Rick Ackerman

Like every other trader who listened to the news over the weekend, I was very bearish when I came to my desk Monday morning, and that is exactly why the short-squeeze was so powerful. To determine where it was headed, I looked at charts in various time frames and came up with an implausibly bullish target at 2783.50 that is shown in the inset. I warned subscribers to get out of the way and did so myself, since the chart implied the upthrust still had another 187 points to go. By day's end that had been reduced to 115 points, and I have little doubt 2783.50 will be reached.  If it is decisively exceeded, please note that the rally could go all the way to 2881.00. That Hidden Pivot resistance is derived from the higher corrective coordinates that I've labeled B2/C2. We'll trade with a bullish bias for now, but also look for shorting opportunities at the various HP levels.  One more note: The secondary pivot (p2) of the bigger pattern lies at 2652.00, which has been penetrated only slightly so far and was giving buyers a little pushback Monday evening. _______ UPDATE (Apr 7, 9:29 p.m. EDT): The reversal from an early-morning high 33 points shy of the 2783 target warrants caution. Bulls got ahead of themselves, but it remains to be seen how badly Mr. Market will punish them for their brash enthusiasm as the day began. A pullback to the green line (2497) would trip a so-so 'mechanical' buy, but I'm not recommending taking action at the moment. _______ UPDATE (Apr 8, 9:25 p.m.): Up, up and away!  I am holding to the 2783.50 target flagged above, or if the futures penetrate it decisively, to another at 2881.00.  The lower number should be short-able, but I am

The bounce from the March 23 low has recovered a third of the initial, 1196-point drop, but it failed at last week's peak to trigger a theoretical buy signal at 2572 by 10 points.  That wouldn't turn me bullish if it happens, since I expect the broad averages to fall to 1500 or lower on the next leg down. However, it would bring a neutral-to-slightly bullish bias to my swing- and day-trades. The futures in the meantime could fluctuate over a 600-point range (!) without saying much. That is the distance between the 2174 bottom and the midway point between the green-line trigger line and the midpoint Hidden Pivot resistance at 2971. This level is instinctual with me and unrelated to any rules we use to trade or forecast. More immediately, a midpoint support at 2374.13 that I flagged last week is still my minimum downside target for the near term. Here's a chart that shows it.

The stock market wafted last week into a psychologically surreal zone somewhere between terror and, if not greed, then at least jittery optimism. How can stocks rally at all when no one can predict whether the deadly spread of coronavirus is about to overwhelm America as it did Italy? The economic picture remains just as murky, since odds the global economy will fall into a full-blown depression are probably no better than 50-50 right now. Granted, two trillion dollars worth of consumer stimulus is bound to produce short-term benefits and a fleeting bounce on Wall Street. Were you aware that much of that money is in the form of loans that will allow employers to avoid laying off even a single worker? The loans are structured as gifts, and if you borrow a few million dollars now and don't furlough any employees, there's reportedly a good chance the debt will be forgiven. This effectively creates a months-long paid vacation for the idle at the expense of those who are working. Or perhaps not; for if those still on the job are not taxed at some point to pay for this epic giveaway, the money will have come, so to speak, from trees. To use another metaphor, it would be the torrent of helicopter money that Ben Bernanke famously asserted could prevent the U.S. economy from getting crushed by deflation. An Ethereal $88 Trillion Could halting the reversal of American's long run of prosperity be as simple as printing tons of money? I somehow doubt it. But I am still not quite ready to cede the endgame to the inflationists. For even if a series of bailouts injects as much as $2o trillion into the system, that would still be far less than the sum remaining to be deflated from the

DIA spent most of last week avoiding what I still regard as a very likely fall to at least 200.92. This midpoint Hidden Pivot support is nicely located to set up a enticing 'mechanical' buy, although I've already warned that call options may prove too pricey to yield the kind of edge we need to do the trade. Still, with DIA priced above $200 per share, we'll need to find a way so that subscribers with relatively small trading accounts can participate. In practice, this will probably mean buying the nearest strike with soon-to-expire options offered for under $1.00, and bidding the options only  when DIA has gotten with a dime of the target.

