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The Morning Line

MLK Day Forces Bulls to Cool Their Jets

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It must have been frustrating for buyers to have to cool their jets for an extra 24 hours this weekend. The Martin Luther King Holiday denied them a full day’s opportunity to push the Dow higher by the usual 100 or more points. As a result, we could see see pent-up demand come charging back into the stock market over the next couple of days. But be prepared to see bulls feign a lack of interest in the first hour or two, since this would help shake loose some shares from widows, pensioners and other weak hands before DaBoyz goose the broad averages into their accustomed parabola.

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$ESH18 – March E-Mini S&P (Last:2782.50)

EST

Buyers did something on Tuesday that we don’t see very often these days, pausing for a few hours in their manic scramble to own every share they can get their hands on. Bears, with the wind at their backs for a rare change, failed for the umpteenth time to seize the advantage. When the dust settled, the futures had closed off a whopping nine points after being down as much as 20 points intraday. Oh well. Since a second day of accelerating weakness seems most unlikely, we’ll stick with the 2824.00 rally target given here earlier — or 2848.25 if any higher. Buyers can use a ‘mechanical’ set-up to generate a bid near the red line (p=2725.25), but I’d suggest using ‘camouflage’ on the one- or three-minute chart to do the actual trade, since the entry risk otherwise would be $2016 theoretical per contract.  Stay close to the chat room if you seek guidance for this in real time.  If the stock market startles by going lower we can sit back and enjoy the show, since many subscribers still hold soon-to-expire VXX calls purchased a couple of weeks ago for an average o.67. If the broad averages sell off as hard as they did for a while on Tuesday, those calls could triple in value in an hour.

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$GCG18 – February Gold (Last:1341.30)

EST

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$GLD – SPDR Gold Trust (Last:126.96)

EST

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CLG18 – Feb Crude (Last:63.56)

EST

Crude Oil has broken out with a sharp rally that easily surmounted a daunting-looking Hidden Pivot target at 63.08 (see inset) on the weekly chart. We’d been using a 63.59 target for the December contract to stay comfortably on the right side of the uptrend.  Shifting to the February futures, we see that this week’s so-far high at 64.77 surpassed the target by a whopping $1.69. If the rally continues, moving above a zone of resistance between 62 and 69 created early in 2015, it would augur more upside to $75 or even higher in 2018. This could not possibly be due to the mere curtailment of supply by OPEC et al.  What it implies is an upsurge in the global economy that has yet to live up to the by-now constant hubris of the financial press.

This is a free forecast (Tout) by Rick. Get a free trial of Rick’s Picks to see full member content.

$AAPL – Apple Computer (Last:174.29)

EST

Apple shares have held their own (see inset) against a spate of negative press, including most recently mounting concerns that iPhones, addictive as crack cocaine, are harming our children. Would Apple become less profitable if its social consciousness extended to the well-being of kids who are spending half their lives texting, browsing and streaming?  The inescapable fact is that such a change would dampen profits for the entire business world, since so much of it is tied to digital devices, social media and the virtual world of the Internet.  Television stoked similar fears about addiction in the 1960s (and thereafter), but those fears never seemed to impinge on the medium or its profitability. The Internet did, however — ironically because it has proven far more addictive than the TV medium itself, commanding an even greater share of viewers’ time than TV ever did, even in its heyday.

As for the stock, from a technical standpoint AAPL still looks to be consolidating for a shot at a 184.10 target we’ve held in mind for months. The fact that the stock has maintained altitude and will undoubtedly continue to do so until the negative press blows out to sea suggests that its institutional sponsors are blithely unconcerned about the effects of social pressures on Apple, Inc. A downturn in iPhone sales is all they care about — and even then, it has always been assumed that such weakness would at worst prove temporary.  It is only recession that DaBoyz should fear, since it would take a heavy toll on sales of Apple’s ridiculously overpriced hardware, most particularly iPhone models snapped up by Apple-cult buyers for $1000 or more.

This is a free forecast (Tout) by Rick. Get a free trial of Rick’s Picks to see full member content.

