Tuesday, September 21, 2010

Silver slipped two ticks beneath a minor midpoint support at 20.745 that we identified during yesterday's impromptu webinar, but sellers gave up after struggling for hours to take the futures any lower.  The bounce so far is impulsive on the 10-minute chart, affording night owls a possible entry opportunity if the pullback produces the required single-bar 'C'.  I have explained this graphically in the accompanying chart. ______ UDPATE (2:43 a.m. EDT): Yuk!  The pattern shown in the chart failed to develop when the pullback retraced all the way down to 'A'.  As of the moment, the correction looked bound for at least 20.615.

Waiting for a finishing stroke to 1290.90 has become so tedious that perhaps we should be on our guard against the unexpected swoon. From a Hidden Pivot perspective, the downtrend would become impulsive on the hourly chart if it were to hit 1272.30 today, surpassing two 'external' lows.  Even so, we'd want to attempt bottom-fishing at the midpoint of the follow through leg. This is shown hypothetically in the inset. ______ UPDATE (2:39 p.m. EDT):  Gold's Comex handlers proved they're every bit a sleazy as DaBoyz who work the shares of Goldman, Google, Apple et al.  The non-news that the Fed will continue to pretend that it has leverage over the economy drove bullion quotes sharply vertical, but not before December Gold had foot-faked down to 1272.00, cannily trapping the bulls ahead of the short-squeeze that instantly followed.  The result so far is dueling impulse legs on the hourly chart and a moderately bullish bias going forward.  The 1290.90 target stands against a so-far high today of 1289.40.

I've already touted the prospect of a bullish turn based on the failure of the most recent down-leg to reach a Hidden Pivot target.  The bullish potential has yet to be actualized, however, and would require a print at 133^23 this week to clinch a reversal of at least intermediate-term importance.

There's a bit more immediate upside -- to the 1151.25 target shown in the chart -- and you can short that Hidden Pivot with a stop-loss as tight as 1152.25. Notice that there's another target too -- of a larger order or magnitude, at 1156.00.  I prefer the lower one, however, since the point 'B' of the pattern yielding the higher target did not exceed June 21's 1124.50 peak.  It is therefore not a true impulse leg, but rather a rally of "sausage-factory" quality.

For once, the mainstream press has greeted “good” economic news with the blunt skepticism it deserves. According to the Cambridge, MA-based National Bureau of Economic Research (NBER), the Great Recession ended in June of 2009, eighteen months after it officially began.  “So Where’s the Party?” asked the Associated Press in a headline that topped Google’s afternoon news roundup.  “[The recession] may be over,” wrote AP reporter Jeannine Aversa, “but you won't be hearing any cheers from the millions of Americans who are struggling to find a job. Or are worried about the ones they have. Or have lost their homes. Or are behind on the mortgage.”  Ms. Aversa even managed to extract the perfectly pithy quote from former communications worker Bob Johnson, who’s been looking for a job for more than three years: "Every single one of the individuals who wrote the report needs a serious reality check," he said.  Our sentiments exactly.  This story is destined to rank right up there in the annals of foolishness with Bush II’s declaration that the war was over in Iraq, and with official estimates that more than 74% of the oil spilled in the Gulf had either evaporated, dispersed or been absorbed. So what does the NBER have to gain by making themselves look like dummies in the eyes of tens of millions of Americans who are either unemployed, underemployed, or working harder than ever just to stay afloat? We  can only speculate that the eggheads who compile NBER’s statistics got bored and decided to go out on a limb just for the hell of it. The bureau’s economists, who come from academia, business and trade unions, have been tracking recessions for the U.S. government since 1910. They are the official arbiters of when each recession has begun and ended, and perhaps