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COMMENTARY for Thursday
TODAY'S ACTION for Thursday
Rick's Picks for Thursday
The 1170.25 rally target that we’ve been using is obviously still on this vehicle’s reptilian brain, and now it has been surpassed by 1.00 point. That’s not quite enough to get it by the 1173.25 benchmark we set yesterday, but if it happens this morning it would create a bullish impulse leg on the hourly chart that we could not ignore. However, lest we be bamboozled by a head-fake, let’s ratchet the bar up slightly to 1175.25, which takes into account the 1175.00 peak-let show in the chart. A point ’B' high that forms between those two numbers would offer great camouflage and the possibility of a trade like the one I’ve sketched. On any kind of rally, my minimum upside target will be 1181.00. _______ UPDATE (1:17 p.m. EDT): Our look-to-the-left peak at 1175.00 did its job beautifully, since we were not fooled when this sneaky little sonofabitch tiptoed up to exactly 1174.75 before going into a 13-point selloff. The analysis remains valid, as does the crucial importance of 1175.00 to the short-term picture.
Buyers took out the 1243.10 rally target without much effort, implying they’ll soon be back for more. Potential over the near tern — in this case, meaning the next 3-5 days — is 1286.30, a Hidden Pivot resistance that comes from the daily chart. More immediately, the futures appeared to be struggling to reach a 1230.70 retracement target after having penetrated its midpoint sibling 1236.00. You can bottom-fish with a 1230.30 stop-loss if the opportunity should arise. ______ UPDATE (1:28 a.m. EDT): The futures have exceeded the minor support at 1230.70 and now look bound for a somewhat more important one at 1226.80 (5m chart, A=1249.10 on May 12). Since they are rallying from 1227.50, however, we may have seen the lows for this correction. A bullish turnaround would be corroborated by a print at 1235.40, which would create a bullish impulse leg on the five-minute chart.
A rally target at 19.825 remains our minimum upside objective for now, since yesterday’s rally fell nine cents shy. The target is a Hidden Pivot that I expect to show some stopping power, but if it’s breached by more than three or four ticks, look for more upside over the near term to at least 20.32. You should also keep in mind a major target at 21.53 that we’ve been using for a while. Shortly before 3 a.m. EDT, easy opportunities for night owls looked limited. ______ UPDATE (1:31 p.m. EDT): The futures popped overnight to 19.845, exceeding our minimum upside target by two cents. This has bullish implications going forward, but they have been sidetracked by a savage, 50-cent drop from the highs.
We hold 800 shares with an adjusted cost basis of 11.75 against eight May 18 calls shorted for 0.64. Let’s bid 1.84 today to try to get the calls back. Pivoteers please note that I am using an abc-pattern “inverse” variation to project a low on the calls.
Newmont looks bound for a minimum 60.72 over the near term, but any higher would indicate 62.48. That’s a smidgen shy of the watershed high recorded at 62.72 early in 2006, but a breach of the pivot would imply that the peak is likely to be exceeded. Above it we could use a 71.14 target from the weekly chart to guide us.
A Hidden Pivot at 1534.30 flagged here earlier is pulling the futures lower, along with a secondary target (shown) at 1532.70. Camouflage is called for if bottom-fishing, so start looking for the turn on the 5-minute (or less) chart from 1535.80 on down. If these supports give way easily and, heaven forbid, the futures close below them, the next stop would likely be 1500.00, the ‘D’ target of the large pattern shown. Night owls could also use a 1520.30 target to bottom-fish — without camouflage. A four-tick stop-loss should suffice. Want to learn how to do this stuff yourself? Click here for information about the upcoming Hidden Pivot Webinar on June 6-7.
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There are numerous bearish patterns we can use to project a potentially important low, but the one that I like most has three single-bar coordinates, all sharply etched. They produce a 358.38 ‘D’ target, and although I cannot guarantee that will be where the carnage ends, it would most surely be worth bottom-fishing with a tight stop-loss. My best-case scenario implies that the low was made yesterday at 390.63, just 0.59 points from the ‘D’ target shown in lavender. To take the offensive, bulls would need to push this vehicle to 422.47 by Thursday.
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This Just In... for Thursday
From Jonathan Auerbach of Auerbach & Grayson, here’s a timely treatise on the gold-to-suit ratio. Turns out an ounce of gold is buying more than a single, decent man’s suit these days. Click here for the analysis.
Hidden Pivot Webinar & Tutorials
The next Hidden Pivot Webinar will be held this June 6th - 7th. 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.
German Outrage Could Queer Deal
by Rick Ackerman on May 13, 2010 1:08 am GMT · 10 comments
The Dow Industrials tacked on another big gain yesterday, blithely ignoring a global thumbs-down on Euroland’s latest, trillion dollar bailout package. The blue chip average finished up 149 points on the day, even as rumors circulated that Germany was about to ditch the euro and resurrect the D-mark. Whether or not this is true – and we doubt that it is – it’s clear that the Germans are becoming increasingly angry about having to play rich uncle to their n’er-do-well neighbors. Outside of Germany there appears to be a growing consensus that any further attempts to rescue, just for starters, Greece will simply be throwing (relatively) good money after bad. This thought surfaced with unsurprising vehemence in the Rick’s Picks forum, where hard money rules, but it was surprising to see » Read the full article