TNX.X – Ten-Year Note Rate (Last:2.55%)

EST

Uh-oh. I’d said bond bulls would be in trouble if this vehicle were to pop above 2.57%, and so it has. It tracks interest rates on the Ten-Year Treasury Note, and signs are not good. On Wednesday TNX breached the key threshold mentioned above, putting a possible further move to 3.11% in play. The breach of 2.57%, a ‘midpoint Hidden Pivot’ resistance, shown as a red line in the chart, would need to be more decisive for me to rate a move to 3.11% as an odds-on bet, but I’d call it a near-certainty if the rally were to go just a tad higher, surpassing the key ‘external’ peak on the weekly chart at 2.615% without taking a breather. We’ll probably know soon what’s coming, but it’s hard to imagine how a U.S. economy so completely dependent on vast excesses of credit will function if this key rate is in fact headed to 3.11% or even higher.

This is a free forecast (Tout) by Rick. Get a free trial of Rick’s Picks to see full member content.

$DJIA – Dow Industrial Average (Last:25,385)

EST

Buyers demolished yet another middling Hidden Pivot resistance Tuesday, much as they’ve been doing for the last nine years. I’d have laid odds that the 25,392 target (see inset) would show some stopping power, but it didn’t. When the dust settled, the Indoos had topped 47 points above it at 25439. When a Hidden Pivot as clear and compelling as this one is so easily brushed aside, it strongly implies that bulls have sufficient buying power to push the blue chip average much higher. I’ll back off targeting for a while until I can offer you a fresh one with the ability to shorten our odds for a successful trade north._______UPDATE (Jan 9, 11:41 p.m.): Back to the old drawing board. The 27,251 target shown should tide us over for a while, since it leaves nearly 1900 of upside for the Indoos to cover before they hit something ostensibly solid.

This is a free forecast (Tout) by Rick. Get a free trial of Rick’s Picks to see full member content.

$+VXX – S&P VIX Short-Term (Last:27.08)

EST

I haven’t given up on the lottery ticket we still hold — four 19 Jan 28 calls acquired for 0.67 last week when VXX touched a longstanding bear-market target at 26.32. On Monday, after noodling around near that Hidden Pivot support for three days, VXX slipped below the water line, trading as low as 25.76 intraday before closing at 25.98. The overshoot may not look like much on the chart, but it amounts to a so-far 2.1% fall beneath my benchmark. It is astounding to me that such a clear and compelling Hidden Pivot has evinced no bounce whatsoever. In any event the options are keepers, bought as a high-leverage speculation that VXX would trampoline from somewhere very near 26.32. If it does not we will have exhausted all possible targets of interest, and it’s unlikely we will try bottom-fishing again in the foreseeable future.

There are some bigger downtrending patterns than the one I’ve used to project 26.32, but all of them yield D targets below zero.  In the past, this has sometimes implied, as it did in case of Bear Stearns and Lehman shares in 2007, that the companies were bound for bankruptcy. However, in this case it likely means VXX will continue to fall toward zero until it is reverse-split yet again by the DaBoyz so that more retail suckers can be enticed to buy put and call options from them.  They’ve been making enviable money with this shell-game for years, but it is predictable that most of it will be wiped away in just a few days when VXX finally explodes, as it surely must. But with the magic power of our 26.32 support very nearly spent, there is no point in our dreaming about catching that bottom and being on the profitable side when VXX’s day of reckoning finally comes. _______ UPDATE (Jan 10, 5:49 p.m.): The volatility gods abhor nothing so much as a failed sell-off attempt that gives way to a weak rally. That’s exactly what happened on Wednesday, and it caused VXX to collapse intraday, reversing downward by a whopping 1.10 points so far. I will stick with the suggestion that VXX be treated, traded and disrespected as though it were headed to zero.  That is what it was designed to do and will continue to do until such time as the Masters of the Universe reverse-split it. Once VXX has been newly re-fattened like foie gras, DaBoyz will be able to sell option juice against it just like in the good old days.  Whatever the case, we have no exposure now and are unlikely to have any, any time soon. _______ UPDATE (Jan 16, 2:03 p.m.): For whatever mysterious reason, VXX has popped today, so far by 1.29 points. Consider this a bulletin to remind you that we still have a horse in the race in the form of still-out-of-the-money-but-not-by-much call options with three days left on them. If they should rise from the dead, do with them as you please.

This is a free forecast (Tout) by Rick. Get a free trial of Rick’s Picks to see full member content.

