September 2012

Bullion futures are getting shaken down Sunday night, creating a possible buying opportunity. Check out my touts for December Gold and Silver if you're interested, since both include charts on which I've sketched hypothetical patterns that could be bought using camouflage -- or in the case of Silver, a straight bid with a tight stop-loss.

I'm initiating coverage of this stock because its monster price swings could create some interesting opportunities for us with puts and calls. At the moment, the stock's recovery is targeted on the 651.17 midpoint resistance of the pattern shown. Accordingly, I'll recommend naked-shorting two October 650 calls if and when the stock gets within 20 cents of the target. You should stop yourself out if the calls trade 50 cents above where you sold them. (They should be selling for around $19, but that's just a guesstimate.)  This trade is intended only for subscribers with options accounts qualified to hold naked puts and calls. Generally, our option trades will involve long-premium strategies. ______ UPDATE (9:50 p.m. EDT):  Cancel the short for now, since the stock is falling. Instead, try bottom-fishing at the 623.28 target of the corrective pattern shown, buying two October 650 calls if the stock gets within 10 cents of the target. A 622.04 stop-loss should be used, risking perhaps $10-$15 per contract. ______ UPDATE (1:52 p.m. EDT):  I'm new to this stock -- had never even looked at it before, actually -- but I'll get the hang of it.  Meanwhile, it's hard not to be impressed by the maniacal fervor of the lunatics/thieves who apparently are running the show. A class act for sure -- all of it low.

The futures have pulled back to within a nickel of the small-pattern, 33.580 midpoint shown in the chart, but if they should retest the v-bottom low it would be an excellent opportunity for camouflageurs to jump aboard.  Upside potential over the near term would be to the 36.250 target of the larger pattern shown.  If the futures continue higher with no pullback,  the big-pattern 'p' entry point, a pullback from above which camo traders might attempt a belated entry, lies at 34.380.

Gold was getting mildly pounded Sunday night -- manifestly for no good reason, since, as we all know, every central bank in the world is now synchronously complicit in an open-ended monetary blowout. Tonight's so-far $15 shakedown is not yet bearishly impulsive on the hourly chart, but we should let nature take its course before we go bargain hunting.  For a hypothetical suggestion as to how we might do so using Hidden Pivots, check out the accompanying chart.  You can learn to “camouflage trade” yourself.  Click here for a free trial to Rick’s Picks.

We hold eight Dec-Oct 620 put spreads with a profit-adjusted cost basis of 9.90.  Our immediate goal is to add some Nov-Oct 730 call calendar spreads for $8 or less.  The best way to do so will be to leg into the position, buying the November calls on a swoon.  If you're interested, stay tuned for a timely intraday update, since that will be the best way to leverage the stock's sometimes violent swings.  You can receive these updates by checking the 'E-Mail Notifications' box your My Account page.  _______ UPDATE (8:00 a.m. EDT):  AAPL has gotten manipulated lower in pre-dawn trading, raising the possibility of putting on the spread for $8 or less without having to leg it on. My advice is to go for it, but under no circumstances should you exceed the $8 limit. I'd suggest buying the Novembers at a Hidden Pivot low but for the fact that any I could identify would likely be overshadowed by the presumptive support of Thursday's 693.62 bottom. _______ UPDATE (2:24 p.m. EDT):  Close out the put spreads now for 11.10 or better, realizing a theoretical gain of about $960 on the position.  This will give us a fresh start as we continue to bid $8 or less for eight Nov 730 -Oct 730 call spreads. ______UPDATE (10:01 p.m. EDT): The call spread is too far away right now to work, but if you haven't exited the put spread yet, keep trying.  A sale at 10.80 would have been easy yesterday, but not at 11.10 or better as I've stipulated. Today you can go as low as 10.90 -- and please report fills in the chat room so that I can establish a cost basis. ______ UPDATE (4:25 p.m. EDT):  Apple's plunge today sent the Dec-Oct 620 put spread as

A mere $40 thrust is all it would take for December Gold to vault two daunting peaks on the weekly chart (see inset), generating an impulse leg with sufficient power to leave bulls confidently in command of the long-term trend for the first time in a year.  The technical evidence suggests they are up to the task, since minor rallies on the lesser charts have consistently breached prior highs with little hesitation.  This dynamic would continue with a print today at  1778.20, setting up a potentially explosive move in the weeks ahead.

The news vacuum noted in today's E-Mini S&P tout has caused the stock market to go flaccid despite the fact that these are arguably the most Interesting Times since the summer of 1914.  If campaign bilge continues to dominate the alleged 'news', expect Wall Street's week to end with a whimper.

All day long yesterday, Google featured campaign stories at the top of their news page. Can the editors finding nothing more interesting to talk about? Evidently not.  Assuming the nation's news editors remain in navel-gazing mode as the week draws to a close, we should maintain a bullish bias on stocks nonetheless as they continue to mark time.  This vehicle is working on a pattern that projects to 1497.00, but that's assuming yesterday's 1443.50 low holds as a point 'C'. More likely, especially in a continuing news vacuum, is a feint below 1443.50 to set up a short squeeze either Sunday night or Monday morning. That said, if boredom encroaches, night-owl camouflageurs will find ample speculative entry opportunities on the 5-minute chart.  You can learn to “camouflage trade” yourself.  Click here for a free trial to Rick’s Picks.

[The weekly column I freelanced to the Sunday San Francisco Examiner in the late 1990s was as relentlessly bearish as my Rick’s Picks commentaries are today.  However, the essay below, published in 1997, was a notable exception.  Its thesis was that U.S. companies both large and small were perfectly positioned to benefit from the emergence of a global middle class.  Alas, America’s manufacturing sector instead moved offshore even as our multinational banks bulked up massively on steroids. We now know that the world had no need whatsoever for a 'financial superpower'; rather, what it does need, and thrives on, are the tangible goods and real wealth created by such emerging economic superpowers as China, Brazil and India. We can only hope that when the U.S. banks’ inevitable steroid breakdown has run its course, the U.S. will return to making money the old fashioned way. RA] U.S. stocks have been in a scorching, vertical climb for months, confounding the bears and effortlessly vaulting the immediate expectations of the most ardent bulls. What factors might they have overlooked in gauging the market? Could there be forces at work more powerful than the steady earnings growth and low inflation usually cited as key reasons for the longevity of this bull cycle, now well into its seventh year?  I believe so. A more plausible explanation may lie in the relatively recent and rapid emergence of a vast, global middle class, particularly in Asia, Eastern Europe and Latin America. To the extent this trend creates a burgeoning new marketplace for a wide variety of goods and services, U.S. companies stand to benefit the most, since they are indisputably the best in the world at meeting its demands. The point was driven home to me recently by news reports that the Malaysian government, with public and