Tuesday, December 28, 2010

We've analyzed the T-Bond bear market closely during the Wednesday tutorial sessions, but here's a picture for the tout section that can be archived. Because there is such clarity in the 117^22 target and the daily-chart pattern that produced it, we should confidently expect more weakness down to at least 117^22. Also, any rally to the midpoint pivot, 122^27, should be regarded as an opportunity to try shorting with a tight stop-loss. ________ UPDATE:  On second thought, we'll pass on any opportunities that may arise to short 122^27, since it's possibility such relative heights could be achieved simultaneously with the creation of a powerful impulse leg on the intraday charts.

Silver has taken an encouraging leap early Monday evening after spending most of the day screwing the pooch. The move is nicely impulsive as well -- and possibly even camouflage-worthy, since the peak of the thrust failed by two ticks to exceed a presumably well-watched peak at 29.485 recorded last Wednesday.

A 1396.30 benchmark that we used yesterday can continue to serve as an alert if bulls should turn serious.  This seems unlikely in the absence of news to drive the metals market, but stranger things have happened.  Alternatively, a midpoint support on the hourly chart at 1369.30 can be used as a downside objective if gold gets sacked, but it is too murky to use for tightly stopped bottom-fishing.

The slowest trading day of 2010 produced intraday charts for this vehicle that look like a bowling ball's EKG.  We'd anticipated this in the weekly tutorial session and expect more of the same as the week wears on.  That said, the upward drift produced an impulse leg on the hourly chart that might prove to be exploitable if it traces out a correction similar to the one shown. Camouflage artistes should make certain that any such pullback meets all of our rules, including being equal, at least, to 0.618 of the k-A segment.