Thursday, April 1, 2010

After impulsing down powerfully last week, the Ten-Year Notes have rebounded and look like a good short.  As discussed in the chat room on Wednesday, the hourly chart gives us a pattern whose midpoint and "D" target are potential short entry levels.  So long as the "C" point of 116^03 is not revisited, the associated midpoint of 116^15 or "D" target of 116^27 can be shorted with tight stops.  A move down to 115^28 would be impulsive on the 15-minute chart, and the daily pattern would be activated a few ticks below there.  Traders should proceed with caution at the time of the non-farm payrolls announcement on Friday morning.  (Posted by Doug McLagan)  _______ UPDATE (11:19 a.m. EST):  The futures headed lower without having gotten near our short offer. Cancel the order.

After failing to seize the opportunity last week, Goldman has receded back into doubt, perhaps dooming the broad averages to purgatory in the absence of bank-stock leadership.  The nearest downside target of consequence lies at 167.88.  That's a Hidden Pivot support, and although it's too close to a key low at 168.00 recorded on March 9 to be perfectly useful for bottom-fishing, we might nevertheless infer from its breach that the recent weakness in this once world-beating stock is likely to persist.

The trendline resistance we've been using as a reference point comes in at exactly 1121.00 today (or 1122.30, basis June)  , but if the futures exceed it by more than 3-4 ticks, look for the rally to continue to at least 1125.00 (June=1126.20), a Hidden Pivot  lifted from the 180-minute chart (where A=1090.80 on March 26).  Worst case if sellers romp:  1094.10 (1094.50, basis June), a hidden support that you could buy aggressively with a stop as tight as seven ticks. Entry should be attempted only if the opportunity occurs with at least 90 minutes left in the session.

A Hidden Pivot resistance at 11135 is equivalent to the 1197.50 rally target proffered in today's E-Mini S&P tout.  We can use it as a minimum upside projection for the near term, but please note as well that a print below 10765 would turn the hourly chat decisively bearish.

I've highlighted an 1197.50 rally target on the charts -- a Hidden Pivot that seems as right as rain to use for a minimum upside target.  If bears should be blessed with a second consecutive day of weakness, however, you can try bottom-fishing at 1158.25, stop 1156.75.  Bulls and bears alike should consider a print at 1171.25 the go-ahead for yet another preternatural upthrust.

We took the time to examine Apple’s charts closely, since a potentially tradable opportunity in the stock was featured in the day’s touts. As it happened, the trade triggered, albeit not in the way we’d expected. We also took a look at May Corn, which had just penetrated a key support. Although the breach was slight, it was deemed sufficient to imply that a breakdown as large as 20 percent lies ahead. Copper’s chart showed no such weakness, suggesting that it is mainly agricultural commodities that are headed for a fall.