Dow Industrials ETF

DIA – Dow Industrials ETF (Last:342.94)

– Posted in: Current Touts Free Rick's Picks

Usually, violent swings make for profitable 'mechanical' trading. In this case, however, the ride south has been marked by heavy chop that's made trading an obvious downtrend as difficult as surfing in a storm. DIA has triggered just one legitimate short along the C-D leg  -- but from the red line rather than the less risky place at the green one where we typically jump aboard.  I am still looking for a tradeable if temporary upturn from around 340, which would be well within the discomfort zone that has cued up so many of our trades in recent months.  As noted here earlier, this gambit will require an rABC-type entry recommended only for those who are familiar with the tactic. _____ UPDATE (Sep 20, 12:52 p.m.): Sellers have pushed DIA well below 340, implying that the next place we might look for a 'discomfort-zone' low would be in the range 335.15-337.40 (visually estimated). if you understand why, I would encourage you to attempt the trade. Here's a graph to help you visualize the set-up. ______ UPDATE (Sep 20, 10:04): The trade worked, but because it entailed an especially  challenging entry and only one subscriber reported doing it, I have not established a tracking position. Now let's see if the little bugger can make it up into to the gap between 342.16 and 345.31. _______ UPDATE (Sep 21, 10:34 p.m.): The little bugger's rally failed near the middle of the gap, setting up a nice 'discomfort zone' short for any Pivoteer who was eager to trade. The subsequent downtrend projects to at least 336.90 (60-min, a= 342.16 at 10:30 a.m. on 9/20 , b=335.99 and c=343.07. _______ UPDATE (Sep 22, 9:36 p.m.): The rally had shorts mildly on the run at the close. It also negated the short-term bearish pattern, albeit

DIA – Dow Industrials ETF (Last:346.70)

– Posted in: Current Touts Rick's Picks

The downdraft in the final hour seriously damaged the bullish look of DIA's hourly chart, but it's still possible bears will turn gutless, as they usually do, as the week unfolds.  There are so many potential point 'A' highs  we could use to plot a 'Richie'-type turnaround, so we won't try.  Instead, I'll suggest looking for a low down around 340 with which to set-up an rABC trade. This one's for experts only, since the white space encompassing the trade is as vast as the Pacific.

DIA – Dow Industrials ETF (Last:350.75)

– Posted in: Current Touts Free Rick's Picks

The pattern shown, with a 363.15 rally target that differs slightly from the one we've been using for months, has exuded good karma all the way up. Notice that it triggered two fetching 'mechanical' buys in places where most bulls would have been paralyzed by fright. That's why these trades work, and why we should expect the rally to continue at least to D. As before, we will want to short the bejeezus out of a print at or near that Hidden Pivot, but without letting hubris cloud our judgment concerning whether we've seen The Top. If you butterflied calls a while back, please let me know in the chat room, since they should be coming home to roost shortly. ______ UPDATE (Aug 31, 11:05 p.m.): Although three weeks of patty-cake at p2 has somewhat dimmed our 363.15 lodestar, it hasn't quite snuffed it. A short there is still warranted in any event, but I wouldn't attempt a 'mechanical' buy unless DIA swoons precipitously to the green line. _______ UPDATE (Sep 4): Make that, four weeks of patty-cake at p2. _______ UPDATE (Sep 8, 9:06 p.m.): Bulls ran out of gas trying to stay aloft for yet more gratuitous head-butting of p2. Let's see if bears can seize the advantage by pounding DIA hard ahead of the weekend. If so, it would be behavior we haven't seen in a very long while.

DIA – Dow Industrials ETF (Last:353.45)

– Posted in: Current Touts Free Rick's Picks

Last week ended with a push slightly above the top of a trading range that has contained DIA since May. As far as breakouts go, it is so undramatic as to be unworthy of that description. However, since a finishing stroke to the 364.31 rally target has never been in doubt, we'll infer that DIA is at long last on its way there. Because of the large expanse of time consumed by this lethargic bull trend, the only option strategy that would have worked all along was a covered write.  Meanwhile, any put butterflies we may have bought along the way would have expired worthless, but they served as a cheap way to leverage the unthinkable. We can still butterfly the rally target with calls, but I'd suggest going out no further than six weeks and paying no more than 0.20 per 'fly. If you are unsure of how to do this, there is a recorded lesson on butterfly spreading accessible on your account page. ______ UPDATE (Aug 21): The bull is beginning to look winded. Although that doesn't necessarily mean 364.31 won't be achieved, we should still be alert to the possibility of a lazy rollover that mutates into a bull-killer. If DIA hasn't traded above 352.70 by Thursday afternoon, nor below 350.00, consider buying a few Sep 30 $10 put butterflys centered on the 340 strike for 0.10 or less. A free mini-course on butterfly spreading is accessible via your account dashboard. ______ UPDATE (AUG 23, 11:19 p.m.): Today's lunatic leap made DIA seem like less of a laggard. If it continues, a decisive push above p2=354.45 of this pattern would put D=356.82 in play. That would be a downpayment on the still-viable 364.31 target of the larger pattern noted above.

DIA – Dow Industrials ETF (Last:350.63)

– Posted in: Current Touts Free Rick's Picks

The Dow Industrials have been screwing the pooch for nearly four months. That's when DIA first popped through a midpoint resistance at 335.00 that is associated with a long-term rally target at 364.31. However, this ETF vehicle has since failed to break decisively above p2=349.65, keeping the outcome in limbo and making DIA a very unappetizing trade, other than for covered writes and similar short-premium option positions. You can see for yourself that the graph provides little reason to think the target won't be reached. Absent a game-changing plunge exceeding mid-June's 333 low, we'll keep this tout on the back burner. _______ UPDATE (Aug 5, 10:56 p.m.): Zzzzzzzzzzzzzz.

