Thursday, October 14, 2010

December Gold has been up as much as $9.30 so far tonight, putting it within $1.90 of the target we've been using at 1381.70.  This has been our minimum price objective since the futures were trading $50 lower, but if the Hidden Pivot resistance gives way easily and the futures poke $2 (or so) above it, look for a finishing stroke over the near term to at least 1400.80. That's the next bullish Hidden Pivot in a sequence derived from the weekly chart.  Each of the pivots is capable of showing tradable stopping power, but scalpers should not risk more than 40 to 60 cents trying to impede this freight train.  Profit-taking on long positions is another matter, but an option hedge is suggested at the least. If it's covered just above 1381.70, you will likely have given up only a couple of bucks of the $21 that would remain to 1400.80. _______ UPDATE (8:21 a.m. EDT):  Gold has been as high as 1388.10 overnight, so it's probably time to consider the next target in the sequence: 1415.40. This one comes from the daily chart where A=21.060 on September 28, but as you can see, it is not a true low because it has no high preceding it. I have put this concern aside, however, since the low itself is so visually distinctive, and we'll raise our minimum objective over the near term to 1415.40 with the usual caveats. For starters, the 30-minute chart (though not the hourly) would turn bearish with a print today at 1368.75.

It's shortly before 10 p.m. EDT, and the futures have exceeded by a penny the 24.315 target we were using as a minimum upside objective for the near term. The overshoot is not yet sufficient for us to consider the hidden resistance spent, but if buyers should push a bit higher -- say, to 24.340 -- we should infer they're capable of reaching 24.820, the next Hidden Pivot in the bullish sequence.  The implied 50-cent upthrust would be tradable in theory, but it will require a "camo" expert to get on board at just the right time.  Please note as well that on the hourly chart, it would take a print down at 23.270 today to suggest that bulls may be exhausted.  (Note: To view the price pattern associated with today's target, call up yesterday's tout, click on the chart, and visually lower the point 'A' by one click.) _____ UPDATE (8:29 a.m. EDT):  Buyers shredded the 24.820 target overnight, reaching a so-far high of 24.950.  Because this occurred with a fleeting spike in the middle of the night that gave way to a 68-cent (!) pullback, we should consider ourselves warned:  short-squeeze dynamics obtain, and the action is apt to grow wilder than anything we've seen in a generation. For your information, the next compelling, Hidden Pivot rally target lies at 25.365.

It’s shortly after 9 p.m. in New York, and the last of the trapped Chilean miners – Luis Alberto Urzua – has just emerged from the half-mile-deep hole that nearly became a tomb for him and 32 co-workers. Every ten minutes or so, the rescue capsule has surfaced, the crowd has broken into jubilant cheers and song, and a billion TV viewers around the world have greeted yet another survivor of a 69-day vigil that had elicited the prayers of the world. This scene was repeated 33 times, and yet it never grew old.  We wouldn’t mind seeing the capsule go up and down, and survivors emerge each time, in a loop that ran for a week. It’s been a long time since truly good news – great news! – dominated the airwaves. For each miner, there is a story to tell, and we will be hearing those stories in the weeks and months ahead. One emerged from the capsule a great-grandfather for the fourth time, while another found the welcoming embrace of his pregnant wife. Yet another who had arranged to have his mistress on hand found that his wife was not. A Chilean flag hung in front of the rescue shaft, a curtain to obscure video coverage if something went wrong. But nothing did. A 30-second delay for TV coverage was planned but never implemented. “The rescue operation was so marvelous that there was no reason not to allow the eyes of the world” to see it, Chilean President Sebastian Pinera told a Fox network reporter. Savor the News The world should salute the rescuers and savor the news. Never before has a human being survived after being trapped underground for so long.  For the first 17 days the miners were buried, no one even thought they were

A rally target at 576.19 that was first broached here nearly a month ago (with HUI trading around 500) is now in play, since a lesser target at 529 has been decisively exceeded. A secondary target at 558.55 is also beckoning, and so we'll make it our minimum upside projection for the near term.  If t should be exceeded on a closing basis for two consecutive days, the higher target would become an odds-on bet. Both targets come from the weekly chart (see inset).

We stumbled onto a possible opportunity yesterday when someone asked about Wheat during the weekly tutorial session.  Notice in the accompanying chart that the recent high at 739.75 lies just 2.75 cents (per bushel) below an entry trigger on the monthly chart at 742.50. If and when the long trade is signaled, I would suggest finding a small abc to make entry with a commensurately small stop-loss. (The alternative, placing a stop beneath the 643.50 point 'C' of the larger pattern would risk a whopping 99 cents per contract.) I've set a screen alert myself and will update with a bulletin in the chat room if this gambit materializes. _______ UPDATE (October 18): Before wheat bores us to death with its by-now protacted pullback, we'll remove it from the front page.  The 742.50 entry trigger will remain valid nonetheless until such time as 643.50 has been exceeded to the downside.

Someone in the chat room yesterday seemed to despair of the possibility that Minefinders Corp. would ever reach targets at $15 and $21 proffered by another guru.  From a Hidden Pivot perspective, both of those targets are out of range for now, and there is no stretching the evidence to suggest otherwise.  The picture would brighten, however, if MFN eventually succeeds at something it conspicuously failed to do last November and again in January -- i.e., surpass the 12.14 high recorded on the way down in July 2008. The good news is that the weekly chart is currently building on a bullish impulse leg with the potential to get MFN to as high as 11.89 over the next 6-10 weeks.

Cameco, a uranium play, has a chance to emerge from three years of purgatory if it can convert the nascent impulse leg shown in the chart into an abcd pattern that eventually reaches its target.  The impulse leg is promising already, having exceeded the requisite internal and external peaks on the weekly chart as well as a 29.98 target. It needn't even add a third peak -- last January's 33.74 -- to prove itself. I've sets screen alerts significantly above and below current levels and will update guidance if either is hit.