Failed Rallies Warning of Trouble Just Ahead

Stocks were weak all day, but bears were too timid to deliver the haymaker. The Dow Industrials dropped 133 points, but if sellers had meant business the way they did in December, the blue chip average would have been down at least 500 points. Permabears shouldn’t give up hope, though, since it looks like the dam is about to burst. The evidence can be found in the failure of some key stocks controlled by institutional buyers to reach clear rally targets sent out to Rick’s Picks subscribers over the last couple of weeks.

Boeing: Uh-Oh!

The most telling example is Boeing, a lunatic-powered, sunny-story stock that has been in a nearly vertical climb since Christmas. A week ago it was on track to hit a Hidden Pivot target at 454, a prospect we we’d planned to leverage with some call calendar spreads. The trade never had a chance to ripen, however, because BA turned sharply lower from 446 last Friday. The target is still valid in theory, but as a practical matter out-of-the-money put options are looking more enticing. Rallies that fail well shy of our proprietary targets tend to accelerate to the downside. Indeed, that is what we should expect in the days ahead, so buckle your seat belts.

  • John Jay March 7, 2019, 10:56 am

    Reply to “None”:

    Our society is failing at every level.
    Morals, Politics, Economics, are all Mad Max now.
    Congress has begun the process of filling Federal prisons with Political Prisoners.

    High end Universities are now strictly for the Bolsheviks, and the more unintelligent, violent, and irrational they are, the more they are made into Heroes of the People.

    Annual drug ODs(70k) and suicides (45k) are now a leading cause of death.
    My take?
    The folks not up to being violent thugs at the street level or corporate level just give up and end their hopeless existence.

    To anyone who grew up in 1950s America, this collapse in the quality of life is disturbingly apparent and shows no signs of slowing, only acceleration.
    Resistance is a slim hope.
    Survival, Evasion, Escape is the best course of action now.
    The more working capital you have, the better your chances and comfort levels.

    Stay out of trouble.
    Make as much money as you can.
    Over and out.

  • John Jay March 7, 2019, 9:19 am

    Fun With Book Values!

    Boeing Book Value= 72 cents per share
    Face Book Book Value= $29.48 per share
    Amazon Book Value= $88.70 per share
    Apple Book Value= $24.93 per share
    Netflix Book Value= $12 per share
    Google Book Value=$255.38
    GE Book Value= $5.92
    Ford Book Value=$8.84

    From: https://www.macrotrends.net/

  • none March 7, 2019, 6:12 am

    Failed Rallies Warning of Trouble!

    The failure in a rally will be the interest rate market, on the verge of the biggest collapse in rates one can ever think of.

    Observing a 53-80% decline in rates is now an unforeseen event, but a real reality of what is in place.

    This will move the TXY (30 Year) down towards a new low of 1.62 and .75%. An unheard of price level and a unthinkable target. The brass ring is a 1% prime rate over the months ahead.

    It will be rates that bring down the prices of all markets, as falling rates are a kiss of death for markets, not the other way around as many suggest and work their trades toward.

    I am targeting ZB contract above 200-0.

    I am targeting TNX (10 year) at under 0%.

    In a equity bull market lower rates are bullish, a equity bear market places lower rates as bearish.

    Have a great day Rick.

    Think as to just what lower rates will do for markets when equity markets are falling.