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COMMENTARY for Tuesday
TODAY'S ACTION for Tuesday
Rick's Picks for Tuesday
The futures were falling Monday night as trading resumed following the long holiday weekend. The E-Mini S&Ps have been as low 1081.25, down ten points, but that is still somewhat shy of a minor Hidden Pivot support at 1076.00 that we’ll use as a minimum downside objective for now. Night owls can try bottom-fishing using a 1076.25 bid and a three-tick stop-loss, but it’s probably not worth much more than that, since traders could be in a surly mood due to the mostly unsettling news over the weekend. _______ UPDATE: We were stopped out for small change when the futures came down to 1069.00 overnight. Schizophrenic behavior colored the remainder of the day, with a rally in the first hour to 1094.50, then a 20-point selloff into the close that left the futures down around 15 points on the day.
As of around 9:45 p.m. EDT, the futures were predicting the Dow would hold above 10000 in the face of moderate selling. The minimum downside target is 10024, but if that Hidden Pivot support should be violated by more than 5-7 points, it could open the floodgates over the near term down to as low as 9599. The accompanying chart shows the provenance of the 10024 target — a bearish pattern identical to the one being traced out at this moment by the E-Mini S&Ps.
The futures look finally to be leaving the 1214.90 midpoint resistance behind, presaging a run-up to as high as 1261.80 over the next 3-5 days. More immediately, they are tracking a minor bullish pattern that points with some clarity to 1236.20. If it’s breached by more than $1 or so, we should infer that a test of mid-May’s 1251.40 high is imminent. Night owls can try buying on a pullback to 1220.00, the midpoint associated with the 1236.20 target, but I’d suggest using camouflage if available to limit the entry risk to four ticks or less. ______ UPDATE: The futures dipped as low as 1218.20 overnight, so any attempt to buy down near 1220.00 with an ultratight stop-loss would have been stopped out for a small loss.
A fairly important Hidden Pivot resistance at 20.170 remains our minimum upside target for the moment, but an 18.795 midpoint resistance will need to be overcome first. Sunday night price action was too choppy for an easy entry, but an impulsive thrust peaking between the two labeled highs could set up an excellent camouflage buying opportunity.
We hold 800 shares with an adjusted cost basis of 12.95. Our most recent covered write expired in May, but we’ll look to sell some more call premium against our stock if and when it pokes above $20. ____ UPDATE: The stock is trading above $20, but this seems like a good time to be a little greedy, so we’ll hold off on the covered write. My next rally target is 23.72, and that is where we’ll plan to lay out some call options.
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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.
This Just In... for Tuesday
Here is a link to video from my appearance on Max Keiser’s On The Edge, where we talked about market making, high frequency trading, flash crashes, deflation and hyperinflation.
Other recent media appearances by Rick Ackerman.
This weekend, I appeared on Al Korelin’s The Korelin Report, where we discussed the responsibility of government in the BP disaster.
The biggest slump in commodities since Lehman Brothers Holdings Inc. collapsed is undermining Wall Street forecasts for accelerating economic growth and higher prices for everything from copper to crude oil.
via Commodities’ Biggest Drop Since Lehman Bear Signal (Update2) – Bloomberg.com.
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.
Facebook Hottie Has a Dark Side
by Rick Ackerman on June 1, 2010 12:01 am GMT · 13 comments
Quite the hottie, isn’t she? That’s “Rita Wilson” pictured below, and we didn’t think twice about adding her as a Facebook friend when she sent us a request a while back. We figured we’d find out later who she was, but we were wrong. She doesn’t answer e-mail queries, and Googling the name brings up only the actress Rita Wilson who is married to Tom Hanks. This Rita Wilson’s Facebook biography says she lives in San Francisco. Because we lived there ourselves for more than 20 years, we thought that maybe there was a connection through some mutual friend or acquaintance. Alas, as far as we’ve been able to determine, Rita Wilson doesn’t exist in the flesh. Rather, she appears to have been concocted by some PR firm tasked with hyping the shares of » Read the full article