DIA – Dow Industrials ETF (Last:350.57)

– Posted in: Current Touts Free Rick's Picks

Our focus for quite some time has been on a 363.15 rally target (or possibly 364.31, the 'D' of a larger pattern dating back to November 2020). Ordinarily I don't try to correlate targets of different vehicles, but in this case, charts for DIA and QQQ look so toppy that I can only caution against being too confident about a further rally in the Dow to 'D'. Actually, the current stall has occurred at p2=349.65 of the larger pattern, making it potentially subject to Matt's Curse. Subscriber Matt Barnes' theory holds that stalls, when they occur precisely at p2, produce reaction moves down to 'C' or lower. Here's the bigger pattern showing the stall and the 364.31 target.

DIA – Dow Industrials ETF (Last:347.97)

– Posted in: Current Touts Rick's Picks

Bulls spent the week in thin air before exhaustion set in on Friday. Will the downtrend get legs?  The best way to tell is to watch minor corrections, since a growing tendency to overshooting their 'd' targets will imply that the selling is getting stronger. Correspondingly, we should see rallies fail to reach their 'D' targets or even Hidden Pivot midpoints. The 363.15 target given earlier still obtains, and DIA would in fact become a fetching 'mechanical' buy if the pullback comes down to x=340.30. For now, we'll just spectate. _______ UPDATE (Jul 19, 6:37 p.m.): Very heavy selling drove DIA well below the mechanical-buy 'sweet spot' at 340.30. However, using the same a-b coordinates, I allowed the trade anyway when a still ongoing rebound triggered it at 339.68 in the final seconds of the session.  This gambit is riskier than I'd prefer -- not because the bounce won't be sufficiently robust to reach my profit-taking level at 341.99, but because this could conceivably happen in the dead of night. The E-Mini-Dow has already rallied 300 points off the low and would signal a profitable exit if it hits 34,109. Whatever happens, you should plan on taking the entire position off at p=341.99, provided you have access to DIA in off-hours trading; or by shorting the E-Mini futures 'against the box'. As far as I can surmise from discussion in the chat room, no subscribers took the trade. _______ UPDATE (Jul 20, 9:20 a.m.):  The trade worked precisely as anticipated when DIA topped at 342.28, an inch above the red line, in the middle of the night.  Also as expected, it  retreated sharply thereafter, with the E-Mini Dow following exactly the same path. If you did the trade using 400 shares or four contracts, you should be out of it

DIA – Dow Industrials ETF (Last:348.78)

– Posted in: Current Touts Free Rick's Picks

DaBoyz goosed shorts Friday to kick off an unmistakable lurch toward a 363.15 target that has been beckoning for several weeks. (A similarly bullish target at 365.67 had teased bulls since May but was negated by mid-June's fake breakdown.) I see no particular opportunities at the moment and note that even the obvious one, a 'mechanical' buy on a pullback to x=340.30, was denied us when DIA's engineered plunge last Thursday failed to touch the green line where we like to position 'mechanical' bids.  We should expect little more generosity on the way up, but since we know where DIA is headed, it should be fairly easy to grab short hops along the way. Stay close to the chat room or activate 'Notifications' on your account page to stay apprised.

DIA – Dow Industrials ETF (Last:347.94)

– Posted in: Current Touts Free Rick's Picks

The  chicken-hearted poke above p=347.92 that ended the week was unconvincing for anyone hoping the 363.15 target with which it is associated will be achieved. Price action at the midpoint pivot is always crucial to such assessments, and the action so far says the bull cycle  begun from 332.68 on 6/18 is weakening. Despite this, my expectation is that the Dow will get pulled higher by the lunatic exuberance of some of the other indexes, notably the S&Ps and the Nasdaq.  If the effect is strong enough, it would generate a two-day DIA close above 347.92, an event that would warrant shifting our focus toward 363.15, a modest, 4% climb from here.

DIA – Dow Industrials ETF (Last:339.44)

– Posted in: Current Touts Free Rick's Picks

Elsewhere on the home page, I've suggested taking last week's defenestration of the S&Ps and IWM with a grain of salt, since it is just the chimps shifting money amongst the various "themes" they determine with a toss of a dart each month. Even with the Guvmint force-feeding dollars into stocks, real estate and the consumer economy, it takes gargantuan sums to hold the shares of trillion-dollar companies like Apple, Amazon, Google and Microsoft continuously aloft, never mind move them higher. That's why Friday's breach of C=335.20 (see inset) is unlikely to be the start of a bear market, but rather a scripted way to economize on the continuation of a bull market whose demise is long overdue.  Well, yes, it's always possible a bear market has begun, but we'll likely do better looking for DIA to recover its footing somewhere in the range 320-327.  I am not using Hidden Pivots to project lows there, by the way, but rather the common-sense assumption that the important March 25 bottom at 320.62 is likely to hold. _______ UPDATE (Jun 22, 11:46 p.m. ET): After last week's decisive breakdown, DIA has rallied to trip a 'conventional' buy signal at x=339.49 shown in this chart. I don't much trust the signal, and so I am not recommending a trade. We rarely initiate one on this kind of signal, but I'll warm to the idea if bulls take on midpoint resistance at p=347.92 [corrected] with gusto.