Rick Ackerman

Following is a particularly interesting item from a Rick's Picks forum regular who goes by the name 'Seneca'.  His latest post, which concerns the effect of solar and lunar cycles on the markets, deserves a wider audience than it would ordinarily get in my forum. The material he quotes is from the work of Stephen J. Puetz, a cycles theorist who is highly respected and particularly well known to stock market traders and chartists. What Puetz had to say back in 1995 should perk up the ears of anyone wary about the risks the bull market will face as it enters the oft-fraught month of August: “Puetz attempted to discover if eclipses and market crashes were somehow connected. He emphasized that he is not contending that full moons close to solar eclipses cause market crashes. But he does conclude that a full moon in general and a lunar (eclipse) full moon close to solar eclipses, in particular, seem to be the triggering device that allows for the rapid transformation of investor psychology from manic greed to paranoia. He asks what the odds are that eight of the greatest market crashes in history would accidentally fall within a time period of six days before to three days after a full moon that occurred within six weeks of a solar eclipse? His answer is that for all eight crashes to accidentally fall within the required intervals would be .23 raised to the eighth power less than one chance in 127,000. “. . .[Puetz] used eight previous crashes in various markets from the Holland Tulip Mania in 1637 through the Tokyo crash in 1990. He noted that market crashes tend to be lumped near the full moons that are also lunar eclipses. In fact, he states, the greatest number of crashes start after

In today's list of touts, I've analyzed Boeing, which is singularly responsible for most of the Dow's gains in July. The bull market in the stock begun in Feb 2016 has gone vertical in recent weeks, suggesting a blowoff top may be near. For a precise rally target -- one that could be reached in mere days rather than weeks -- check out the tout below and the chart that accompanies it.

The feature pages  of Tuesday's Wall Street Journal offered the usual jumble of economic contradictions. We read on Page One that losses for credit-card issuers are increasing, reversing a six-year trend.  This, the Journal notes dryly, could be "a warning sign for markets and the broader economy."  Elsewhere in the newspaper, however, we read that business at Boeing has been gangbusters, including deals that will eventually total $290 billion with Indian airlines over the next 20 years. On the same page, another story purports to explain why oil prices recently settled, albeit briefly, above $50 a barrel. But wait: A glut of retail space in the grocery sector threatens to trigger a massive wave of store closures across the country. Which story best reflects the true state of the economy? Take your pick.

AMZN struggled to gain traction somewhat above the 975.80 correction target I'd identified. It remains viable in theory, but we'll set it aside for a day and give buyers the benefit of the doubt because of the bullish impulse leg they created Tuesday on the hourly chart. I'll further suggest using a 'counterintuitive' set-up to get long, but only if the stock retraces to a low that is closer to the point 'a' low I've identified in the chart (see inset).  This will require entering on a buy-stop limit, something we don't often attempt because of the way the stock can jump around from one tick to the next. If the tactic intimidates you, substitute a 'mechanical' trigger on the 3-minute chart, using a much smaller, bullish abc pattern._______UPDATE (Aug 2, 8:33 a.m. EDT): Cancel the trade, since AMZN drifted higher overnight after having gone no lower than 991.58. That's a relatively distant 4.56 above the would-be 'a'.________ UPDATE (Aug 2, 11:47 p.m.): Sellers are having such enormous difficulty pushing this gas-bag down to the 975.80 correction target we've been using that I'm almost ready to give up on it. Officially it would take a pop above Monday's 1032.85 high to warrant throwing in the towel, but in this case we'll stipulate that AMZN need only close above 1006.40 to put bears on the run.

If most stocks have been able to waft effortlessly higher when AMZN, by far the most important stock of them all, has been getting trashed, just imagine what they could do with AMZN in bullish gear. This could happen soon, since the retailing giant's shares are closing fast on a correction target at 975.80 where the stock could reverse direction with a vengeance.

I've switched to the December contract, displaying enough price bars to temper even the permabull's overripe enthusiasm for gold at the moment. Not that there's much cause for worry, either.  For in fact, the picture is so utterly hum-drum, with repeated, gratuitous swings of nearly $100, that it cannot but prepare you for more hypnotic, meaningless price action. We'll have mild reason to perk up if the current rally shreds its way past the 1290.00 'external' peak that I've labeled, but until then I can only suggest that you get back to your nap and enjoy a good snooze._______ UPDATE (Aug 2, 11:54 p.m. EDT): If the futures haven't rallied above 1270.30 overnight, look for more slippage to at least 1262.30 in the early going. A breach of that minor Hidden Pivot support would send them even lower -- to as low as 1254.20 over the near term if the selling turns strident.

