Tuesday, April 17, 2012

Although my bias in Gold is bearish at the moment, today's tout contains detailed instructions for using camouflage to get long in June Gold if bulls should regain on the offensive.  I've also flagged a potentially great opportunity to take another risk-free gamble on Silver Wheaton, which may be near the end of its long dirge. Take a look at the chart accompanying today's SLW tout if you want to be convinced.

With a 4-6 day horizon, my bias is bearish, since the 1681.30 peak of last Thursday's spike rally failed to exceed any external peaks on the larger intraday charts.  However, so that we won't be caught napping if bulls regain the offensive, I'll suggest paying close attention to the authoritative trendline shown in the chart.  Over the course of Tuesday's session, it will come in anywhere between 1677.60 earlier in the day to 1676.00 at night. Using the 5-minute chart or less, camouflageurs should jump on the first signaled 'X' that occurs following a move above the line. This trade has a high probability of working, so I'd suggest keeping a close eye on the trendline for the remainder of the week.

Yesterday's soporific performance left nothing to entice, let alone compel, us to trade. If the futures are momentarily too tired to try to out-think traders -- how refreshing would that be? -- we might look for them to drift lower until they meet with the obvious support of the 1332.75 low recorded on March 6. Alternatively, buyers would need to goose this vehicle above 1385.25 to turn the hourly chart unambiguously bullish once again. _______ UPDATE (11:32 a.m. EDT):  This morning's manic short-squeeze has pushed the futures to a so-far high of 1384.50 -- about as far as they can go without looking impressive or signaling anything of technical significance. Assuming DaBoyz seize the advantage an eventually maneuver this vehicle above the 1385.25 threshold noted above, we'd be looking at a further run-up to 1394.50 (15m, A=1353.25 on 4/10, and B=1388.50 on 4/12).  Once 1385.25 has been surpassed, a pullback to the p midpoint at 1376.75 should be regarded as a great buying opportunity -- presumably via camouflage.

The 29.355 target noted here earlier should continue to serve as a minimum downside target for the near term. Oscillations around the 'p' midpoint associated with that number have now stretched to a month, implying that bulls are not going down without a fight.  Although that's encouraging for the future, it won't necessarily prevent a washout low in the days ahead.

Europe’s bankers will need to think really big the next time they try to construct a proper “mother of all firewalls.” A nearly trillion-euro package that was on the table a few weeks ago would combine €440 billion of uncommitted funds from an existing credit “facility” with  €500 billion pledged toward a new one. Those may sound like big numbers, but they evidently were not big enough to prevent market forces from roiling Europe’s stage-managed bond markets last week. The result was a surge in yields on Spanish debt  that spooked U.S. stocks, among others,  into their worst weekly decline of 2012. Although the world’s bourses had celebrated in the weeks leading up to and immediately after the February bailout of Greece by central banking’s wizards and alchemists, stocks have been falling steadily since the beginning of April. Clearly, the specious extravagance of a trillion-eurofund doesn’t buy much peace of mind in financial circles these days. That's notwithstanding the obvious fact that the countries charged with funding the "facility" would have to pony up only a small fraction of the marquee sum. As much should be clear to all the players, since even the ostensibly solvent likes of Germany, Holland and Finland don’t have that much good money to throw after bad, nor the will to import austerity by-the-empty-truckload in support of a doomed euro and a bunch of sovereign deadbeats. Private Lenders Flee Spain For their part, U.S. stocks looked dismal last week, with the Dow off 1.6% and the S&Ps down 2%.   However, such relatively mild selling may prove to be just a warning tremor if Europe’s debt crisis is about to return to the headlines.  On Friday, investors’ fears ratcheted into the red zone when it became apparent that a tidal surge of borrowing from the European