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COMMENTARY for Wednesday
TODAY'S ACTION for Wednesday
Rick's Picks for Wednesday
Uncomfortable as I am seeing the stock market’s glass as half-full these days, it’s hard to fathom that the Dow was off by a mere hundred points yesterday. What with all the bad news, including horrific consumer confidence numbers, we might have looked for losses twice as large as those that occurred. And now, true to form, the mini-indexes are getting short-squeeze Tuesday night, albeit only mildly so far. There are two modest targets just above — at 1099.25 and 1102.50 — but if the second is brushed aside, that would hint of a rough opening hour on Wednesday for bears. If the futures fall, though, you should use the pattern in the chart to gauge the strength of the downtrend. A failure to bounce at the midpoint would be telegraphing more weakness over the near term. Please note that if the pattern plays out more or less as drawn, causing ‘P’ to occur, so to speak, in the middle of nowhere, you can try bottom-fishing with a stop-loss as tight as three ticks.
The Dow looks like it’s setting up for a second consecutive 100-point decline. I’ve sketched it out on the 15-minute chart, and you can assume that a precise bounce from the indicated midpoint would portend a follow-through precisely to the target once ‘p’ is breached. The pattern cannot be interpolated to trade the futures, however, since they were wafting blithely above point ‘C’ Tuesday night.
A minor midpoint support at 1101.30 looks usable for bottom-fishing with a stop-loss as tight as 1100.70, provided the point ‘C’ of the pattern, 1108.80, has not been exceeded to the upside first. A breach of the pivot would imply more short-term weakness to at least 1093.90. If you’re looking for a decisively bullish turn, set an alert today at 1125.90. _______ UPDATE: The futures sliced through both pivots enroute to a 1090.20 low intraday. An interim bounce from 1099.60 would have stopped out the long for a trading loss of $60 (or so).
Silver would be demonstrating subtle power if it were to pop slightly above the two peaks show. If it does and then pulls back even momentarily into a valid b-c, be ready to attempt a camouflage entry at the conventional point x. I’ve sketched this out so that pivoteeers know exactly what to look for. I’d encourage you to share this knowledge in the chat room if you’re on top of it. _______ UPDATE: Silver fell overnight, negating our trade before recovering into the close.
Goldman squandered an opportunity to turn vicious yesterday, lunging above two “internal” peaks on the hourly chart in the opening minutes of the session, then failing to go for the gusto by taking out the “external” peak that I’ve labeled on the chart. What this suggests is that the next rally cycle is doomed to fail. From a trading perspective the stock remains a long-term short, although the opportunity to do so does not appear to be perfectly ripe at the moment.
The Dollar Index topped a single tick above the 80.98 midpoint flagged in yesterday’s tout. If and when it gets by the resistance, look for a swift follow-through to exactly 81.87, the midpoint’s ‘D’ sibling.
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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.
Smackdown: Hubris vs. Economic Reality
by Rick Ackerman on February 24, 2010 5:07 am GMT · 12 comments
Consumer confidence plunged more than 10 points in February, even as it was reported that Wall Street bonuses rose 17% in 2009. If a seer had told us a year ago that the two stories would run side-by-side on the same day, we’d have predicted there’d be rioting in the streets. Instead, the streets were calm, at least as far as we could tell, and investors took the news in stride, sending the Dow down a measly 100 points. We can recall a time not long ago when the stock market might have shown more deference toward such grim economic news. No longer, apparently. What do consumers know, anyway? The mere fact of the Dow trading above 10,000 must mean U.S. households were just having a bad hair » Read the full article