The stock market hasn’t been much fun to trade in a while, but that could change today as the broad averages approach some potentially important rally targets of ours. Want to know exactly where these targets lie but don’t subscribe? Click here for a free trial subscription that will give you access to our proprietary numbers. One of them foresaw a 600-point rally in the Dow that is nearly complete. The other is a bullish target for the E-Mini S&Ps that smacked us in the eye yesterday with its clarity. There are also two bank stocks whose deft handlers appear to be setting up suckers for the kill. These financial biggies are household names, but because they are in the thick of Europe’s bailout hoax, they are destined to go down with the ship. Under the circumstances, the hysterical, short-squeeze rallies that have driven their shares steeply higher may be ready to seven-out. » Read the full article
I’ve asked veteran camouflageurs who frequent the chat room to guide less-experienced traders if an exceptional opportunity to short the E-Mini S&P should occur when I’m not around. If our entry trigger gets hit while I’m conducting the weekly tutorial session online between 11 a.m. and noon EST, I’ll make sure the information is disseminated in the chat room at that time.
I’ve alluded to a key target in today’s commentary, and although merely talking about it has made it one of those high-profile numbers that are probably jinxed from the start, the Hidden Pivot itself is real enough and should provide sufficient stopping power to allow us to get short without risking too much.
Putting aside the promotional hubris of today’s commentary, which the public can access, subscribers should be aware that if the futures reach the 1353.00 target, they’ll be in new recovery territory, trading above April’s important 1344.50 peak. That implies that they will have created a fresh bullish impulse leg on the daily chart, an eventuality that will shorten the odds of our hitting a four-bagger on a bear trade. Still, our goal will be to get aboard without stress, and to simply go with the trade as far as it will take us. My hunch is that the 1353.00 pivot will be hit overnight Tuesday or Wednesday morning, so I’m depending on the legion of experienced camouflageurs who frequent the chat room to guide rookies if things pan out as we might wish them to. _____ UPDATE (February 9, 11:22 a.m. EST): The futures spiked to 1352.75 about 50 minutes before the opening bell. Some subscribers evidently got short, and said so in the chat room. However, strictly speaking, it was not possible to do so via camouflage until about 90 minutes later, so I won’t record the trade officially. Unofficially, though, and for your further guidance, with the futures currently trading around 1346.00, I’d suggest covering three-quarters of the original position for a profit, tying the remaining 25% of it to a stop-loss at 1349.75. This is not a trade on which we should be swinging for the fences, since the markets are waiting opportunistically for news on Greece – any news at all will suffice — that will conduce yet another short-squeeze and running of the bears. Concerning the Fat Lady’s aria, keep in mind that there is still an outstanding target at 13085 in the Dow Industrials. _______ FURTHER UPDATE 11:36 a.m. EST): The 15-minute chart is currently bearish, working on an ABC correction (A=1350.25 at 9:45 a.m. EST) that projects to 1337.50. This implies a possible ‘camo’ buying opportunity on any minor abc rally at the 1342.00 midpoint associated with the target. That last number is also my minimum downside objective for the very near-term. ______ AND FINALLY… (1:34 p.m. EST): As I noted a short while ago in the chat room, the fact that the futures were unable to correct down to the 1342.00 midpoint augurs new highs, probably today.
April Gold did not adequately correct the hourly chart to set up an instant push above last Friday’s 1765.90 peak, but the 30-minute bars will at least get the futures to the 1760.20 ‘D’ target of the lesser pattern shown (see inset). If it gives way easily, bulls should have little trouble taking out the higher peak soon thereafter. (Click here to learn more about the Hidden Pivot Method we used to forecast and trade futures and stocks.)
After pushing decisively past it, the stock appears to be consolidating at the 24.94 midpoint pivot of a bullish pattern projecting to 30.65. That would represent a 23% rally from current levels, implying traders should position from the long side. You can do so most aggressively if using ‘camouflage’, and the best place to find it at the moment will be on the 10-minute chart, which contains several ‘external’ peaks that can be used for leverage. _______ UPDATE (7:48 p.m. EDT): Some chat-roomers evidently took my bullishness on the stock as a go-ahead to buy call options. Keep in mind that I suggest using options for directional plays only if one is fairly confident the position will go into-the-black within perhaps 15-30 minutes. Practically speaking, this means buying puts or calls only at Hidden Pivot swing points. Going out to May expiration is okay if you plan to calendar-spread calls you’ve bought, but for all intents and purposes, going out further in time with options is only stacking the deck against yourself. For all buyers of options at all times, time works against you, and the further out in time you go, the greater your odds of losing. I will be tracking SLW closely in the days ahead, looking for an opportune spot to get long. If you’re interested, stay tuned to the chat room and to email notifications.
