Friday, December 2, 2011

Gold has been pulling Silver along, but if the latter is to be judged capable of flying solo, we should expect to see a pop today exceeding 34.005, an 'external' peak noted in the chart that accompanied yesterday's Silver tout. (Check the pulldown archive under the symbol SIH12).

We're long a single contract with a cost basis of 1708.00 after imputing to it paper profits we made closing out three contracts earlier. Raise the stop to 1716.10 for now. A key test awaits at 1770.20, the midpoint Hidden Pivot of the large pattern shown. It can serve as a minimum upside objective for the near term, with a 'D' sibling at 1869.80, a major rally target given here earlier.  If and when 1770.20 is touched, we'll switch to a stop-loss that would take us out of the remaining piece of our position if a downtrending impulse leg is generated on the hourly chart.

The 140^14 correction target drum-rolled here yesterday has been exceeded by eight ticks, or a quarter of a point. Ordinarily, because the pattern associated with that target is so clear, we might infer from even so small an overshoot s that significantly lower prices impend. In this case, however, we'll reserve judgment for now, since there was an important low at 140^02 (November 13)  helping to pull the futures down.  Which is to say, the "magnetic" attraction of that low overpowered the Hidden Pivot support.  Now, the  December contract would need to hit 142^04 today to get out of immediate jeopardy, since that's what it would take to generate a bullish impulse leg on the hourly chart.

A day of tedium has not much altered the bullish projection given here yesterday.  Continue to use 1255.75 as a minimum upside target, but allow three more points, to 1258.75, if it's exceeded.  With the weekend fast approaching, I'll leave it to you to determine whether it's worth the trouble to immerse yourself in a potentially herky-jerky trading day. If you desire a simpler path, I'll suggest risking a 1259.50 stop-loss shorting the higher number. This would be a day trade, not a position to take home over the weekend.

Although we shouldn't get our hopes too high, technical evidence presented in today's tout for Goldman Sachs suggests that the stock could be on its way to oblivion. A further fall of $31 from current levels seems plausible in any case, so let's stay on top of the stock for now, the better to leverage the move.

[Ever consider stuffing money in your mattress to guard against a banking collapse? Here’s a guest editorial from our friend Erich Simon that suggests you might be better off taking your nest egg and buying…a bunch of mattresses. We’re not sure whether Erich’s point is being made tongue-in-cheek, but we are convinced, after an exchange of several e-mails, that he is a true connoisseur of bedding and accessories.  RA] I just shelled out $2,400 for a traditional, coil-spring twin XL mattress set. Apparently I am not alone with mattress horror stories. Is the new mattress worth $2,400? I don't know, but it's got a 10-year warranty. Only problem with that is a $2,400 replacement mattress in ten years will be a smidgen of what I just received.  Adjusted for Net Present Value and the ongoing bleed of “quality metric,” probably a lot less, so for all intents and purposes my purchase will have depreciated down to sub-zero. Of course, if I were buying the hedonic of a new computer ten years out I would no doubt improve on existing “capacity.” A mattress is a better barometer than a computer or a traditional store of value, including gold. Mattresses consume scarce resources like cotton and petroleum. Mattresses are something everybody needs, and they wear out and have to be replaced. Mattresses are not purely “frivolous tangibles” and speak to the Means of Production (MOP) in our factoried society. They are price-pointed to exhaustion on the demand side. Labor costs, like everything else, while in the short term can fall from layoffs, will only continue to rise as increases in the minimum wage are passed through the pipeline. Acquiring 20/20 economic vantage starts by ranking each of the millions of products and services on a “necessity-luxury” scale and regularly updating the ratings