Friday, March 2, 2012

SLW – Silver Wheaton (Last:34.94)

– Posted in: Current Touts Free Rick's Picks

'Dueling impulse legs' cede an edge to bears at the moment, although the most recent impulse leg (see inset) suggests night owls will enjoy better odds if they trade from the long side. The pattern shown projects to 39.52, and it should be regarded as no worse than an even-odds bet because the p sibling at 38.94 with which it is associated has already been exceeded to the upside by a decisive 6 cents. Since action at the opening bell cannot be precisely predicted, I won't offer explicit instructions for buying the stock. However, the 38.59 'D' target of the small corrective pattern shown is where I'd look if SLW opens quietly Friday morning.  Note that the downtrend halted on Thursday at the precise Hidden Pivot midpoint of the pattern. _______ UPDATE (10:39 a.m. EST): The stock opened very unquietly on a gap slightly below 38.55, so we did nothing. SLW continued to head lower, breaching the 'p' midpoint of a pattern projecting as low as 36.42. This is bad news, but the outlook would improve if the stock can push past a small 'external' peak at 38.43 in the next day or two. _______ UPDATE (March 5, 11:35 a.m. EST): The stock has crashed the support, apparently bound for a worst-case Hidden Pivot target at 34.53.  The correction will be a 15 percenter at that point -- a good time to establish a long position.  Accordingly, I'll recommend bidding for four June 40 calls with the stock 34.60 or lower.  ______ A FURTHER UPDATE (March 6, 9:58 a.m. EST): We bought four June 40 calls for 1.27 just now when the stock plunged to within a penny of the 34.53 Hidden Pivot I'd flagged as a worst-case low. In fact, there is now a new worse-case possibility at 34.07,

GCJ12 – April Gold (Last:1721.80)

– Posted in: Current Touts Rick's Picks

Comments in today's editorial about Silver's serene, steady recovery from Wednesday's shock-and-awe selloff apply to gold as well, since there is a precise benchmark similar to the one cited in Silver that we can use to gauge the strength of the bounce.  It lies at 1740.00, nearly $20 above current levels, and is shown in the chart. More immediately, as of around 7:45 p.m. EST the futures were having some trouble staying aloft, and the most recent peak, 1724.40, noticeably failed by a few ticks to get past an 'external' high.  Be that as it may, there is an unfulfilled, minor rally target at 1735.70 that we can use as a minimum upside objective for now.  The 1723.90 midpoint has been impaled, trampled and otherwise abused, but night owls looking to get long should try to do so following a consolidation or B-C pullback from above it.

ESH12 – March E-Mini S&P (Last:1376.75)

– Posted in: Current Touts Rick's Picks

The futures look bound most immediately for 1380.75, a Hidden Pivot that I identified during yesterday's impromptu online trading session and posted in the chat room shortly thereafter. The move is too mature for a camo entry attempt, although you could try shorting at the target with a stop-loss as tight as three ticks. Be aware, however, that if the stop is hit the futures would be signaling more upside to the 1396.25 target of a pattern that comes from the daily chart: A=1296.00 (1/30); B=1358.00 (2/15); and C= 1334.25 (2/16).

Gold, Silver Appear Unintimidated

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

Precious metals appear to be recovering nicely after Wednesday’s punitive selloff. Although we initially assumed it might take a few weeks for gold and silver to build a base for the next moon shot, yesterday’s price action hinted that bullion quotes could be off and running much sooner.  To be sure, the price action yesterday just inches from ground zero was relatively timid, with small gains driving the markets.  However, that was to be expected, given the ferocity of the previous day’s plunge. It would have scared hell out of many investors, turning them cautious for the time being. But perhaps not for long. What was most encouraging about yesterday’s rally was its calmness, with relatively few of the whoops, feints and dives that characterize nervous markets. In fact, bulls made their ascent the way an experienced rock climber would scale an imposing cliff – i.e., one secure handhold/foothold at a time. From a technical standpoint, the chart above shows what Comex May Silver must do before we assume that the trauma from Wednesday’s shock-and-awe selloff  has mostly worn off. If you happen to trade the metals, we’d recommend setting an alert a tick above the highlighted peak at 36.185; for that is where bulls will once again have the bad guys on the run.  The peak may not look like much – in the parlance of our proprietary Hidden Pivot Method, it is known as a “peak along the wall” -- but it can be quite useful for purposes of gauging the determination and confidence of buyers. And if they’ve got the guts we think they’ve got, they should be able to push the futures through the resistance today or perhaps Sunday night with little or no evidence of deflection.  [Follow the action from ringside with a free trial