Rick Ackerman

Buyers have demolished big-picture targets with ease, exhausting the supply of them. In order to come up with a new target to guide us in trading this vehicle over the near term, I've focused today on a smaller pattern that is effectively an extension of larger ones. It projects as high as 2633.75, but for the time being let's use the 2587.63 midpoint Hidden Pivot as a minimum upside objective. As always, an easy move through so clear an HP resistance would shorten the odds of the rally's continuing to the D target.  For now, please note that a 'lazy' pullback to the green line would generate a 'mechanical' buy signal. The word 'lazy' here has a rules-based connotation that you should understand before attempting the trade. If you are not familiar with the rule, please tune to the chat room for guidance in real time.

Friday's wicked thrust created an  island-gap reversal on the intraday charts. From our perspective, the very bullish significance of this comes from the fact that the rally impaled the midpoint pivot, all but guaranteeing more upside at least to the 166.80 target. This has in fact become so likely that I will eat my hat if AAPL fails to reach the target. Trading the move will be another matter, however, since every trader and investor on earth is bullish at this point. That means the stock is certain to turn diabolically evasive in order to prevent 'everyone' from making easy money on a sure thing. Mr Market could thwart us in several ways: 1) the stock gets to 166.80 much more quickly than expected -- i.e., like Monday or Tuesday; or, 2) it chops and hacks its way higher after nominally breaking out above the old all-time high, 164.94, recorded on 9/1. Regardless, we needn't be confused or fearful, since any price action can be reckoned, simply, in impulse-leg terms. For this purpose, use any one of the three 'external' peaks that I've labeled in the chart. _______ UPDATE (Oct 30, 1:51 p.m. EDT): The stock has hit a very clear, very compelling, very long-term target today at 168.46 (click here to see chart). The actual high so far is 168.07 -- a bullseye, for all intents and purposes. I'm as curious as you are to see what the stock does next. If you've held a long-term position, an adjustment is warranted at these levels in the form of a covered write, full or partial profit-taking ; or most aggressively, a short from the target.

Getting it wrong can be instructive, so view the clumsy tactical errors in this lesson with an open mind. Stocks were in their steepest selloff in months, and so we naturally made the mistake of thinking they would bounce from promising-looking Hidden Pivot supports as always. Instead, sellers barely seemed to have noticed the pivot, which evinced no discernible bounces. Did this price action doom the rally into day’s end that was to follow? As of Thursday morning the answer to this question was yes, probably, although not with any great certitude.

AMZN and GOOG have exploded skyward in after-hours trading Thursday, fueled by earnings that evidently exceeded the expectations of the usual clueless hacks who forecast them.  It's tempting to think this is the blowoff that so many of us have been anticipating for...years. More likely, however, is that both stocks are headed significantly higher.  Check out my latest tout for AMZN (below) to see where the stock could head next, presumably after a perfunctory correction.

Just when it was starting to look like the stock market couldn't go down, the Dow Industrials sold off 210 points to start the day. By the end of the session the broad averages had recouped nearly half of their earlier losses, but enough technical damage had already been done to suggest that weakness will prevail for at least another day or two. This is notwithstanding a short-squeeze rally into the close that appeared to stall at a Hidden Pivot resistance noted in the E-Mini S&P update below.

Sellers crushed the tight stop-loss I'd advised for a bottom-fishing trade Wednesday, ejecting us from the position with a theoretical loss of about $75 per contract. The futures went on to overshoot the 2554.75 target by a whopping 13 points, sufficient to imply that more downside awaits despite the short-covering rally into the close. It generated a 'counterintuitive' buy signal that I'd prefer to ignore, since the bounce has stalled this evening at p=2558.88.  Immediate potential is to D=2576.25 if buyers can get past that hidden resistance, but I'm not going to hazard a prediction about whether this is likely to occur. _______ UPDATE (Oct 26, 10:15 p.m.): Zzzzzzzzz.

The Dow Industrials rose effortlessly more than two hundred points in the first hour of Tuesday's session before ending the day with a shallow correction. This suggests buyers are not the least bit winded from last week's steep climb and that still higher prices are likely over the near term. I can offer one Hidden Pivot target with possible stopping power nonetheless: 23,665.10, which can also be used as a minimum upside projection for now. If it's reached, that would equate to a 224-point rally from Tuesday's close.  I am not furnishing a chart with this forecast because the target's provenance is proprietary to the Hidden Pivot Method. Subscribers interested in the technical details should check my chat room post at eight minutes after midnight on Wednesday.  I suggest using DIA options to trade this one -- bullish initially; then, if you are so inclined, short and tightly stopped at the target.

Tuesday's dipsy-doodle price action took a precise bounce off a midpoint Hidden Pivot support at 2562.50 that validated the corrective pattern shown along with its 2554.75 target. You can bottom-fish there Wednesday with a 2550.25 bid, stop 2548.75, provided point  'C' at 2570.25 has not been breached to the upside first. Were that to occur it would put in play a larger, bullish pattern with a midpoint resistance at 2557.50 and a D target at 2593.60 (30-minute, A=2545.25 on 10/19).

A recent Morning Line drew flak from one Rantly McTirade, a lurker who posts occasionally at Rick's Picks under that pseudonym.  'Rantly', while evidently impressed by the accuracy of my technical forecasts, took me to task for 'mouth-farting' and 'pontificating' about some of the big themes, most particularly a deflationary bust that I have long viewed as inevitable. I responded that if my 0.6% forecast for the long bond, for one, proves correct, he'll be eating a ladleful of crap somewhere down the road. I got argumentative support from 'Farmer,' whose interesting posts in the  Comments section of Rick's Picks have gained him a devoted following in that forum. Read his response to Rantly and you'll understand why: Your comment might be amusing McTirade if what was coming were not so damned alarming. You did however hit the key words “deflation and housing” and that’s where the most pain will be felt when asset prices begin to fall back to Earth once more. Sorry, but we are not at a permanently high plateau nor will prices just keep rising indefinitely. And yes, things are going to be just as bad as the deflation theorists have argued all along (if not a whole worse). This can be demonstrated with a number of charts but the one I will link is perhaps most appropriate for today. Home-Price Index Nightmare The Case-Shiller home price index going all the way back to 1890 is tracing out the worst possible pattern for homeowners that anyone might have imagined. After peaking in 2006 and crashing for several years it has bounced off its bottom seen in 2011 (just as gold peaked) and is making a run for what will undoubtedly be an ugly double top within the next two years. Time of arrival can be comfortably