Thursday, November 15, 2012

Our 40-to-1 horse, Facebook, picked up five lengths on the field with Thursday's explosive, crowd-pleasing surge. Considering how strong the bearish tide was yesterday, it would appear that DaBoyz must "know something."  If and when the news behind this move hits the tape, we can take pleasure in saying we knew all along that it was coming. Click here to sample Rick’s Picks free next week. For the record, we have a feeling it won't be a dull one.

The promise of the sort-of impulsive AB leg is marred by its narrow failure to exceed the look-to-the-left external at 1739.70. Nevertheless, if we were to give the bull the benefit of the doubt, the pattern projects to 1754.00, subject to midpoint resistance at 1735.80. That's 1.70 above Thursday's high, but if the pivot is surpassed by, oh, 1.10 or more, I'd rate a run-up to the target an even-money bet.

GORO is a popular stock in the chat room, but I don't much track it because, well, because it brings up unpleasant memories of my childhood dentist, Dr. Gorodetzer. I never had Novocaine or gas because my father, a physician, did not trust dentists to administer anesthetics. (I was also the only kid on the block who wasn't allowed to view my feet in the fluoroscopes that were popular in shoe stores during the 1950s.) With that out of the way, and for what it's worth, the stock is closing on a minimum downside target at 12.22, the Hidden Pivot 'D' of the pattern shown. Unfortunately, any support that it evinces is likely to be for naught, since yesterday's destruction refreshed the bullish impulsiveness of the weekly chart by exceeding an 'external' at 12.75.  Might I suggest giving me a nudge in the chat room if whatever rally that occurs from here looks shortable via camouflage?  Hidden Pivot logic suggests this opportunity might arise on a rally back up to the 17.94 midpoint pivot. _______ UPDATE: The stock plummeted to 12.13, just 9 cents beneath the target identified above, before DaBoyz applied the squeeze. Their rally got all the way to 13.71 -- and more power to you if you got profitably involved on the basis of my forecast.  Now, in the unlikely event GORO takes out the 13.44 midpoint resistance of the pattern shown, it could hit 14.23 in a romp. ________ UPDATE (November 19, 9:00 p.m. EST):  The stock is going higher, since it not only handily exceeded the 14.23 target flagged above, it generated a fresh impulse leg on the lesser charts in the process.  Camouflageurs looking for the next prospective boarding opportunity should focus on the 15.56 'external' recorded on 11/12.  It is easily visible on

If there's to be a hopeful sign, look for it at 439.27, the Hidden Pivot midpoint of a pattern that projects to as low as 348.74. My hunch is that a breach by as little as perhaps 1.50 points would send the Gold Bugs Index down to lows made two years ago in search of support. They come in around 380 and outweigh any Hidden Pivot supports that would apply beneath the midpoint.

We remain short one contract via a tracking position with a cost basis fattened to 1470.00 by theoretical profit-taking thus far.  I am still suggesting an impulse-leg stop based on the hourly chart, but I'd suggest reviewing the recording of Wednesday's tutorial session to make sure you know what this means. (Note: I can arrange a viewing for Hidden Pivot webinar grads who are no longer signed up for the weekly sessions.)  To guide you in the meantime, let me suggest a stop-loss just above 1399.75 if you're swinging for the fences, but above 1388.00 if you're playing it more conservatively.  The significance of both price points is shown in the chart.

What I didn't mention about IBM in today's commentary is that if the stock does fall to the 176.77 target or perhaps even slightly lower, it will do some very heavy technical damage to the weekly chart. Pivoteers may have noticed that that would refresh the chart's bearish impulsiveness by taking out at least two important 'external' lows.  At that point, evidence in this bellwether stock of the gestation of a larger bear market would be overwhelming -- not to mention, a dark cloud over the holiday shopping season.  Camouflageurs should look to short the move on a rally back up to 187.38, the p of the pattern.