Thursday, August 18, 2011

SBV11 – October Sugar (Last:29.46)

– Posted in: Current Touts Rick's Picks

Prompted by a bullish note from our commodity-savvy friend Mike Schurr, I called up a sugar chart and it does indeed look promising. Two Hidden Pivot targets come plainly into view, the lower of which, at 32.56, would represent an approximately 10 percent rally from current levels; the higher, at 33.76, a 15-percenter. The accompanying chart reveals details that will likely be of use to Pivoteers -- and with the recent pop above a tiny look-to-the-left peak, to camouflageurs as well. _______ UPDATE: Sugar has gone into a dirge of consolidation after having gone  no higher than 31.85.  We'll put this one on the back burner for now.

SIU11 – September Silver (Last:40.300)

– Posted in: Current Touts Rick's Picks

No change. If Silver's uptrend, such as it is, were any more subtle or tedious, the futures would be flatlining.  The dominant trend remains bullish nonetheless, and the most obvious rally target for the short- to intermediate-term is a 44.510 Hidden Pivot on display here previously. A crucially important midpoint resistance lies at 40.770, and the September contract will need, simply, to demolish it in order to become interesting once more.

GCZ11 – December Gold (Last:1794.80)

– Posted in: Current Touts Free Rick's Picks

We're using an important Hidden Pivot midpoint at 1809.50 as a minimum upside target for the near term.  How important?  It's linked to a 'D' target at 1893.10, so a two-day close above it would have very bullish implications for the intermediate term. The provenance of both numbers is shown in the accompanying chart. It's the same pattern as the one reproduced here yesterday, but with a different emphasis and different details.

QQQQ – Nasdaq ETF (Last:51.50)

– Posted in: Current Touts Rick's Picks

I've tired of waiting for this cinder block to reach our rally target so that we can get short.  Instead, let's try to leverage the downside by legging into a risk-free butterfly spread.  This is never easy, but we won't chase opportunities if they don't come to us.  For starters, and pursuant to building an October put 'fly using the 50/46/42 strikes, let's bid 0.53 for eight October 46 puts, day order.  Don't worry if the order goes unfilled, since we're going to keep trying. ______ UPDATE (9:46 a.m. EDT):  With stocks in their increasingly familiar collapse mode today, the October 46 puts opened up on a gap and never traded for less than 1.02.  As implied above, as the Mother of All Bear Markets proceeds, there will always be other opportunities.  For now, though, cancel the order.

Palpable Weakness

– Posted in: Free Rick's Picks

We've been fixated on a not-terribly-ambitious 1227.25 rally target in the E-Mini S&P for so long that DaBoyz' weakness is becoming palpable, as though they had been exposed to Kryptonite or something.  While it's pleasant to see the bunko artists in such a weakened state, they have yet to be brought to their knees, let alone be decimated.  Patience is called for -- and also diligence in looking for small patterns than can get us short.

ESU11 – September E-Mini S&P (Last:1183.75)

– Posted in: Current Touts Rick's Picks

A bull trap sprung in the opening hour yesterday has given way to a moderate sell-off that was still in progress early Thursday morning. It has the potential to hit 1173.00 over the near term, or 1167.25 if any lower. That second number is tied to a Hidden Pivot midpoint at 1179. 75, so night owls should look for a camouflage opportunity to get long there.  However, if there is no tradable bounce, odds of more weakness down to at least 1167.25 will shorten.  Alternatively, DaBoyz would need to short-squeeze this hoax above 1193.00 to temporarily restore control to the algo traders. The significance of that number is shown in the accompanying chart.  _______ UPDATE (9:53 a.m. EDT):  The futures are getting savaged this morning, down the equivalent of 35o Dow points on the opening.  The so far low at 1150.25 has come within a single tick of the Hidden Pivot support of a pattern created overnight (15m, A=1183.25 at 1:45 a.m., B=1162.25 at 5:30 a.m.), but if the low gives way, a new wave of selling could push this pup all the way down to 1141.25 (A=1192.50).

A Savvy Advisor Prepares Clients for More Deflation

– Posted in: Commentary for the Week of March 8 Free

[With unemployment above 9% and productive capacity heavily underutilized, the U.S. economy is slipping back into official recession. In a letter to clients, our friend and financial advisor Doug Behnfield has predicted that deflation is about to return with a vengeance -- presumably with bullish implications for high-quality bonds and, get this… municipal bonds. For Doug’s take on the stock market, fixed-income securities and a Baby Boomer cohort that is ill-prepared financially for retirement, read on. RA] Over the last few weeks, stock, bond and commodity markets appear to have played "catch up" to fundamental economic changes that began early in the first quarter. In early February, 30-Year Treasury Bond yields peaked at 4.8% and started down sharply as bond prices rose. The municipal bond market did the same. The S&P 500 hit 1300 and essentially stopped rising, creating a volatile topping process that lasted until late July. Since then, the bottom has been dropping out of both stock prices and bond yields. The Fed has promised to keep very short term interest rates at 0% for at least the next two years. The economy now appears to have rolled over early in the year. Employment and housing prices peaked in the first quarter and GDP growth was revised down to 0.4%. At year end 2010, Q1 2011 GDP growth was widely expected to exceed 3.5%. State and local governments began aggressively tightening their budgets and it seems clear that the federal government will be doing the same. Standard & Poor's (and the other rating agencies to a lesser degree) have put congress and the administration on notice that the debt bomb must be defused immediately and the vast majority of voters seem to agree. The fiscal drag could be enormous. Or we become a Banana Republic. The median age of