Rick Ackerman

The Dow Industrials tripped a 'mechanical' buy signal with last week's dip to the green line (see inset). The bullish Hidden Pivot pattern is not perfect for proprietary reasons that I won't go into here, but suffice it to say, if this were the five-minute chart of some garden-variety stock, there would have been little reason to fear loading up the truck when the Indoos bottomed last Thursday. Yes, it's difficult to be so blandly objective about the chart shown, because it is not some rinky-dink stock we are looking at; rather, it is a momentous chart whose ups and downs could foreshadow the health of the global economy over the next five years. What's Wrong with This Picture? There are caveats, to be sure. Using the same fearless rules that govern the charts of stocks we don't much care about, key resistance lies at the red line, 25559. But once decisively above it, at around 26,000, the blue chip average would become an even-odds bet to test the all-time high. There are a half-dozen powerful reasons why this 'shouldn't' happen, including the nascent collapse of two key U.S. economic sectors: housing and autos. There's also a growing likelihood that China's economic downturn and a slowdown in Germany are about to spread to the rest of the world. A tariff deal with China would almost certainly reverse the bearish tide in stocks, at least for a while. But if there is no deal, it's hard to imagine Wall Street summoning the energy for a last hurrah, let alone a sustained move into the ionosphere.

Bears were on the ropes when last week ended, with stocks gaining buoyancy from Trump's optimistic remarks concerning China. Assuming no news comes out over the weekend to queer Wall Street's good mood, expect the futures to easily hit the 2754.00 target shown (see inset).  Just a slight overshoot would surpass an important 'external' peak at 2755.75 recorded October 13 on the way down. That would refresh the bullish impulsiveness of the hourly chart, setting the tone for the near term. ______ UPDATE (Nov 19, 2:45 p.m.): So every rally is distributive, it would appear. And however bullish/bearish things feel at the closing bell, do the opposite.

If the Gold Bugs Index were to slip beneath the 132.32 Hidden Pivot support shown in the chart, it would put a 97.18 target theoretically in play. This worst-case number is calculated by shifting the point 'A' high of the pattern up to 2016's peak at 286.05. Such a dire scenario is by no means assured, since the downtrend has so far been arrested at the p2 secondary pivot of the larger pattern -- a logical place for a correction to end. However, it would take an upthrust exceeding 162.44, a 13% move from here, to turn the daily chart unambiguously bullish. The number 162.44 is equal to a look-to-the-left peak recorded on August 9 before HUI went over the falls._______ UPDATE (Nov 18, 5:07 p.m. ET): Buyers caught fire last week, rescuing the Gold Bugs Index from a punitive selloff that had threatened to test September's abysmal lows near 130. Bulls will face a key test just above, however, at the 151.16 midpoint resistance shown in this chart. If they can penetrate it decisively, or close above it for two consecutive days, that would put the 165.06 target well in play._______ UPDATE (Nov 26, 5:41 p.m.): The rally has laid an egg after pushing slightly past the 151.16 midpoint pivot flagged above. A two-day sell-off has not doomed the effort, but bulls will face a crucial test if HUI pulls back to 144.20, since that is where a so-so 'mechanical' buy signal would be triggered. Here's the chart._______ UPDATE (Nov 27, 8:27 p.m.): The so-so 'buy' signal has triggered, but we'll ignore it because bulls have fared poorly in this vehicle when seizing such opportunities. Come what may, our gain for the time being will lie in the learning process.

Get AAPL right and your big-picture forecast for the stock market will never go far wrong. Apple is the World's Most Valuable Company, after all, and therefore a must-own for every portfolio manager who wants to keep his or her job. That's why it's the only stock we need follow in order to know exactly what's on institutional investors' tiny, fevered minds. So how have our AAPL predictions fared? On Wednesday the stock plummeted yet again, bottoming just six cents from the 185.87 target hung out here two nights earlier when the stock was $12 higher. It turns out that I made a slight error when I drew the target pattern, and that the correct coordinates would have nailed the actual 185.93 low to-the-penny. Okay, so you're probably wondering what's coming next. A fair question. First of all, there is still room for a major bounce from slightly lower -- from 185.12, to be exact. This Hidden Pivot support differs from the one at 185.93 because it is based on highs and lows that occurred during the night session. If the support fails, it would increase the odds that the bull market begun in 2009 is over. What would constitute a failure? Considering the delicate precision of the pattern used to calculate the target, an overshoot of more than $1.00 (or so), or a two-day close beneath 185.12, would probably prove fatal.  That's why we'll be watching closely to see whether the so-far feeble rally from the initial target gets legs. If it exceeds 197.18 without going significantly lower first, bulls could breathe a mild sigh of relief._______ UPDATE (Nov 19, 9:31 a.m. ET): AAPL is getting whacked ahead of the opening bell because of a reported slowdown in iPhone sales. As the stock continues to fall, keep in mind

