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COMMENTARY for Tuesday
TODAY'S ACTION for Tuesday
Rick's Picks for Tuesday
Yesterday’s vaporous hoax-of-a-rally gathered irresistible force as such rallies nearly always do — on almost-nonexistent volume, in the dead of night. It took bears three hours to regain their footing after the ambush, but by day’s end they’d succeeded only in bringing the futures back to unchanged (or thereabouts). I continue to favor the short-side — fervently — since Mr. Market has been making it damned near impossible to get short. I’ve also got Steve Puetz’s cycle date in mind and mentioned it in the chat room. He notes that the eight biggest crashes in history have all occurred 3-6 days after a full moon that occurred within six weeks of a solar eclipse. That implies a June 20-29 window in this case — and hey, I’m not superstitious myself, but where’s the harm in laying in a small, speculative inventory of puts ahead of the weekend. In the meantime, I’m not going to suggest anything clever to get short today, since all it would have taken yesterday was to have laid ‘em out just beneath the in-your-face high at 1102.75 recorded on June 4. Sometimes being devious and diabolical requires only that Mr Market do the obvious. Yesterday’s little trick was right out of Poe’s “The Purloined Letter”.
Bears who are primed to panic on the next 100-point rally should take a look at the Dow’s weekly chart before they jump: heavy, heavy, heavy! It’s difficult to predict how high, or even whether, DaBoyz will be able to squeeze the blue chip average this week, but we’ll be watching vigilantly each day for opportunities to get short. Assuming yesterday’s low at 10186 is not taken out first, a midpoint resistance at 10286 shows promise. If it gives way, however, buyers would be telegraphing more upside to as high as 10387.
Crude has been rallying for the last week into the weight of a powerful downtrend that became manifest on the weekly chart in late May. The rally projects to 78.08, but we shouldn’t be surprised if it sputters out somewhere beneath that Hidden Pivot. I’d suggest trading it from the long side nonetheless, although the action was too squirrelly Monday to leave much in the way of handholds for night owls.
It’s been a while since we pondered this limping lump of brick dust, but it’s not a happy sign for bulls that the stock has slipped so easily beneath the Hidden Pivot support shown in the chart. What it suggests is that Goldman will fall anew, this time to Hidden Pivot support at 122.25. Camouflage shorts are encouraged from these levels, but if you’ve got the patience to wait, bottom-fishing at 122.25 could provide the kind of low-risk opportunity that we thrive on.
A 15-point rally today that touches 1237.00 is where the action would start to look encouraging for bulls. However, as noted in an earlier post, it will take a close above 1237.40 to set the futures on a course to at least 1258.60 – or perhaps 1272.60 — over the near term. If they head lower, the 1207.00 target flagged here earlier is still valid and can be bottom-fished with a stop-loss as tight as a point.
Silver has been in a holding pattern for two months, so let’s not begin the day expecting too terribly much. A print at 18.815 is what we should want to see before we take serious encouragement, since that would exceed a look-to-the-left peak on the hourly chart that was made May 19 on the way down. If you’d prefer to be on a hair trigger, and perhaps to get long using camouflage, the impulsive breakout on the 3-minute chart would come at 18.335.
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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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.
NY Times Feature No Kiss of Death for Gold
by Rick Ackerman on June 15, 2010 12:01 am GMT · 36 comments
Investors enamored of gold now have two supposed contrary indicators to worry about: the New York Times, which did a front-page feature over the weekend on bullion’s growing popularity as an asset class; and CNBC, where a Deutsche Bank analysts on Friday predicted a $75 surge to $1300 an ounce over the next few days. Although we’ve never been comfortable following recommendations aired on CNBC, the ostensible endorsement of the Gray Lady is another story. Our respect for the Times’ business section goes back to the summer of 1976, when they were the first big newspaper to notice that a small company called Resorts International had opened an office in Atlantic City. Resorts’ common shares were selling for about $2 at the time, but – gold bugs take note – after the Times story ran in August, RTA class ‘B’ shares began a » Read the full article