We got a clear and decisive answer yesterday to the question that has been on every tiny, fevered brain up and down Wall Street: How long do we have to feign concern over the situation in Ukraine? The Dow finished up 228 points after being up as much as 250 points intraday, proving yet again that the stock market, fed by a limitless stream of easy money, has absolutely no connection to the world of events. Unfortunately, traders had little opportunity to grab the rally by the tail, since it was effectively over on the opening bar (see inset). And by day’s end, it had left bears pinned to the ropes yet again, ready if unwilling to energize the next freakish, short-squeeze to who-knows-how-high.
Actually, we do know how high, since there’s a clear-as-day Hidden Pivot target at 16437 on the intraday charts, and another at 16607 if the first fails to contain the opening-bell stampede. A move exceeding the lower number by as little as 4 points should be regarded as the go-ahead for achieving the next. Traders looking to get long using the ‘camouflage’ technique should focus on the 10-minute chart, since it was bullishly impulsive at Tuesday’s close. You should also view a retracement to 16339 as a possible buying opportunity, since that is the midpoint Hidden Pivot of the rally pattern yielding the target at 16607. Either of the two targets is shortable using the Diamonds, and the second can be shorted with a micro-tight stop-loss instead of camouflage. If you’re lucky enough to have been long on the way up, I’d suggest using a portion of your gains to short 16607 more aggressively. For a simple strategy using put options, check out today’s tout for the Diamonds.
This popular gold mining vehicle is taking its sweet old time consolidating, but when it develops sufficient thrust for takeoff, expect the move to reach the 50.71 Hidden Pivot target shown in the chart. That would represent a move of nearly 20% from these levels, but if it unfolds with the speed of the initial leg we could be there by April. The rally should be considered under way when GDXJ has decisively exceeded the 45.55 midpoint (i.e., by perhaps 20 cents) or closed for two consecutive days above it. Traders looking to ‘camo’ their way aboard with minimal risk should do their hunting on the 15-minute chart, where there are some decent ‘external’ peaks to be found in price action over the last two weeks.
Facebook has just paid a whopping $18 billion for an instant-messaging application that evidently has caught on with the kids. The company, WhatsApp, has 55 employees, and its two founders are now billionaires. It would hardly surprise if their clerk-typist and janitor have become multimillionaires. No one knows what kind of revenues the company has been generating because that’s a secret. But they do not use an advertising model, and subscriptions are free for the first year, rising to $1 a year thereafter. Zuckerberg paid about $40 per for each of WhatsApp’s 450 million users — supposedly the going rate. Frankly, we view these valuations as absurd. However, such concerns didn’t stop Wall Street’s OPM stewards from goosing FB sharply higher yesterday, pushing the stock well past a 67.43 Hidden Pivot target that we might have expected to contain FB for more than a few days. Keep the number 75.82 in mind, because Hidden Pivot analysis says that’s where this gas-bag will bump up against something solid. We’ll be looking to short aggressively up there, so stay tuned to the chat room and to the tout updates if you’re interested. _______ UPDATE (February 28, 2:50 a.m. EST): Yesterday’s detour south could take the stock down to 67.66 if the intraday low, 68.85, gets taken out. The target can be bottom-fished with a limit bid and a stop-loss as tight as 5 cents. ______ UPDATE: Friday’s 67.38 low overshot my target by 28 cents, stopping out any bidders who played it by-the-book. The overshoot of the target suggests that still-lower prices may impend. _______ UPDATE (March 10, 11:33 p.m.): Once past a midpoint resistance at 72.20, expect this stock to cruise to at least 74.93 (daily chart, A=66.51 on 3/3), the next Hidden Pivot resistance of significance.
The drumbeat of dollar bears has grown louder in recent months, with some of my colleagues suggesting that a collapse is imminent. Technically speaking, I’m just not seeing it. The Dollar Index has in fact been one of the world’s most boring trades for the last three years and is currently thrashing around near 80, about where it was ten years ago. In the intervening decade, although there have been some big swings, it has crossed trendlessly up and down through 80, the approximate midpoint of a 20-point range, no fewer than 15 times. If I had to bet which direction the next, presumably insignificant, move will be, I’d give 6-5 odds that it will be up.
Don’t’ get me wrong: I completely agree with those who tirelessly assert that the dollar is crap. Even so, it is the crap the world chooses to hoard against the threat of financial collapse; it is the crap that financiers bet on whenever some geopolitical crisis causes a global tremor; and it is the crap that the paper shufflers bet with — to the tune of a quadrillion dollars — whenever they want to make big money with relatively little work. These factors greatly outweigh any reservations they may have about taking dollars in exchange for all of the things that Americans consume. Crap or not, the dollar will remain buoyant until the day the rest of the world realizes the U.S. economy is kaput and that the confidence that supports the financial shell-game was egregiously misplaced. This will happen with the swift, destructive force of a nuclear blast, by the way, rather than via a comfortable and more or less predictable process of depletion. _______ UPDATE (March 2, 9:56 p.m. EST): The dollar has bounced precisely from the 79.68 target shown (see inset), but if the support gets taken out within the next couple of days it would be evidence of further weakness to come.