Rick Ackerman

We've been using an ambitious, 2851.75 rally target to keep our minds off reality, but more immediately there is 2789.25, a Hidden Pivot that I expect to produce a tradeable pullback. My recommendation is to get short there only if you've profited from the uptrend. Elsewhere on the home page, I've reproduced a graph that shows how the Dow is nearing levels where, from a visual standpoint, a rally to new record highs will begin to look inevitable. As much could be said of the E-Mini S&Ps, which lie just shy of a series of three peaks made just before December's steep plunge. It's more than a little tempting to think an ascent to new all-time highs would set up a devastating bull trap. This is something to ponder as the stock market does the seemingly impossible, climbing a mile-high wall of worry. ______ UPDATE (Feb 19, 6:02 p.m.): Feeble buying pushed the futures to 2787.50, less than two points from the target flagged above. It remains valid, but any progress above it would likely encounter resistance at 2795.91. That Hidden Pivot should be the end of the uptrend, at least for a short while._______ UPDATE Feb 21, 8:39 a.m. ET): Upthrusts have continued to exceed minor Hidden Pivot targets, suggesting the futures want to go higher. The rally has been untradeable if keeping risk:reward at 1:3, since each new marginal high has given way to a pullback greatly exceeding the incremental gain from peak-to-peak. Here's a way around it, a mechanical set-up that would allow entry via a limit bid and a single stop-loss. Be aware, however, that the initial risk on a four-contract position would be $2800, for a potential gain of as much as $8200 if D=2811.25 is reached. As always, you could cut this down significantly

The trek to our longstanding rally target at 1345.50 has been so labored and tedious as to be nearly  untradeable. Rest assured the futures will get there -- although we should expect a stall at 1336.40, a Hidden Pivot resistance related to a somewhat higher alternative 'A' at 1251.60 recorded on December 19.  The rally has consisted of two extremely choppy legs as different in character as Laurel and Hardy. No matter. We knew all along where things were headed, even if the journey provided no good handholds for a mechanical entry. Please note that a decisive push past the target would put in play a more significant one at 1378.70. It will take a bit more than that, however, to create the impulse leg that would refresh the bullish energy of the weekly chart. Specifically, buyers would need to hit 1404.50 to surpass the key 'external' peak made at the start of 2018. _______ UPDATE (Feb 19, 3:16 p.m.): Gold had one of its sharpest rallies in recent memory today -- a $23 surge that has peaked so far at 1345.00, just 50 cents from our longstanding rally target. In the chat room, a subscriber reported exiting a profitable GLD call option position at the top. The futures have stalled, but the pullback thus far has been shallow. The target, a Hidden Pivot, is sufficiently clear that a close above it would be quite bullish, shortening the odds of a continuation to the 1378.70 target noted above. (Note: Numerous subscribers weighed in later with reports of target-related profits in such equity-based vehicles as GLD, Barrick, JNUG, NUGT and GDXJ.) _______ UPDATE (Feb 20, 10:20 p.m.): Buyers failed to reach an easy target at 1354.30 with today's thrust, warranting moderate caution. The bigger-picture target 1378.70 remains valid. _______ UPDATE (Feb

So much for the wall of worry! Bulls have improbably shrugged off steep downturns in the housing and auto sectors, rising interest rates, a costly tariff war with China, the pernicious rise of socialism on Capitol Hill, the economic implosion of China and Germany, a likely peak in corporate profits, a strong dollar that has sapped the earnings of U.S. multinationals; and, most recently, evidence that retail sales nosedived during the Christmas shopping season. All of these things together do not diminish the unstoppable look of the Industrial Average (see inset) as it moves within striking distance of new record highs. The Dow sits just inches from a 25,998 target we've used to stay with-the-flow, even as the trend has seemingly flouted sanity itself. At the target, the Indoos will have exceeded an important 'external' peak at 25,980, but will also lie within easy distance of an even more important peak at 26,277 from three weeks earlier. Speaking as a hard-core permabear who has learned to tune out gut feelings so that the charts can speak for themselves, your editor will mention a 28,110 Hidden Pivot that would become a logical minimum objective once the Dow has conquered the obstacles noted above. That would put it nearly 9% above current levels and 30% above the 21,712 nadir recorded in the final days of 2018. ______ UPDATE (Feb 20, 10:25 p.m.): The rally topped at 25,986, just 12 points shy of the target flagged above. Above it, the next important benchmark would be 26,084, equal to a small but technically significant peak made on November 9. Let's see whether buyers have the moxie to take it on. _______ UPDATE (Feb 28, 9:45 p.m.): The Indoos are primed to fall a further 154 points to the 25761 target shown in this chart. 

AAPL, not long ago the one true love of fund managers, has been a conspicuous laggard since the broad averages trampolined off December's lows. It is only in retrospect that we can see how they might have contrived, albeit with only modest success, to ignore the stock's big problem, which is that the company's ridiculously overpriced phones are poorly positioned to compete against increasingly aggressive Asian manufacturers. Factor in a U.S. economic slowdown that has lengthened iPhone's replacement cycle, and you begin to see why AAPL is unlikely to lead the stock market to new record highs. It could still be a good go-along bet, though, in which case I'd suggest using 187.74 as a minimum upside target for the near term. That would represent a 50% retracement of the slide from a record $233 in October to a bear market low of $142 early in 2019. A rally to 187 presumably would give way to another leg down, since the Q4 plunge created an impulse leg on the weekly chart that demands an eventual follow-through leg. If and when the other shoe drops, we'll have a 'midpoint Hidden Pivot' along the C-D leg to tell us exactly what's on traders' minds. For now, though, despite the stock's heaviness, a bullish bias is warranted.______ UPDATE (Feb 20, 10:39 p.m.): AAPL stalled precisely at the 173.24 Hidden Pivot midpoint of the pattern shown, validating not only the pattern but its 178.06 target. It will become a very good bet to be reached if and when the stock blows past 'p'. This matters a great deal, since it could not but energize the broad averages in their quest to turn what is still a garden variety bear rally into a push toward new all-time highs. Considering the recent shakeup at the company