The Indoos have recently sailed past a 21763 target derived from a nine-month uptrend on the daily chart, so I've hauled out the weekly chart for a look at a much bigger picture. It projects a possible bull-market top at 23317 while leaving room for yet higher targets. Even so, the ABC rally pattern shown offers enough clarity to suggest that when the Dow hits 23317, the Hidden Pivot is not going to give way easily.  As to the likelihood that this number will indeed be reached, I would say there's about an 85% chance. Mainly, it is a matter of how buyers smoked the midpoint Hidden Pivot resistance at 19343 the first time they encountered it. Moreover, the first pullback that followed failed to come down to the red line, demonstrating that Mr Market was, and still is, in no mood to defer to timid bulls who are hesitant to jump aboard. If he runs true to form, the pitch of the rally is likely to steepen in the weeks ahead, perhaps producing the blowoff top that so many of us have patiently awaited for so long._______ UPDATE (Aug 10, 7:34 p.m.):  Today's selloff did no technical damage whatsoever to the daily chart. In fact, the pullback occurred from a price where we might have expected it -- i.e., at the 22,022 midpoint Hidden Pivot shown (click here). Traders please note: A strong 'mechanical' buy signal would be generated if the retracement continues to the green line at 21,200.

With no help from the broad averages, AMZN, the locomotive of the global bull market, chugged higher on Tuesday, demolishing a Hidden Pivot resistance at 1018 with ease. This implies the stock will reach a minimum 1083 before it hits solid resistance. Because it will have taken AMZN at least 17 months to get there, we should expect a tradeable and perhaps very significant pullback. In the meantime. we should also expect the broad averages to move higher as AMZN drags them in its wake. If the stock reaches 1083 before the week ends it would be a blowoff worthy of the name. Your trading bias should remain bullish until such time as the target is reached or the stock generates a bearish impulse leg on the hourly chart._______ UPDATE (Jul 20, 12:01 a.m.): AMZN did in fact create a bearish impulse leg on the hourly chart, so the yellow flag is out.  This is the first negative sign we've seen on the '60' since the stock pushed into record-high territory earlier in the week.  If the selling continues, exceeding 1004.00 to the downside over the next 2-3 sessions, the recent all-time high at 1034.97  could take on new importance. _______UPDATE (Jul 24, 5:26 p.m.):  Fall below 1004? What on earth were we thinking!? The stock swam strongly against the tide Monday, peaking with a $17 rally when the Dow was down more than 80 points. The 1083 target remains viable, but because the intraday high occurred almost precisely at the 1041.97 Hidden Pivot resistance of a lesser pattern (60-min, A= 1004.00 on 7/18), caution is still warranted. However, if the stock blows higher, 1070.64 (60-min, A=884.49 on 4/13) can be used as a minimum upside objective. ________UPDATE (Jul 27, 1:03 p.m.): AMZN has plummeted $33 today after hitting a

Although AMZN got walloped on Friday after missing earnings estimates, Wall Street barely missed a beat. In fact, the Dow touched a new record high as usual and looked eager to go still higher when trading resumes on Monday. AMZN's dramatic peak occurred at 1083.31, matching exactly-to-the-penny a bull market target I'd initially drum-rolled in early June. The target stood to be an important one, since it had been 16 months in coming. And because AMZN itself is arguably one of the most important companies in the world, a top in the stock could well augur one in the broad stock averages. As of Friday, however, although AMZN dragged down the S&P 500 and the Nasdaq, it didn't curtail buying in DJIA stocks, as I've noted above. My gut feeling is that this 'divergence' will soon be reconciled in bullish fashion, with the Dow carrying the day.  Even so, I'd be surprised if AMZN gets instantly back in bullish gear, since Friday's plunge will have temporarily scared off more than a few buyers. But it's also going to attract bargain hunters, raising the prospect that Friday's lows will hold.  In addition to the foregoing, VXX, which tracks short-term volatility in the S&Ps, still has much lower to go if it's going to achieve the 10.24 target I've forecast for it. Were that to occur, it presumably would be driven by the same kind of ratcheting, wafting rally that has propelled U.S. shares higher for years.