Member-only content. Please Login or get a free trial of Rick's Picks to view.
COMMENTARY for Friday
TODAY'S ACTION for Friday
Rick's Picks for Friday
We’ll need to see how things unfold over the next few days to determine whether there’s another shoe to drop. In the meantime, take a mental snapshot of the hypothetical price action I’ve sketched on the hourly chart, since it imagines a couple of Hidden Pivot midpoints that might form roughly as shown. There are no high-confidence targets for today, just a 10633 midpoint resistance from the one-minute chart that lies slightly above yesterday’s recovery high.
The Hidden Pivot rally targets furnished here yesterday provided useful benchmarks to gauge the strength of the uptrend, since each in its turn very precisely defined a minor-cycle peak. The highest of those targets, 1208.90, was eventually exceeded by $3 — enough for us to infer that buyers will continue to dominate in the days ahead. If so, look for the next thrust to carry to as high as 1224.70. That target would be corroborated by a pullback to around 1190.40, its sibling midpoint. You can try bottom-fishing there with a stop-loss as tight as 1189.90, but the officially approved tactic would be to initiate at ‘X’ of the first uptrending ABC pattern on the lesser charts (i.e., via camouflage). If this occurs during regular hours, I will be in the chat room to guide you.
There was grumbling in the chat room yesterday because of Silver’s disappointing performance relative to Gold, but no one should doubt that the former remains in a bull market, even if one that is sometimes manipulated against all logic. If it’s any consolation, JP Morgan and the usual bunch of dirtbags failed miserably to push the future down, even, to the midpoint support of an in-your-face downtrend on the hourly chart. That would be at 16.870, but we shouldn’t sweat it, since it will take only a rally exceeding 17.895 to put bulls solidly in charge once again.
We hold 800 shares with an adjusted cost basis of 11.75 against eight May 18 calls shorted for 0.64. We”ll let the options ride for now, since their volatility has exploded with the wild moves lately in the underlying stock. The May 18 calls are currently trading for around 1.06, but if their implied volatility were lowered to what it was just two weeks ago, the calls would be hovering around 0.77.
The 85.67 rally target given here yesterday was about as high as the intraday charts can take us, and it is all but guaranteed to show some stopping power if and when DXY gets there. However, the trend could fail anywhere beneath it — meaning that yesterday’s 85.27 high could prove to be an important top. We should nonetheless remain open to the possibility that a 92.48 target on the weekly chart will eventually be realized. This looks like a longshot to me at this point, but the odds would shorten somewhat if 86.87 should be exceeded without the occurrence of a b-c pullback.
Member-only content. Please Login or get a free trial of Rick's Picks to view.
Member-only content. Please Login or get a free trial of Rick's Picks to view.
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.
Panic Subsides, But for How Long?
by Rick Ackerman on May 7, 2010 12:30 am GMT · 22 comments
The panic we’ve all been waiting for hit like a tsunami yesterday, sending the Dow Industrials into a thousand-point dive, 700 of it occurring in under ten minutes. We’d warned of this just a few days ago when we wrote that the market was “vulnerable to a sudden, even spectacular, selloff.” Yesterday’s selling was indeed so ferocious that it might have gone on for another thousand points if not for Mr. Market’s addiction to round numbers. With the Dow down almost exactly a thousand points, the broad averages turned from their lows like a cattle stampede encountering a wall of fire. We should consider it a warm-up for the real panic that surely lies ahead. Thursday’s hysteria will be just a sound » Read the full article