am GMT · 8 comments
Gold had its best day in months yesterday, but how long will the animal spirits last? We may be better able to answer that question after we’ve seen how the April Comex contract interacts with two recent peaks located just above yesterday’s high. They are identified in the hourly chart below and lie, respectively, at 1110.90 and 1118.50. Notice in the meantime how the entire length of yesterday’s steeply vertical surge occurred without a visible pullback. This is a promising “impulse leg” indeed, and it would wax still more » Read the full article