As last week ended, one might have believed Wall Street investors had just about everything wrong. Stocks were up sharply on bullish payroll news that flatly contradicted something every American knows – i.e., that the Great Recession is still very much with us; T-bonds were getting whacked on the flimsy assumption that the economy is picking up strength; and gold and silver were under attack because, well, because all was right with the world. Even the hacks and scribblers who bring us the news did their bit to feed Friday’s feel-good binge. For one, there was nary a discouraging word on the Web’s main news pages about Greece and its slow-motion bankruptcy – only a story about how Europeans were working diligently to protect the homeless from a cold snap. And the left-tilting L.A. Times, thinking wishfully, weighed in with the most fatuous story of the day: an analysis piece saying that the payroll numbers could prove to be a turning point in Obama’s reelection year — the day when he shifted from slight underdog to favorite. » Read the full article
With the E-Mini S&Ps and April Gold both somewhat lower Sunday, it would appear that they have been resynchronizing. My outlook for both is bullish, although it looks like they could use a day or two of rest before attempting another leg up.
The news media have gotten revved up about a possible pre-emptive strike by Israel on Iran’s A-bomb facilities, but if it were imminent crude would be warning us by moving higher rather than lower (just as it did, mysteriously, two months before the U.S. invasion of Iraq). So that we can tune out the hysterical noise, we’ll want to keep close tabs on the March contract by setting a screen alert at 103, somewhat below December’s high, to warn of an impending conflagration. Incidentally, Rick’s Picks subscribers receive real-time alerts about such things. Want to try a free trial subscription? Click here.
Tesla got short-squeezed to within 28 cents of the 86.72 target I’d proffered early Monday morning, but a second-wind rally to 88.00 suggests it’s got eyes for 104.44, the ‘D’ target associated with the first number. It can serve as a minimum upside objective for now, implying that all trades between here and there be positioned from the long side. We’ll plan on buying weekly puts if and when the target is reached, provided it happens before Wednesday of the given week. Please note as well that a lesser Hidden Pivot at 94.19 (see inset) has the potential to stop the rally cold and can therefore be used for spec camouflage shorts.
All signs point higher at the moment, but even Google will have to top somewhere. My best-bet for a short-able apex is 929.78, the Hidden Pivot target of a well-defined ABCD on the monthly chart (see inset). You can try shorting with camouflage at that number, or at the D target (in purple) of the lesser pattern, but until then all trades should incorporate a bullish bias.