Tuesday, September 25, 2012

I noted here the other day that Google-gone-loco looked strong enough to drag Apple higher. Not yesterday, though. Still, I've flagged a Hidden Pivot in today's update for GOOG that I expect to show some stopping power -- and precisely.  Check it out if you're interested.  I've deliberately omitted a chart so that you can figure this one out for yourselves.  Hint:  Try the 30m.

The December contract looks to be revving for a flight to 1813.40, the 'D' Hidden Pivot of the pattern shown. A close above the 1783.30 midpoint pivot with which it's associated would make the target all but a lock-up, and the best place to board via camouflage would be on a pullback from just above the external peak at 1780.50 (see inset).

Corrective weakness met support yesterday at the 508.33 Hidden Pivot shown, but if it fails, look for more downside over the near term to at least 502.91. Speculative buying would be in order there, stopped as tightly as 502.79. Looking at a bigger picture, the bull trend appears healthy and robust, since 'external' peaks are getting surpassed with each new thrust. A crucial test awaits, however, a little more than 10% above, near peaks around 555 recorded in February.  You can learn to “camouflage trade” yourself.  Click here for a free trial to Rick’s Picks.

Seven straight days of tedium have provided little in the way of trading opportunities.  The (very) minor trend was bullish at the bell, but a night owl would have to be bored out of his mind to pounce on it.  If the futures ever lurch back into gear, however, they should be presumed bound for a minimum 1470.00, a midpoint resistance associated with a sibling 'D' target at 1496.25 (see inset).

H.L. Mencken famously wrote that no one ever went broke underestimating the intelligence of the American public.  With kids lining up at Apple stores last week to buy the latest iPhone, mightn't that be a timely cue to short Apple shares for around $700? To us, at least, it seems pretty stupid to pay Apple’s inflated prices when one can get a perfectly good, discounted Android phone from Samsung for half the price. And speaking of Samsung, we think Apple may have darkened its own karma when they sued their Korean competitor over a few trivial patents, extracting  a billion dollar settlement  (and never mind that, on appeal, Apple is seeking yet another $700 million from the same lawsuit). World-beating companies that pride themselves on innovation shouldn’t have to sue the competition for billions of dollars over design features that any Carnegie Mellon or Pratt sophomore would have incorporated in a phone-display schemata. So are we shorting Apple shares?  Quite the contrary, actually. On Friday, even as we advised subscribers to cash out of a winning AAPL bull calendar spread initiated well below current prices, we were attempting to replace it with some Nov 730 -Oct 730 calendar spreads legged on for $8 or less.  The spread would yield terrific odds if Apple shares were to rise by another $30 over the next few months. (Click here for a free trial subscription that will get you real-time notifications.)  Apple looks like a shoe-in to go at least somewhat higher in the days ahead, having finished last week above $700 for the first time. And yes, we are well aware that the company has embarrassed itself by releasing a map application with the new iPhone that totally sucks compared to Google Maps.  Of course, the kids who are lining up to