April 2012

GDXJ impulsed bullishly with a gap-up opening on Friday, but the move, too powerful for our kind of stealth,  is likely to create a Catch-22 situation for anyone attempting to enter on Monday at the calculated 'x' of the pattern shown, 23.44. If 'x' makes it too easy to get on board, it will probably be a bull trap; but if the follow-through 'C-D' rally is as strong as we should prefer, then GDXJ may skip 'x' on the way to the 24.130 target. In any case, using the sketch I've provided, any trade today will have to be catch-as-catch can.  I'll establish a tracking position only if at least four subscribers report getting aboard.

The picture-perfect 'camo' pattern shown in the chart signaled a long entry at 31.235 for Pivoteers who were on the alert Friday morning. Since my tout was not likely sufficiently explicit to have done much more than pique your interest, however, I won't be establishing a tracking position. (Also, as a practical matter, a 'camo' entry on a pattern of this size would have entailed initial risk of $500 per contract. Lowering theoretical risk to our rules-based threshold of $70 (or so) would have required entry on a chart of lesser degree.) From an analytical standpoint, night owls should note that the 'C-D' leg has already exceeded its 31.335 mispoint resistance, implying that this burst will continue to at least 31.535, its 'D' sibling. Any higher would suggest bulls are eager to run as the new week begins. _______ UPDATE (12:22 p.m. EDT): Interesting coincidence, but the above tout went out Sunday evening exactly as May Silver was achieving its ill-fated overnight high. Unlike gold, however, the subsequent plunge cannot yet be called a swoon because the lost value has yet to be recouped.  The action is short-term bearish, since it generated a downtrending impulse leg on the hourly chart.  However, if Silver is to get back on a bullish track, we should see a harbinger of this in the form of a rebound from the midpoint Hidden Pivot of (30m) a=31.380 at 2:30 a.m. on 4/30; b=30.550 at 10 a.m., and c=?.

A 1439.50 rally target flagged here last week would become an odds-on bet if the futures close above its midpoint sibling, 1396.00, today for a second consecutive session. If you're looking for a way to board and are proficient at 'camouflage' entries, I suggested trying to leverage a 'B-C' pullback from just above either of the two small 'external' peaks labeled in the charts.  (And yes, I'm aware that peak #1 doesn't quite cut it, at least not on the hourly chart.)

We hold a single contract with an effective cost-basis of 1641.50.  This is a tracking position for your further guidance, since two subscribers confirmed entry on the terms spelled out here Friday. The futures appear to be consolidating above the trendline we'd focused on, and although that will give us more leeway to let paper profits run, it is never wise to forsake a stop-loss. Accordingly, I'll recommend placing one for today at 1649.10, which is where the hourly chart would turn bearishly impulsive.  The price point is shown in the inset. _______ UPDATE (11:43 a.m EDT):  We exited on a gratuitous swoon to 1645.10 for a theoretical gain of $360 per contract. We'll try again when an irresistible opportunity like the last arises. It is not a positive sign that the futures could not hold the trendline.

We wrote here recently that as Apple shares go, so goes the U.S. stock market. How has the stock fared?  Last week there was quite a bit of excitement when the broad-tossers who manipulate the stock for a living short-squeezed the bejeezus out of it after the close, leveraging a strong earnings report that could have surprised only Wall Street’s clueless analysts. Moments after the news hit the tape, AAPL gapped up 9% in a blink, recouping two-thirds of the losses it had suffered the previous two weeks, when it plummeted $90 from an all-time high at $644.  From a technical standpoint, what was interesting about the  decline is that it reversed from within 29 cents of a “Hidden Pivot” correction target we’d disseminated to subscribers a few days earlier. For if the stock had exceeded that number by more than a couple of dollars, it would have held bearish implications for the short-to-intermediate-term. However, because the pivot survived, there was no way to judge the mettle of bulls until Apple rallied out of the hole. This it did, in spectacular fashion, with last week’s gargantuan short squeeze. The goosing instantly added $50 of value to each share of the world’s most valuable company. Nothing like a little volatility to keep the crowds coming back for more, right?  Putting aside the comical spectacle of a $600 billion whale flopping around wildly in NASDAQ’s bathtub, the rally put Apple shares in play once again as a bull-market bellwether. That said, we have our doubts that new all-time highs will be achieved any time soon. Notice in the chart how last week’s gap-up rally, powerful as it was, narrowly failed to surpass peak #1.  If buyers had more guts, shouldn’t they have taken on that last, niggling resistance before settling back triumphantly?

May Silver has trampolined $1.30 since bottoming earlier this week at 29.925, three ticks from a well advertised Hidden Pivot at 29.940.  If you're not on board already, look for subtle 'camo' opportunities on the 5-minute chart that occur within the framework of the correction from yesterday's 31.260 high.  Looking at a somewhat bigger picture, the next surge would need to carry above the tiny external peak at 31.685 shown in the chart to refresh the bullish impulsiveness of the larger intraday charts.

The June contract has turned lower Thursday night after coming within inches of our all-purpose trendline. The move remains bullishly impulsive despite the so-far mild selloff, and its power should not be doubted, the thrust having exceeded no fewer than three external peaks. Camouflageurs should be prepared to buy-stop their way aboard via the 5-minute chart if a pattern like the one shown plays out on Friday. _______ UPDATE (2:23 p.m. EDT): The trade worked exactly as sketched. Entry by my instruction would have been at 1654.30, with a partial profit on 50% of the position at 1657.50, and another 25% at 1663.90, the D target. If I hear from two traders who got long according to the tout, I'll establish a tracking position for your further guidance.

GDXJ is in play once again for reasons anticipated in Thursday's tout. Check out the tout and the accompanying chart to see how a long entry can be approached.  Click here for a free 7-day trial that will put you at ringside for this one.

GDXJ has popped above the 22.91 'external' peak flagged here yesterday, so we should try boarding via the next 'b-c' pullback on the hourly chart. If it comes from above 22.13, however, GDXJ's strength will be too obvious for a stealth entry. Under the circumstances, I'd suggest looking for your entry 'X' on charts of 5-minute degree or less. For now, though, assuming the retracement comes from above peak #2, buy 400 shares at an 'X' trigger like the one shown, stopping it below 'C'.  Please let me know in the chat room if the order fills, since I'll establish a tracking position if two or more subscribers have gotten aboard using the tactic described above.