Today's chart shows a rally target at 263.39 that looks like a strong bet to be achieved, probably within 3-4 days. It is somewhat higher than the corresponding target at 25,998 that I've flagged for the Industrial Average. Although you should monitor the latter for a possible stall, this Hidden Pivot looks more likely to nail the top -- or at least "a" top, since we should be open to the possibility that the stock market will flout a darkening economic picture and continue to rise for no good reason.______ UPDATE (Feb 26, 11:42 p.m.): This is taking too long, but yes, the rally target given above is still valid. _______ UPDATE (Feb 28, 9:54 p.m. EST): It is mildly bearish that DIA has turned down after peaking a point shy of the 263.39 target given above. This vehicle will fall most immediately to 257.69 if sellers crack the 259.06 midpoint support. (Click here for chart.) The target will work for tightly stopped bottom-fishing, but we shouldn't go full-bore because the hidden pivot coincides with a structural low at 257.50 recorded a week ago. If the pivot is hit in the first two hours of the session, use expiring 258 calls to play for an immediate bounce. Notice that a breach of the 257.50 low could set up a 'counterintuitive' buy as well, but its usefulness would depend on when in the session this occurs.

Although the stock appeared to be setting up a juicy 'counterintuitive' short a couple of weeks ago, it has yet to trigger. Instead, FB has worked its way lower in fits and starts, diminishing the 'surprise factor' that makes CI trades so appealing. I doubt that sellers are spent, given the stock's punk performance on Friday when many stocks soared. However, I am no longer recommending the short trade, even as FB falls deeper into the gap created on January 31, when it was goosed mightily on strong earnings news. Since my long-term outlook for Facebook remains bearish, we will continue to look for opportunities to profit from its decline. We might even do some bottom-fishing if the trade sets up well. In any case, stay tuned._______ UPDATE (Feb 21, 6:14 p.m.): Today's sinkage triggered the 'counterintuitive' short at 160.31, putting p=148.15 in play as a minimum downside objective. We'll remain spectators for now, since the stock is very oversold and could pop at any time.______ UPDATE (Feb 25, 6:16 p.m.): Perhaps inspired by the successful distribution of AAPL shares, DaBoyz are working Facebook hard, moving it against a tide of negative news that eventually will send the stock below $100. They goosed it today strongly enough to leave shorts on the hook at the close. Let's see how much higher the smart guys can waft this brick. _______ UPDATE (Feb 28, 10:08 p.m.): The smart guys have been unable to elevate the stock, which now looks bound for at least 158.28 (60-min, A=165.69 on 2/26). _______ UPDATE (Mar 4, 9:43 p.m.): Give them their due, the smart guys got Facebook to swim against the tide today, tripping a theoretical 'buy' signal in the process. This means we should use p=174.11 as a minimum upside objective for now._______ UPDATE (Mar

Although it's fun to bad-mouth the rally, the yo-yos who have stoked it could win in the end. From the moment stocks took off on December 26, we've been 'certain' it was just a bear rally designed to fool everyone into thinking new highs were actually possible. It would need to be powerful enough not only to convince the rubes that this was so, but to switch off the warning circuits in the brains of hardcore permabears such as your editor.  We remain skeptical that new highs are coming, even as we put our rational thoughts aside to consider solely the evidence on the charts. No matter what happens, let's not forget that Mr. Market's primary mission is to fool as many investors as possible, and to wreak havoc on the best-laid plans of bulls and bears alike.

We're at the end of an era, says my colleague Bob Hoye of Institutional Advisors. Political craziness in the U.S. has peaked with a wacky socialist scheme to soak the rich for money to pay scientists and bureaucrats to control the weather. No less idiotic is the entrenched notion that the Fed can prevent the financial bubble it created from bursting. This delusion will end when the inevitable bear market arrives. As for the Green New Deal, says Hoye, it will collapse when enough voters come to understand that "climate scares have been rigged for grant money and to impose a new world order." For most Americans, the end of these two manias cannot come soon enough. Click here for Hoye's superb essay, which sees parallels in the collapse of Rome and in popular uprisings going back to ancient Egypt.

Stocks had trouble staying aloft Tuesday after rocketing higher a day earlier. Although the Dow finished with a 117-point gain, it had been up by more than 200 in the early going and probably would have finished in the red if sellers had been less timid. There were other signs of heavy distribution. For one, AAPL's sly handlers opened the stock on the high of the day, trapping bulls before pulling the plug.  Facebook couldn't even muster a decent head-fake at the bell, opening on a 46-cent rally that fooled almost no one. TSLA, the most heavily manipulated stock of them all, died on the come out roll, finishing the day at 307.16 with a $4.63 loss.  And NFLX, the biggest percentage loser, fell 7.93 to 352.04. Under the circumstances, DaBoyz are likely to have trouble goading shorts into covering as the week draws to a close. Look therefore for weakness over the next two days as they manipulate stocks lower in order to exhaust sellers in preparation for the next fake rally.