The 1679.20 rally target we used last week is still very much in play, but it will take a decisive thrust past it to imply buyers have the moxie to reach D=1782.30. A two-day close above the lower number would significantly shorten the odds of a move to at least p2=1730.70, but an intraday spike to around 1700 would be equally encouraging. That could conceivably set up a 'mechanical' buying opportunity on a pullback to x=1637 (the green line), so keep that in mind if the futures fall hard enough to make your stomach churn after rallying over the next day or two. _______ UPDATE (April 6, 8:38 p.m. EDT): Buyers have pushed the futures decisively past the 1730 secondary pivot this evening, implying they'll have little trouble reaching the 1782.30 target flagged above. Once past it, the June contract should be presumed bound for the 1857.90 Hidden Pivot shown in this chart.  This target is equivalent to one at 1852.00 that I projected for the April contract two weeks ago, when gold was $150 lower. _______ UPDATE (Apr 7, 9:40 p.m.) Buyers actually did have trouble when Monday night's running start reversed and turned into a rout. The 1782.30 target remains viable nonetheless, but we'll need to monitor June Gold's ups and downs closely to find a safe spot for re-entry.

AAPL looks like it will need to go lower for a running start to help Buffett and DaBoyz trigger off the next short-squeeze. If so, the 228.11 midpoint support shown in the chart will be an opportunity to try bottom-fishing. The pattern is too gnarly to attract the attention of the rabble, and the red-line support is nicely in the middle of nowhere. Accordingly, we'll look to buy Apr 9 calls for under 1.00 if the stock gets within 0.15 of the target. This may require going as high as the 250 or 252.5 strike.  Keep in mind that the calls will expire Thursday because markets will be closed on Good Friday. ______UPDATE (Apr 6, 9:37 p.m. EDT): Well, we knew all along that Buffett and DaBoyz weren't going to get hosed just because they own hundreds of billions of dollars' worth Apple and iPhone sales are headed for disaster. The way they fist-pumped the stock today through the 259.68 midpoint Hidden Pivot shown in this chart, there can be absolutely no doubt it is going to at least 282.45. I am still predicting a plunge to well below $100 before this bear market is over, but Apple shares are going to 282.45 first. _______ UPDATE (Apr 14, 8:04 a.m.): The stock has traded as high as 279.70 overnight, coming within 1% of the well-advertised target. When it reaches 282.45, AAPL will have rallied by exactly a third from the March 23 low of 212.61 and will lie just 13.8% from its all-time high, on Jan 28, of 327.90.  An opportune place, by my runes, for the Masters of the Universe to take the money and run. Please note that I've used a one-off 'A' to project the target, but if it's exceeded by more than 0.15-0.20, that would announce more

My colleague Bob Hoye saw a yield curve inversion that occurred in July as reason to prepare his subscribers for the stock market crash that has ensued. Every inversion since 1857 foretold a recession, suggesting that even without the pandemic, shares were headed for trouble. Still more concerning, he notes, is that the curve inverted twice this time, a rare and especially ominous event seen only in 1873, 1929 and 2007. These were all memorable years in the annals of economic ruin. Will we be fortunate enough to escape with something less this time? The next few weeks may hold the answer, but prayer couldn't hurt.

Because DIA opened on a gap below the green line (see inset), it is very likely to continue falling to at least 200.92, the midpoint Hidden Pivot support shown in the chart. Ordinarily I would suggest bottom-fishing there using call options, and would encourage Rick's Picks newbies to join in the fun, especially if, like most who have tried their hand at options, you've never cashed a winning ticket. Options premiums are so ridiculously juicy, however, and bid/asked spreads so wide, that we may have to sit this one out.  Stay tuned to the chat room in any case, since opportunity may come unexpectedly. ______ UPDATE (Apr 2, 11:15 p.m. EDT): The subdued short-squeeze in the final hour did not change my outlook, although you should not do the trade if 200.92 is hit in the final hour. It would take a rally exceeding 225.87 to negate the bearish target.

Traders looked beyond the two-week national ordeal that officials have diligently tried to prepare us for and evidently saw more ordeal further down the road.  The Dow dropped a thousand points on Wednesday, but there was no fear, just a mood swing back toward darkness. It will surely pass, at least briefly, but don't take that as a guarantee of a rally by week's end. I've projected much lower prices for stocks and expect the Dow to trade under 10,000 in search of a bear-market bottom perhaps two or three years from now.. We are all hearing so many scary personal stories these days that it's difficult to judge whether it is anecdotes that are collectively weighing down shares on a given day or more-arcane concerns, such as the central bank's extraordinary efforts to keep real estate paper from imploding. It is unavoidable that the tangible side of this problem -- the impending plunge in commercial and residential property values -- will make the Fed's death-defying paper-shuffling act seem like a relative walk in the park. Jim Grant, the most learned observer of interest rates around,  puts this grave problem in perspective in an interview posted at Dudley's Reports. Noted Grant, "If you can conjure, without adverse effects, trillions of dollars of new credit and everything is better because of that, net better, you know? Wow, I suppose we wish that had been discovered in the Iron Age. We would be a lot richer by now."