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COMMENTARY for Monday
TODAY'S ACTION for Monday
Rick's Picks for Monday
My bias remains bullish, although it is clear that the futures are not capable of making any upside headway whatsoever without the crucial boost provided by short-covering. A thrust today touching 1113.00 would draw bears in once again, but DaBoyz left that drama for another day when they called it quits on Friday. They had already succeeded in creating a bullish impulse leg on the hourly chart the night before on thin volume, and this should set the stage for a further push today to at least 1107.50. That’s a midpoint resistance, and if it’s brushed aside we could expect a finishing stroke to at least 1118.50.
We hold seven April 42 puts for an average 1.05 and a March 44 put for 0.23. Buy 100 shares on the opening as an offset, since the short-term forecast is bullish. That will still leave us slightly short, since the puts have a delta value of about 18 apiece, but the backspread effect will make us net long quickly if the cubes rally, since the puts will shed deltas. Conversely, we would get short in a hurry if QQQ falls, since the puts will accrete deltas. ________ UPDATE (9:35 a.m. EST): We bought a round lot for 44.95 on a gap-up opening. The cubes have since traded as high as 45.13.
Silver looks well capable of dragging gold higher over the near term, since it did what gold failed to do on Friday, impaling several resistance peaks on the hourly chart without trepidation. Most immediately, the rally points to at least 16.695, subject to a test of support at 16.390, a midpoint resistance that is now support. Once the May futures have closed above 16.695, they’d become an even-odds bet to reach 16.985 with 4-6 days.
DXY could come down to 80.01, or perhaps to 79.88, and still be considered a bullish bet. That would fully correct the move off February 19’s top and leave the dollar recharged for a minor bull cycle to as high as 81.79. More bullish still would be a rally touching 80.82 without a dip first to either of the Hidden Pivots identified above.
Gold mildly disappointed on Friday, hesitating for six long hours before taking on a relatively minor resistance peak on the hourly chart. While the futures could have pushed past four such peaks by day’s end, they instead made gratuitous noise by flagellating beneath the remaining three the entire day. Buyers will have another chance to show their stuff today, and the most bullish outcome we might look for would be an unpaused thrust past the three numbered peaks shown in the chart. Please note in any case that bulls are in no imminent danger, since it would take a collapse to 1078.00 to turn the hourly chart bearish.
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Take any dozen good reasons for being bearish right now and they still don’t equal the bullishness of the chart shown. The undeniably compelling rally objective is 13085, a 4.8% move from current levels, and one can only surmise that the dusting the 12158 midpoint received on the last pullback (12/28) all but clinched a finishing stroke to the higher number. Moreover, it implies that bears shouldn’t get their hopes too high even if, in the next few days, the Dow plummets 324 points to retest the midpoint support. As of now, that would signal not weakness, but a screaming opportunity to get long. Hard to believe, really, but that’s what the charts say.
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Icahn versus Trump: Which Do You Favor?
by Rick Ackerman on March 1, 2010 12:01 am GMT · 7 comments
We never imagined we’d find ourselves rooting for Carl Icahn, the sleazy corporate raider, but then, we had not foreseen his taking on the even more unctuous and loathsome Donald Trump. The two have squared off in bankruptcy court in Camden, New Jersey, with Icahn seeking to wrest control of Trump Entertainment Resort, Inc., owner of three bankrupt Atlantic City casinos. If Icahn wins, he wants rights to the Trump name — but not for the reason you might think. Mainly, he’s trying to avoid the $20 million expense of changing the signs on Trump’s casino-hotels. For his part, Trump insists that his name » Read the full article