September 2012

With SLW falling hard, we remain long -- but risklessly so, since the eight December 40-45 call spreads we hold were legged on at no cost.  From a technical standpoint the stock seems likely to fall to 36.99 if it takes out D's sibling midpoint at 37.99.  Both Hidden Pivots are shown on the chart, within a pattern looks sufficiently compelling that I'll advise adding to our long position with a 37.03 bid for 400 shares, stop 36.89, day order. _______ UPDATE (September 28, 1:10 a.m. EDT):  The stock fell to 36.33 before trampolining higher, stopping us out for a loss of about $60 plus commissions. We still hold the call spreads and can simply sit tight for the time being. Because the downtrend exceeded a clear 'D' target, bulls will need to push above the recent peak at 40.34 to get out of jeopardy.

We hold no position officially, assuming I don't hear from anyone who acquired eight Nov 730 - Oct 730 call spreads yesterday as advised.  I'd suggested an $8 limit on the order, but with Apple plummeting the calendar spread could have been purchased for less.  We'll continue to bid for the spread,  but paying 7.50 or less, only if no one reports having bought it already.  Technically speaking and from a Hidden Pivot standpoint, the low of yesterday's 18-point dive precisely achieved the 673.05 target shown.  That means that if the stock fails to reverse from here, we should infer that it's developing a magnetic affinity for a key structural low at 656.00 recorded on September 12.  _______ UPDATE: Prices reported for the call spread ranged as low as 6.80, but I'll use 7.00 as a cost basis. Apple is on thin ice and must hold above the September 12's 656.38 low to avoid creating a nasty, bearish impulse leg on the hourly chart. It did so earlier this month, only to reverse and rampage higher, but a second bear trap in two weeks seems unlikely.  A bull trap instead? It hasn't happened in eons, but we should at least be prepared for it.

The weekly Hidden Pivot tutorial session has been rescheduled to Thursday morning, since I will be observing Yom Kippur, the Jewish Day of Atonement, until the sun has set on Wednesday.  May all of you who observe the holiday have an easy fast.  Those who will be trading as usual should take a good look at today's Google tout, since it contains a chart and analysis that could hold very significant implications for the market as a whole. Although I've never considered GOOG to be as important a market bellwether as AAPL, it could prove to be the mine canary of the moment, since it, not Apple, has led the stock market's recent rampage.

Days like yesterday could cast doubt on a prediction made here a short while ago -- that the Dow Industrials are about to embark on a 1400-point rally.  We still expect this to happen, although when we try to think it through logically it makes no sense whatsoever.  As why should it, given that the global economy is presently sustained by little more than lies, political corruption, smoke and mirrors? Even natural winners like Australia and Brazil appear to have embraced the brazen fraud of monetary stimulus. Obviously, they’re trying to gain an edge. But on whom?  An oddity is that, unlike in the late 1920s, talk of punitive tariffs has been relatively muted. Have politicians finally taken to heart the law of comparative advantage?  Probably not. All they know, assuming they know anything, is the law of the jungle. Perhaps they’re simply resigned to the fact that no nation that exports manufactured goods can ever hope to out-cheat China.  For their part, the Chinese have at least spared us the agony of having another Smoot-Hawley tariff grind its way through the D.C. sausage factory. In the meantime, and putting yesterday’s drubbing on Wall Street aside, the U.S. stock market continues to work its way higher. But 1400 points higher?  The very idea of it sent “Mega-Bear” into overdrive yesterday in the  Rick’s Picks forum. “How about screaming, short-term, WAY-overbought technicals,” he asked, “like MACD, RSI and Bollinger bands”?  To be frank, we don’t put much store in such stuff, since none of it has worked very well since this Mother of All Bear Rallies began in March 2009.  What we do trust – completely – is the bland proprietary indicators of Hidden Pivot Analysis.  They are in fact the reason why, on September 19, when the Dow Industrials blew

[We've just received the following from our bird flu expert, Erich Simon, and the news is not good. If you've been tracking this issue, or perhaps even preparing for a pandemic, his latest note is a must-read.  At bottom, I've appended Erich's instructions for creating an air filter for a bird flu shelter. RA] Based on a 'shortened'/abbreviated test procedure on the lung tissue of one of the deceased Saudi nationals, the two Corona's, the latest from SA and the 2002-03 SARS CoV from China, are 99.5% IDENTICAL! This quote from Dr. Henry Niman sums up then and now: "The link of the rapid spread outside of mainland China to a single case raises concerns that the two confirmed and multiple suspect cases linked to Saudi Arabia may represent a similar situation.  The SARS-CoV from the 2003 outbreak had been infecting patients in Guangdong Province in late 2002, but the Hong Kong physician precipitated the global expansion, raising concerns that the upcoming Hajj in Saudi Arabia may pose a significant world health risk." Now get this. Guess who is receiving the sequences for analysis of this latest SARS CoV corona virus? Dr. Ron Fouchier, from Erasmus in the Netherlands... the very same point man who ran the recent experiments confirming that less than five mutations remained along one naturally occurring sub-type of HP H5N1 before Outbreak of a "Bird Flu" Pandemic! What do you wanna bet Fouchier has a place waiting for him (and his) inside one of the underground bunker labs for when the rats flee the surface! AND NOW SUDDENLY, RIGHT BEFORE FLU SEASON, AT THE MOST OPPORTUNE TIME FOR VIRAL SPREAD... IN THE COLD MONTHS, SINCE VIRAL CRYSTALS DO NOT SPREAD WELL IN THE SUMMER HEAT... WE HAVE A REINTRODUCTION OF SARS CoV, THE SECOND DEADLIEST VIRUS

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).