Trading Newsletter for Gold, Silver, Stocks and Mini Indexes
From the monthly archives:
Our minimum upside objective remains 20.45, and although I don’t expect this important Hidden Pivot resistance to be a pushover, you should keep a 21.39 target in the back of your mind when 20.45 is blown to smithereens, as it eventually will be. I have reproduced Silver’s 180-minute chart so that you can gloat over how a big, bad Head & Shoulders pattern has been reduced to a joke by Silver bulls.
A Hidden Pivot at 1272.60 is still our minimum upside objective for the near term — and, yes, it is frustrating that Gold, unlike stocks, is not moving effortlessly higher every night on short-covering into non-existent volume. Still, which would you rather own: shares or bullion? That’s what I thought. Please note that if 1272.60 falls easily — meaning, is exceeded by $1.00 or more within 15-20 minutes of first being touched — expect more upside thereafter to at least 1293.50.
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We hold four July 96 puts for 0.70 on a hunch. They are apt to get bludgeoned anew when Sunday night’s short-squeeze has its intended effect on Monday morning’s opening. Hold tight, for now, though, and look for a possible key reversal at the targets given for the Diamonds, E-Minis and the Dow. _______ UPDATE: Buy four August 98 puts if DIA gets within 0.05 points of the next Hidden Pivot resistance above, 105.92. You should be prepared to buy four more August 98 puts later if the Diamonds get past 105.92, since that will imply they’re going to at least 106.73 before a top is in. We are going out to August because the remaining life of the July options will be shortened not only by their July 15 expiration date, but by a holiday weekend. _______ FURTHER UPDATE (11 a.m EDT): With DIA having topped so far today at 105.96, we bought four August 98 puts for 1.28 (they traded down to 1.25). The Diamonds have since pulled back to as low as 105.33, but keep your powder dry to buy more puts in case this vehicle pops to the next target. The 0.05 overshoot has NOT increased the odds that this will occur — we’ll simply consider it the margin of error. _______ FURTHER UPDATE (12:42 p.m. EDT): Using a 1.50 offer, exit half of the puts purchased earlier this morning for 1.28. With DIA trading 105.10, the puts are currently reflected at 1.47-1.52.
Late this evening, the futures were in the throes of yet another Sunday night short-squeeze. The high so far has been 1127.50, a single tick from the 1127.25 rally target we were using as a minimum upside target on Friday. The futures have since backed off as much as 10 points, but the hysteria that has already transpired might still require a catch-up rally in the Dow to 10572, a target that corresponds to the E-Mini target. The pullback has alread exhausted an 1116.00 midpoint support and gone on to create a new and higher point ‘C’; otherwise, I might suggest bottom-fishing for night owls.
Will the oil gusher in the Gulf eventually destroy all marine life, as oilman Matthew Simmons asserts, or will the disaster instead be contained once BP’s relief well comes online sometime in July or August? Simmons, a peak-oil proponent and no stranger to controversy, has been warning that a second well cannot alleviate the problem because most of the oil, now estimated to flow at around 60,000 barrels per day, is coming not from the well bore but from innumerable ruptures in the sea bed around the Deepwater Horizon site. Because of this, he says, there are only two possible options: allowing the well to run dry — a process that would take 30 years and destroy the Gulf of » Read the full article
California is on the verge of system failure, says this latest report from CTV news. We would hasten to point out that the report implicitly shares Warren Buffet’s dangerously stupid idea that the Federal Government will eventually have to rescue beleaguered cities, counties and states. Where, one might ask, will a just-as-bankrupt Federal government get the money if the cities and states themselves cannot squeeze it from taxpayers? Or would we purport to fix the U.S. economy with yet more printing-press dollars from heaven?
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The Dollar Index head-faked yesterday morning before plummeting to within 0.11 points of the 85.41 Hidden Pivot we were using as a minimum downside objective. Any lower would portend 85.01, or perhaps 84.91. The 85.41 pivot itself remains valid as well and could evince a bounce, since it remains unbroken as of this writing. ______ UPDATE: The Dollar dove anew today but still couldn’t break the 85.41 hidden support. The low was 85.45 before DXY rallied to a so-far recovery high of 85.77. My hunch is that the support will give way on Monday. When it does, look for a new leg down to exactly 85.01.
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HGU10 – September Copper (Last:3.0365)
by Rick Ackerman on June 21, 2010 8:43 am GMT