May 2013

'Experts' who predicted relief at the gas pump this summer blew it big-time. Instead of the $3.50-per gallon price we were given to expect, premium unleaded is pushing $5 in some places and has even hit $4.30 here in Colorado. Still, if the chart shown completes the head-and-shoulders pattern it's been building for more than two years, there may yet be a break in prices come September.

June Gold has been up a much as $7 in the early going Tuesday evening, but it will need to do better than that to trip my 'snooze alarm'.  For details, as well as a low-risk strategy for getting long, check out today's Gold tout and the chart that accompanies it.

Bulls should have learned by now to distrust any and all feints higher in Comex Gold, since each almost invariably gives way to an equal reaction in the opposite direction. That said, bulls still hold a small edge in the task of completing a move to the 1430.10 target shown.  If this were to occur, it would trip the snooze alarm I'd advised setting at 1416.60 At that price, we'd have a bullish impulse leg on the intraday charts -- not to mention, a possible opportunity for camouflageurs to get long if the thrust is subtle enough.

Night owls looking for a way to pass the time profitably might try bottom-fishing at the 1648.25 midpoint pivot shown. (Notice that I've used a distinctive one-off A here.) 'Camouflage' will generally be the best way to go, but in this case the patterns looks sufficiently promising to attempt it with a bid at the target and a two-tick stop-loss. Another thing to like about 'p' is that it is not near any prior structural lows that the hoi-polloi would tend to use for similar purposes.

Today's commentary proffered some potentially spectacular outcomes for Tesla-mania, but for those looking for the next day-trading opportunity in the stock, the 119.52 target shown should be used as a lodestone.  'Camouflage' cover could be difficult to find in a rally so far advanced, but if the stock is going to hit 119.52 today, your best bet might be to monitor Wednesday's opening on the one-minute chart for the first ABC pattern that meets our simple rules.  Click here if you're interested in learning those rules. ________ UPDATE (June 4): The hourly chart has swung to bearish, and although this has not invalidated the 119.52 rally target, it will shift our focus to the corrective pattern now developing (see inset, a fresh chart).  If the stock is bound significantly higher we should see this pattern reverse -- possibly tradeably -- from around its 'p' midpoint support (which is as yet undetermined). _______ UPDATE (June 6, 2:25 a.m. EDT): Yesterday's bull-trap rally off a gap-down opening aborted the downtrend, although the move would need to hit 104.27 to generate a bullish impulse leg on the hourly chart. The fact that the rebound came from 3 cents above the 88.42 midpoint support (see inset, a fresh chart) is an additional factor that is short-term bullish.

Index futures and gold are trading fractionally away from Friday's closing prices late Sunday night, but my hunch is that things won't remain so subdued this week. We'll continue to hold a short position -- and at this point, a riskless one -- in the Diamonds, notwithstanding an extravagant forecast that calls for a 1500-point Dow rally over the summer.

We're into day five of a tedious slog sideways, and it deserves only a small benefit of the doubt as a possible consolidation because of the failure of last Wednesday's spike high to get past the small external peak at 1416.50 (see inset).  That said, if the ABC rally pattern should get second wind, we could expect it to hit a minimum 1430.10 over the next 2-3 days.

The daily chart is starting to look heavy (see inset), but the selling so far has not come even remotely close to generating a bearish impulse leg.  The hourly chart is another matter, even if the flux of bullish and bearish legs recorded over the last several days looks to be no worse than a skirmish. The  duel would tip in bulls' favor on a rally exceeding Sunday night's so-far high of 1657.75 high by just just 1.50 points.  Night owls looking for an easy way to get long should take note of the 'external' peak at 1659.00 (5/22 at 7 p.m.) for this purpose. _______ UPDATE (11:42 a.m. EDT): The first impulsive push above 1659.00 did in fact generate a very tradable pattern: A=1654.50 (5/27 at 11:00 p.m.); x=1663.00.  Since D=1669.75 has been exceeded by a few points, we should infer that the current pullback will give way to yet another upthrust.

U.S. stocks barely flinched last week as shares trading elsewhere in the world got shellacked. The global selloff began with a 7% plunge in the Nikkei early Thursday.  Asian markets dove in sympathy, then Europe followed suit with a 2.1% drop in the FTSE 100. But when it came time for Wall Street to show a little fear, bears were nowhere to be found.  The Dow closed off just 12 points, demonstrating yet again the old adage that if you can keep a cool head while everyone around you is panicking, then perhaps you don’t understand the situation. Then again, why should U.S. investors even care about Europe and Asia? Home prices are soaring, not only stimulating the all-important “wealth effect,” but also creating new collateral that presumably will help catalyze the next consumer-credit binge. That’s assuming one occurs.  For it could happen only after Americans have dealt with a trillion dollar mountain of college loans, staggering increases in the cost of health care, stagnant incomes; punitive new taxes at the federal level; and in ultra-blue states like California, Minnesota, Massachusetts and New Jersey, tax increases implemented by lawmakers who evidently view the fraudulent economic recovery as a great opportunity to enlarge the scope of government. T-Bond Blowoff Coming Meanwhile, there seems to be a growing consensus among my fellow gurus that this market really is different.  Indeed, nothing seems to make U.S. stocks go down -- at least, not for longer than a day or so. Overnight selloffs reverse before the opening bell, and when there is weakness intraday, losses are recouped via short-squeeze buying in the final hour. If there is no good news to lift shares, then bad news is simply ignored. Europe’s deepening slide into intractable recession is no longer even talked about in U.S. newspapers,