$BA – Boeing Co. (Last:318.43)

EST

We’ve been using a 301.96 rally target for the last month, but the stock has started to fall without having quite reached this Hidden Pivot resistance.  BA peaked at 299.33 on Wednesday and has since fallen as low as 294.13. My gut feeling is that the top should have occurred closer to our number, but that it will do so before the stock turns down meaningfully. Even so, we should be alert to the possibility that a significant correction has already begun. Any more slippage could do some serious damage to the hourly chart. In fact, a mere drop to 289.69 would exceed no fewer than four ‘external’ lows, posing the first real threat to bulls in months. This matters because Boeing is among the very favorite stocks of institutional buyers, who have made its ascent even steeper than that of the FAANG stocks and some others that are bought continuously and reflexively by portfolio managers. I”ll put out trading guidance for the stock when appropriate, so stay close to the chat room or check ‘Email Notifications’ on your account dashboard if you want to stay closely apprised. _______ UPDATE (Dec 27, 5:42 p.m.): The pullback so far has been shallow, going no lower than 293.01. I will provide trading guidance if and when the stock pops to within inches of the 301.96 target, so be sure to check ‘Email Notifications’ on your account page if you want to stay apprised in real time. _______ UPDATE (Jan 3, 9:12 p.m.): We spent some time poring over Boeing’s charts during this morning’s tutorial session, but to cut to the chase, I still expect D=301.96 to offer stiff resistance — enough, perhaps, to create an important top. This flouts the diligent effort DaBoyz have made to patiently consolidate the stock over the last three weeks in order to set the stage for a strong rally. Even so, the 301.96 target remains sufficiently clear and compelling that we shouldn’t expect it to be a pushover. _______ UPDATE (Jan 5, 12:36 p.m.): Astounding! There is absolutely no question about the authenticity, clarity and precision of the 301.96 pivot. The fact that it has provided no resistance whatsoever this morning suggests BA is headed much higher. Recall that p=266.45 precisely repelled two head butts in Oct/Nov, confirming the target. Today’s price action indicates that a stock already in a vertical parabola is likely to rise even more steeply in the days/weeks ahead. _______ UPDATE (Jan 9, 11:15 p.m .):  The pattern shown isn’t pretty, but it’s the best we’ve got for targeting an apparent blow-off in Boeing shares. Price action near the 300.37 midpoint pivot mildly confirms this, but we shouldn’t count too heavily on D=346.24 to show precise, if any, stopping power. A pullback to the green line — most unlikely in my estimation — would generate a very enticing ‘mechanical’ entry there.

This is a free forecast (Tout) by Rick. Get a free trial of Rick’s Picks to see full member content.

$+JYH18 – March Yen (Last:0.89055)

EST

Today’s chart shows a yen ‘short’ that triggered last week on the run-up to the green line (0.89989). The implication is that the December 2017 contract is about to fall to at least 0.86383.  A decisive breach of that number, a ‘Hidden Pivot’ support, would put a 0.79170 downside target in play over the long term. The corresponding numbers for the March 2018 contract are: 0.87520 (minimum downside, following a short at 0.90650); and a maximum 0.81260 if 0.87520 is decisively breached.  Alternatively, if the yen bear market begun in August 2016 is about to end, we should see a strong bounce precisely from 0.87520 (basis March); or from 0.86383 (basis December continuous weekly). _______ UPDATE (Jan 8, 10:57 p.m.): Shifting to the March contract, the tracking position is showing a paper profit of about $1160 (see inset). Do nothing further for now, but maintain the stop-loss at 0.93600.

This is a free forecast (Tout) by Rick. Get a free trial of Rick’s Picks to see full member content.


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Tuesday, January 23, 2018

The consistent accuracy of Rick Ackerman’s forecasts is well known in the trading world, where his Hidden Pivot Method has achieved cult status. Rick’s proprietary trading/forecasting system is easy to learn, probably because he majored in English, not rocket science. Just one simple but powerful trick -- managing the risk of an ongoing trade with stop-losses based on ‘impulse legs’ – can be grasped in three minutes and put to profitable use immediately. Quite a few of his students will tell you that using ‘impulsive stops’ has paid for the course many times over.

Another secret Rick will share with you, “camouflage trading,” takes more time to master, but once you get the hang of it trading will never be the same. The technique entails identifying ultra-low-risk trade set-ups on, say, the one-minute bar chart, and then initiating trades in places where competition tends to be thin.

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