Friday, March 23, 2012

A Hidden Pivot target at 31.230 evinced little support, shortening the odds of more weakness down to at least 29.355, a key Hidden Pivot support noted here earlier. On the way south, the futures will likely have one more chance to turn around -- at 30.270, the 'D' target of the pattern shown. Its p sibling at 31.680 got crushed yesterday, so the burden of proof will be on bulls as the week draws to a close.  Night owls looking to 'camo' their way short should note that tonight's rally has come up to the exact p midpoint of the bearish pattern shown.

We're slightly long in GDXJ, the Junior Gold Miner ETF, but there's a consolation prize if we wind up scratching the trade at the 22.79 stop-loss advised.  For details, check out the chart accompanying today's GDXJ tout. It identifies a very promising spot to try bottom-fishing again -- a Hidden Pivot support that is a back-up-the-truck number as far as I'm concerned.

We bought 400 shares yesterday when GDXJ bottomed within three cents of a 23.93 correction target flagged here a while back. After selling half the position later in the session for 24.07, we hold two round lots with a profit-adjusted cost basis of 23.79.  Retain the stop-loss at 23.79, since a breach of Thursday's low could spell more downside to 22.74, a Hidden Pivot support whose provenance is shown in the chart.  It looks like a back-up-the-truck number to me, and that's why I'll recommend bidding for 400 shares @ 22.81 bid, no stop; or buying 800 shares via camouflage. I'll help you with this if I'm at my desk with my screen alert triggers, so stay tuned. _______ UPDATE (2:05 p.m. EDT): A rally has put our 200-share position (or multiple thereof) nicely in-the-black, although it's now possible we won't get a chance to buy more shares at fire-sale prices. For what it's worth, the rally was not quite as powerful as it may have seemed, since it has yet to exceed any prior peaks on the hourly chart.  It would take a print at 25.46 to turn the chart bullishly impulsive, and one at 27.34 to negate the 22.74 target.

Thursday's rally was continuing into the night session, promising to reach a minimum 1650.30, the 'D' target of the pattern shown. That much is known. As you can see, however, buyers will need to do just a little better, pushing above the last-gasp peak #1 at 1652.30 recorded before bulls received a drubbing yesterday.  Regardless of how things turn out, leveraging a 'b-c' pullback from just above the #2 external peak would be worth a shot for night owls seeking to get long.  (Click here for information about the upcoming Hidden Pivot webinar and a coupon good for a $50 discount.)

Put the 1412.75 target out of mind for now, but please note that the futures' failure by nearly 5 points to reach that Hidden Pivot is not a healthy sign. Bulls could easily get back on track today with a push merely to 1398.25, but failing that, they could grope their way 20 points lower today before finding traction. Night owls should look for 'camouflage' opportunities to get long via b-c pullbacks from in-between the closely spaced series of peaks labeled in the chart.

[Many who receive my free commentaries each day and who visit the Rick’s Picks forum to share their thoughts are unfamiliar with the forecasts and trading recommendations that only paying subscribers get to see.  I would strongly encourage ‘lurkers’ to try the service free for a week so that they might begin to appreciate the finer and more purposeful advice that lies behind the headlines.  Click here and Webmaster Mike will set you up for next week. Then read the following, a response to a post by ‘Gary L’ suggesting that my permabear bias may be clouding my judgment about trades and investments. RA] Gary, you haven’t taken the Hidden Pivot course, nor have you followed the detailed trading recommendations that I disseminate each day to paying subscribers, and so your impression of Rick’s Picks is likely to be based on the free commentary published daily at this site. However, and as any one of my subscribers would tell you, I focus obsessively on trading and forecasting strictly by-the-numbers. ‘Bullishness’ and ‘bearishness’ aside, for me and many ‘pivoteers,’ it all comes down to observing uptrending or downtrending impulse legs in different time frames. This very simple idea guided me unfailingly during a time when I might otherwise have stumbled badly. In the weekly column I wrote for the San Francisco Sunday Examiner years ago, I dissed the dot-com boom as it played out, never deviating from the shrill warning that this remarkable eruption of greed and stupidity would take many investors down with it. The Examiner’s readers must have seen me as Chicken Little (until the crash, that is). However, at that same time, the customized daily forecasts that I was selling to groups of floor traders on the CBOE and PSE made even Merrill Lynch’s analysts look like pessimists.