Tuesday, April 3, 2012

Silver's hourly chart looks better than Gold's, with bulls winning each 'duel' by creating cleaner, more decisive impulse legs. That's why my bias for bullion will be bullish on Tuesday. Please note, however, that the futures could stall when May Silver hits the rally target flagged in the tout.

Silver vaulted energetically past the 32.680 midpoint resistance shown in the chart, implying that its 'D' sibling at 33.730 has become an odds-on bet. Camouflageurs should look for a handhold by way of a B-C pullback that occurs relative to any one of the external peaks recorded in mid-March on the way down.

Price action in recent days leaves something to be desired, since, on the hourly chart, the bearish impulse legs have been somewhat more powerful than the bullish ones.  Despite this, the bullish pattern shown in the chart, even with its sausage 'B', has too much visual appeal to ignore.  The 'p' midpoint lies at 1681.60, but it was unclear late Monday night whether the futures were in distribution or consolidation at that level. If the latter, and if it's apparent before the opening, you should infer that the futures are developing thrust for a move to 1716.50, the 'D' target. Note in the chart that there's a very subtle 'external' peak at 1688.90 that could be useful for camouflageurs trying to leverage the upside. ______ UPDATE (3:31 p.m. EDT): It was distribution. The futures went no higher than 1682.70 before DaBoyz pulled out the rug, sending this vehicle plummeting to a so far low at 1640.20.

The 1425.5o (shortable, stop 1426.25) rally target given here earlier is still my minimum upside objective for the moment, although progress toward it has been too erratic for all but the nimblest traders to ride.  The 'p' midpoint associated with the target lies at 1406.00, and that's where I would suggest that camouflageurs try to get aboard on a pullback, since buying bullish feints could prove even trickier to grab.  Notice that a second Hidden Pivot at 1406.50, a 'd' support,  makes bottom-fishing at that level even more attractive. _______ UPDATE (3:37 p.m. EDT):  The futures bounced, all right -- but from 1405.25, after  the damage had already been done to the supports flagged above. The ensuing weakness and intraday low at 1399.50 are devoid of technical meaning, however, since the move was not impulsive even on the 30-minute chart.  Bottom-line: today has been nothing but noise.

With last week's rally, the broad averages turned in their best first-quarter performance ever. Supposedly, it was upbeat data on consumer spending that helped push the rally into the record books. But if consumers are actually starting to loosen up – using credit, of course, since household incomes have been stagnant --  the evidence is nowhere to be seen. The nation’s retail landscape in fact remains blighted with boarded up stores and gangrenous malls. Last week, Best Buy became a candidate for the death-watch list with the announcement that it plans to close 50 stores and lay off 400 workers as part of a plan to save $800 million in recurring costs. The consumer electronics giant also plans to move away from the big-box format that helped put so many competitors out of business. Now Best Buy is itself the victim of an even bigger player, Amazon, which, with free shipping and no sales tax, can meet or beat any price Best Buy can offer.  How are you going to compete with that?  Answer: You can’t. And that means that the closing of 50 of Best Buy’s 1100 stores could be the beginning of the end, just as it was for Borders and Blockbuster when they began to shrink to compete more efficiently with, respectively, Amazon and Netflix. Best Buy’s retrenchment will not be welcome news for commercial real estate developers, who have yet to recover from an unending stream of big-box closures, including Comp USA, Borders, The Great Indoors, Circuit City and Linens ‘n Things, to name some of the more recent ones. Their bankruptcies have glutted the market with more space than could be absorbed in a decade -- and that’s assuming there are new businesses ready to move in that can pay the rent on showrooms the