Friday, December 10, 2010

I've drilled down to the 15-minute chart to display a nubbin of resistance (a.k.a. look-to-the-left-peak) along the otherwise cragless wall of Tuesday's decline. It lies at 29.380, and we should ask that a rally exceed it before sounding the all-clear (better make that the "somewhat clear," since we're using a quite subtle directional indicator here).  Notice that there are a few peaks from Thursday's session to allow night owls to test the water, bottom-fishing with relatively little risk.

The futures lunged three times yesterday on the hourly chart, but none of the thrusts was sufficient to clear even a single external peak. They'll have another chance to get out of trouble today, but it will take no less than 1396.90 to put the bad guys on the run. If, instead, yesterday's 1395.60 peak endures, you can try bottom-fishing at 1366.20, stop 1365.90, my worst-case target for the next 2-3 days.  (A second pivot that is shown in the chart could turn the futures higher from 1370.90, but bottom-fishing there would be somewhat riskier.)

Although Rick's Picks is designed to look like a horse player's tout sheet, subscribers will know that I don't often feature hot tips.  I made an exception for Phil Calderone's hot tip on Kodak because Phil has produced some timely winners in the past, and because the stock had been working on a bullish flag for a month. This tip will have paid off well for anyone who took it to heart.  Pivoteers may have noticed that the stock's impressive leap yesterday stalled precisely at a 'D' target (shown).  EK looks to be consolidating, and so I will pass on to you Phil's latest update -- and caveat emptor.  He sees the stock as having entered the second of three stages that will take it to around $8 sometime in the first quarter of 2011. More immediately, and from a Hidden Pivot perspective, EK looked especially impressive yesterday because the thrust breached two "external" peaks on the weekly chart.  That doesn't necessarily mean it's going to the moon, but it does strongly imply that any weakness in the offing should be viewed as corrective.

Slithering higher on zero volume Thursday night, the futures were doing what they do best:  achieving gains that might have been denied them in the light of day. Pivoteers might notice that the shallow correction from Tuesday's peak was actually sufficient to have recharged the futures for yet another flight of fancy. The implied rally looks too steep to believe -- more correcting seems needed, visually speaking -- but if Friday Follies produces a short squeeze nonetheless, you should use a Hidden Pivot at 1245.50 as a minimum objective.  Its provenance and pedigree are shown in the accompanying chart, and it's shortable with a three-tick stop-loss.

In a rebuke to the Republican Party, Tea Party co-founder Mark Meckler issued a stern reminder yesterday that last month’s GOP landslide was not supposed to usher in a period of pork-laden compromises on Capitol Hill. “If the Republicans choose to go down the wrong path,” Meckler told Fox’s Neil Cavuto, “they’re going to get punished at the ballot box in two years.”  He said the Republicans’ back-room deal with President Obama to extend Bush-era tax breaks is already proving far too costly, since it is being greased with budget-busting earmarks and other costly political goodies. Cavuto himself estimated that when the wrangling was done the deal would hit a trillion dollars, most of it in tax breaks, but he called the proposal beneficial overall. Would Meckler himself vote for it if it were stripped of all spending provisions except for the 13-month extension of unemployment benefits?  Cavuto asked. “Absolutely not,” Meckler insisted. He told Cavuto that he could never look his kids in the eye if he had voted to burden them with billions of dollars of new debt. The only solution – the one voters resoundingly endorsed in November – is to go “cold turkey,” said Meckler. “It’s time for hard remedies. To [pretend] otherwise is not fair to our children and grandchildren.” GOP’s ‘Prince of Pork’ Although there are provisions in the deal that would somewhat soften the blow of estate taxes, Meckler said the tax should be eliminated entirely. “I’m just a simple guy,” he said, “and a death tax is wrong.”  He also was critical of the Republicans’ decision to put Kentucky Rep. Hal Rogers in charge of the House Appropriations Committee.  Meckler has called Rogers “the prince of pork,” and he regards the Congressman’s new committee assignment as a sign that nothing has really