Wednesday, February 16, 2011

A modest after-hours rally in the E-Mini S&P has triggered the first of two scalp-shorts I'd suggested. Assuming an initial stop-loss of two ticks was used as advised, partial-profit taking could commence as early as 1331.50.

As usual, Silver did everything we asked of it yesterday -- with room to spare. Our big picture target at 32.525 will remain a lodestone, but more immediately we should count on 31.100, a Hidden Pivot 20 cents above yesterday's high.  Its provenance is shown in the accompanying chart.

Yesterday's low fell 13 cents shy of the bottom I'd predicted at 83.72, so we were denied an opportunity to get long at the day's best prices.  Generally speaking, Hidden Pivot targets for this vehicle require about 21 cents' leeway.  That's a bit rich for my taste and one reason that we don't trade crude very often. That said, any target that I might offer in crude can be traded via camouflage using a much tighter stop than 21 cents.

Like numerous other vehicles that we track, the Dow Industrials are closing on a Hidden Pivot resistance that's capable of engendering an important top. It lies at 12439 and is shown in the chart.  This number corresponds to the 12412 target already given for the Mini-Dow -- a target that can be shorted via camouflage or with a tight stop-loss.

No change since yesterday. Besides a major Hidden Pivot at 1356.00, there are two rally targets immediately above that come from lesser patterns.  They lie respectively at 1332.75 and 1339.25.  You can short the first with a stop-loss as tight as 1333.25; and the second, stop 1340.25. We are risking relative nickels and dimes so that if the futures don’t quite make it to 1356.00, we’ll have a horse in the race. _______- UPDATE (10:48 p.m. EST):  As noted elsewhere on this page, a modest after-hours rally in the E-Mini S&P has triggered the first of two scalp-shorts I’d suggested. Assuming an initial stop-loss of two ticks was used as advised, partial-profit taking could commence as early as 1331.50.

Using the Hidden Pivot Method, we were able to avoid wasting a day watching the markets do absolutely nothing on Tuesday. Instead, we lunched with our friend Josh at the Ten-Ten, a favorite Boulder bistro, then enjoyed the rest of the afternoon on the Pearl Street mall, soaking up some of the mid-60s temperatures that have settled over Colorado this week like a canopy of rainbows and rose petals. Those who have never visited Colorado’s Front Range probably think of postcards with snow-capped Rockies and assume the winters here are blustery. In fact, although there are occasional stretches of sub-freezing weather, shirt-sleeve days in mid-February are not all that uncommon.  Imagine being able to enjoy them knowing that you’re not missing even a mote of genuine activity on Wall Street. And so you could. You see, a little-known capability of our proprietary forecasting system is that it doesn’t get all antsy when nothing is happening.  Indeed, the Hidden Pivot Method is as happy as a clam when it is forecasting those unendurable stretches of tedium that occupy the markets perhaps 90 percent of the time.  Technically speaking, these hum-drum hours, days and even weeks are signaled on the charts by “dueling impulse legs.” Dueling impulse legs are simply upthrusts and downthrusts that happen in succession, each negating the last. String a few of them together on charts of different time frames and you get a picture not only of tedium in real time, but of tedium to come.  A Spectator Sport  Yesterday morning, there were dueling impulse legs everywhere one looked: in the E-Mini S&Ps, in Gold and Silver -- even in some world-beating stocks like Apple and Google.  We’d come to our desk bright and early looking for possible excitement, since some bellwether stocks and index futures that we