In my forecasts over the last year, I've treated bitcoin with skepticism and disdain, to put it mildly. (Check out the $BRTI tout at the bottom of the Rick's Picks home page to see how I've scorned not just cryptocurrencies, but those who have loudly hyped them for personal gain.) My strong doubts will have spared subscribers who have been habitually bullish on block-chain currencies a world of pain. However, recent developments are threatening to turn me bullish despite my deep distrust of 'money' that any Tom, Dick or Harry could start ginning up tomorrow. Be that as it may, bitcoin has taken a steep dive this week after falling off a ledge thousands of dollars above the very bearish target we've held in mind since January. If it hits that target, which lies at 4396 (basis the CME's real-time bitcoin index, symbol $BRTI), even I would be a buyer. And although I don't expect a trampoline bounce from my number, I am confident it will offer a relatively safe and precise spot for bulls to start accumulating a stake. If you held off buying until now because my forecast scared some sense into you, consider taking a free trial subscription to see what other cool stuff we're doing behind the subscriber wall.

This lesson is pretty boring and nearly fruitless, although someone mentioned in the chat room that during our hour together I had nailed a low in AAPL within two pennies using some fancy Hidden Pivotry. The technique is here to be examined, and – who knows – you might come across a similar pattern at some point and make money on it because you remembered the one in this lesson. In any event, consider it optional.

I argue below for monitoring AAPL's price swings obsessively, since the stock will give us an infallible 'read' on the stock market as a whole. On Wednesday, for instance, when AAPL began its bounce precisely from a 185.87 downside target I'd billboarded two nights earlier, the broad averages whipped around 180 degrees and took off like a shot. It was exactly 2:07 p.m. ET, and the Dow was banging out its intraday low at 24935, down 350 points.  The subsequent 328-point upthrust hit 25263, at which point the Dow was within 25 points of unchanged. The blue chip average relapsed in the final hour, presumably because its guiding light, AAPL, was unable to sustain altitude. I've provided benchmarks for AAPL for Thursday that will allow you to see for yourself how the stock's targeted highs and lows can be used to precisely time price swings in the broad averages. For the foreseeable future, AAPL will be leading them by the nose.

Lurkers missed a field day Tuesday in the Rick's Picks chat room. Crowdsourcing among Hidden Pivot experts found profitable ways to make money on both sides of the market in such diverse vehicles as crude oil, Beazer Homes and Canopy Growth, an NYSE biggie in the reefer madness category.  Crude fell particularly hard, and although some subscribers profited by going with the trend, others used the lows of precisely targeted corrections to ski up an avalanche.  Beazer, a homebuilder in a depressed sector, announced strong earnings and a share buyback, causing the stock to leap from $8.41 to $11.26 in the early going. The intraday high matched the 11.26 forecast I put out in the chat room to-the-penny, allowing one subscriber who also happens to be a bearish homebuilder to short 3000 shares at what proved to be the high of the day. The initial pullback to $10.61 worked out to a 4.2 bazillion percent gain when annualized. Want to get in on the fun? Click here and you'll have instant access to the chat room and a free two-week trial subscription to all features and services.

Updates for all of the trading vehicles tracked below are bearish, implying that Monday's hard selloff did not exhaust the downtrend. Even so, our two key bellwethers, AMZN and AAPL, are both close to interim supports that look likely to evince tradeable rebounds. I am becoming less enthused by the day about bottom-fishing such supports, however, because two such attempts in AAPL over the last week seriously underestimated the intensity of the selling.  Old habits die hard, and we've become used to buying weakness in the FAANG/lunatic stocks even as we've disdained the buy-the-dips mentality that has prevailed on Wall Street for almost a decade. Because of the growing likelihood that stocks have entered a bear market, any bottom-fishing we do henceforth will necessarily be more cautious than before. We'll get more leverage, for sure, since short-covering rallies are going to be more vicious than ever; however, the risks of being wrong have increased commensurately.