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.)
Slippage beneath the red line (p) late in Tuesday’s session implies the futures will now grope their way down to at least 1954.50 in search of traction. This target is a pretty one, and I’d have no qualms about telling you to bottom-fish there with a three-tick stop-loss if it were hit intraday. However, because the target is being disseminated overnight and therefore will not be as fresh and mysterious when the futures get there, I’ll advise a cautious approach that suits your style if you plan to bottom-fish. As always, the most logical short would be from p if the retracement rally now in progress gets there. Trading concerns aside, if the downtrend smashes the support it would indicate that the selling is waxing. _______ UPDATE (2:18 p.m.): Today’s hysterical, obligatory short-squeeze has come from 1956.50, cheating us out of an easy trade from the target I’d identified. There’ll be other opportunities, for sure. However, because the turn has come from a low that didn’t quite reach a clear correction target, bears had better give the rally wide berth.
As GDXJ was working its way south from around $43, my bearish forecast called for a washout low at exactly 40.42, a Hidden Pivot support of great clarity. I’d suggested buying down there ‘aggressively’ and with an ‘absurdly’ tight stop-loss. This advice would have paid off handsomely for anyone who followed it, since the stock trampolined 64 cents yesterday off an actual low of 40.43, a penny from my target. Since a subscriber reported doing the trade as advised, I’m establishing a tracking position for the further guidance of all who may have gotten long. (He reported having bought 1000 shares off a 40.44 bid, but I’ll assume a more conservative 400 shares.) Accordingly, I’ll recommend exiting half the position on Friday’s opening if you haven’t done so already. We’ll impute any profits thereof to the cost basis of the 200 shares that will remain. _______ UPDATE (July 27, 9:48 p.m. ET): Exiting 200 shares on Friday’s 41.20 opening leaves us with a tracking position of 200 shares whose imputed cost basis is 39.66. Exit another 100 shares on today’s opening and tie the rest to an impulse leg-based stop-loss on the 15-minute chart. At the moment, that would imply bailing out on an uncorrected dive touching 41.73. ______ UPDATE (July 28, 11:46 a.m.): We got sleazed when DaBoyz opened the stock on the so-far low of the day, 42.40. The good news is that such shakedowns usually occur because the smart money is trying to buy the stock. In any event, I am tracking a 100-share position with an effective cost basis of 37.25. For the time being, let it run. _______ UPDATE July 29, 7:23 p.m. EDT): Let’s turn the position into a covered write if GDXJ slips beneath 42.25 today (see inset, a new chart). Specifically, you should short one August 16th 41 call for each hundred shares you own. Don’t simply bang out a sale on the bid when the stock hits 42.24, since you could get clipped for as much as 0.20-0.25 on the spread that way. Instead, you should be deliberate and relaxed about the short sale of the call, since we are in the catbird’s seat and have little to lose by taking in some option premium at this point. Shoot for a price midway between the bid and offer, and don’t rule out the possibility that GDXJ could snap back above 42.25 even in the process of breaking down. _______ UPDATE (July 30, 2:32 p.m.): _______ UPDATE (2:30 p.m. EDT): I’ve yet to hear from anyone, but a ‘relaxed’ short could have been done anywhere between 2.03 and a current bid/offer of 2.45/2.90. I’ll use a cost basis 2.55, about midway between, unless I hear otherwise.
A subscriber reported success yesterday legging into the 1340/50/60 August 16 call butterfly that I’d advised. He did so 32 times at no cost, as suggested, but it took a $10 move in the stock between legs to get filled so advantageously. His maximum profit would be $32,000 with the stock trading at 1350 come August 16. Since he owns the position without cost, no loss is possible even if PCLN should all to zero or rally to $1000. We’ll do nothing further for now, but I’d suggest that those of you who were unable to buy the spread keep trying. We’ll shoot for a partial profit if the stock rallies $40-$50 in the next few weeks but otherwise do nothing further. I’ve reproduced a chart that shows why our expectation of a $120 rally from current levels, to a 1358.18 Hidden Pivot target, is not exactly farfetched. To that end, a pop above the 1270.59 midpoint pivot would be most encouraging. ______ UPDATE (July 28, 7:46 p.m. EDT): Yesterday another subscriber reported legging into ‘free’ butterfly spreads as suggested. Keep trying for at least one more day if you haven’t yet acquired a stake, since the spread will remain cheap as long as PCLN doesn’t blast off.
I haven’t tracked currencies that closely, but because they tend to move very precisely to Hidden Pivot targets, traders should consider exploiting them whenever possible. Notice how EUR/USD has broken beneath a midpoint Hidden Pivot at 1.34841 after noodling around near that pivot for a few hours on Thursday. This suggests that it is bound for D=1.34197, at least. You can bottom-fish there with a stop-loss as tight as 3-4 ticks. Notice as well that there are two slightly higher possibilities for point ‘A’. The correction targets they yield lie, respectively, at 1.34114 and, worst case, 1.33992. I expect these numbers to work very precisely, so use them in whatever way suits you best. Note as well that a last-gasp rally to p=1.34738 after EUR/USD has fallen a bit would be short-able. _______ UPDATE (July 24, 5:35 p.m. EDT): Yesterday’s short-squeeze feint topped precisely at a midpoint Hidden Pivot (see inset, a new chart) that was originally support but which is now resistance. This price action confirms the pattern we’ve chosen as well as its ‘D’ target at 1.34197. At least one subscriber has confirmed getting short in the chat room. _______ UPDATE (July 27, 10:43 p.m.): Friday’s low occurred at 1.34206 — 0.00009 above our 1.34197 target. Shorts should have covered there, but if you were able to bottom-fish the low and catch a piece of the 144-tick rally that ensued, please let me know in the chat room and so that I can establish a tracking position for your further guidance. _______ UPDATE (July 30, 2:43 p.m.): The futures have breached the lowest of the targets I’d provide from the lesser charts. This implies that a bigger-picture target at 1.32091 is in play. The chart(see inset, a new one) shows this.
The Dollar Index turned higher yesterday an inch from a correction target that had been three weeks in coming (see inset). This portends a bullish change for the intermediate term. The actual target is 79.74, and there is always a chance it will be breached. If so, there’s an alternative target at 79.62, but if it fails as well, especially without a fight, the implication would be more slippage to as low as 78.91, where a key low recorded in early May would thereupon beg to be tested. _______ UPDATE (11:17 p.m. EDT): Yesterday’s low occurred at 79.74 exactly. If the dollar is about to reverse and move higher, it will have to happen here, and now. _______ UPDATE (July 9, 2:33 a.m. ET): The dollar rallied strongly for a few days, but it is still not out of the woods because the move narrowly failed to clear an important ‘external’ peak at 80.38 recorded on 6/26. _______ UPDATE (July 16, 6:55 p.m.): DXY came within an inch of a clear and important Hidden Pivot rally target at 80.60 yesterday (see inset, a new chart). However, it will have to push past it to imply that the rally from the July 1 low (which had been predicted to-the-penny) is more than just a flash-in-the-pan. _______ UPDATE (July 30, 2:53 p.m.): 81.85, here we come!! (See inset, a new chart.)