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COMMENTARY for Friday
TODAY'S ACTION for Friday
Rick's Picks for Friday
Gold followed our script closely yesterday, peaking overnight a dime from a Hidden Pivot midpoint that had been flagged as a place to get short, then dropping to marquee support at 1100. The 1095.50 correction target is still valid in theory, but opportunity would favor bulls on a print exceeding 1114.10. The chart shows the importance of this number, and although a move above it would compromise any camouflage we might be looking for, the resulting ABC pattern could yield a very low-risk entry to those who are nimble enough to act on a fleeting B-C pullback. _______ UPDATE (10:04 a.m. EST): An entry opportunity precisely like the one shown opened up in the middle of the night. The futures popped to 1114.20, exceeding the look-to-the-left peak by a tick, then pulled back for 15 minutes to form a point ‘C’ low at 1112.70. Entry was at 1113.40 for an 1115.40 target, but you could have ridden a larger, bullish pattern to the eventual top near 1119.00. The futures dove thereafter, turning the rally into yet one more gratuitous hump. Gold’s next big move will be up, but it quite evidently isn’t ready to fly yet. The 1095.50 correction target is still valid, but there is now another at 1092.00 that corresponds to a Hidden Pivot midpoint at 1105.70 providing support at this moment.
Let’s plan on shorting 1159.25 with a two-point stop-loss. I don’t usually favor patterns so very elongated as the one shown in the chart, but the two rally legs are sufficiently similar in appearance to beckon a modest, $100 speculation. This being a Friday, and Mr Market being, always, a sonofabitch, we might expect the target to be hit in the final 90 seconds of the session. My advice is to take the trade anyway, provided you are able to monitor it, and to use the stop-loss, when index futures resume trading Sunday evening. _______ UPDATE (10:14 a.m. EST): The futures collapsed after spiking to 1159.50 on retail sales news. Our short offer could not have been more perfectly positioned, and in the chat room I advised taking profits on half the position with the futures trading about 12 points lower. Use an 1153.75 stop-loss until 1144.00 is reached, then switch to a 5-point trailing stop for half of what remains. For grand-slam potential, you should keep a vestigial piece of the original position with a stop-loss above 1159.75. Officially, we’ll retain a single contract on those terms.
Like so many other trading vehicles, including index futures and ETFs, April Crude has a compelling rally target that lies within an inch of mid-January’s highs. The precise number in this case, a Hidden Pivot at 84.74, would fail by a hair to surpass January’s 84.96 high. (The comparable target for the DJIA and the Diamonds, however, would slightly exceed the January high.) Clearly, this is a crucial juncture for many of the issues we trade and/or monitor. And while it is hard to imagine the targets will not be reached, it is by no means a foregone conclusion that they will be decisively exceeded. All in all, it is probably a good day to lie low and spectate for a change.
The Euro has been tracing out a bowl-shaped formation for more than a month, and it might now be poised to break out strongly to the upside. Important prior highs are within reach, and the next two of them will be surpassed if the Euro hits a D target of 1.3756 shown in the attached chart. Above that level is a cluster of prior highs ranging from 1.3789 to 1.3840. The 1.3756 pivot has high credibility due to a large bounce off of its exact sibling midpoint of 1.3688. A shallow pullback from the current level, perhaps to the 1.3688 midpoint area, would give rise to a camouflaged buying opportunity, as depicted in the chart. Traders looking to short the 1.3756 pivot should not enter orders before the prior high of 1.3737 has been surpassed, as this might release a burst of upside energy. For the same reason, traders with long positions should treat the 1.3756 pivot as a minimum upside objective and use trailing stops so as to remain long in case the market slices through the pivot. (Posted by Doug McLagan) _______ UPDATE (10:37 a.m. EST): The Euro slightly surpassed both of the two priors marked in the chart and then pulled back to one pip below the midpoint pivot. The ensuing rally indeed sliced through the D target and went as high as 1.3796, a move that was worth as much as $1,362 per contract. The prior high of 1.3789 was surpassed, giving the Euro chart an increasingly bullish look.
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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.
Hidden Pivot Webinar & Tutorials
The next Hidden Pivot Webinar will be held on Feb. 29th - Mar. 1st. 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.
Bogus U.S. Jobs Data Trips Up Colorado
by Rick Ackerman on March 12, 2010 1:07 am GMT · 15 comments
The brazenly bogus unemployment data disseminated to the news media each month by the U.S. Bureau of Labor Statistics appears to have tripped up Colorado. Although the state had reported a loss of 89,375 non-farm jobs in 2009, the actual number appears to have been much larger — 106,300, according to the latest revision. Colorado attributes the discrepancy to the Bureau’s rosy estimates of the number of businesses that start and fail each year. Until the new numbers came out earlier this week, Colorado’s official line was that it had somehow been spared the worst of Great Recession’s effects on the labor market. Unofficially, however, the picture was never so bright. “I was surprised when they reported the numbers the first time,” Zoltan Mak, a freight-train conductor on furlough » Read the full article