Rick Ackerman

The futures have rolled down from an interesting place, a millimeter shy of the 3828.00 'secondary pivot' shown in the chart. This is not an illogical place for  a trend to fail, even a major one, and it is somewhat encouraging for subscribers who bought puts in QQQ, DIA and IWM over the last couple of weeks as advised.  The selloff has yet to develop legs, however, and would need to hit 3595.75, breaching a key 'external' low recorded on December 21, to become technically significant. Along the way, the weakness would trigger a 'mechanical' buy at p=3717.75, stop 3644.25. However, we'll look to create a less risky entry set-up if and when the opportunity arises. _______ UPDATE (Jan 20, 7:50 .m.): Bulls appear to have clinched the remaining 90 points to a 3938.25 target first mentioned here ten days ago. Any higher would indicate a minimum 3967.75, an even more important Hidden Pivot  resistance given here earlier. We'll want to attempt getting short up there, so stay tuned. ______ UPDATE (Jan 22, 8:35 a.m.): We could be witnessing the start of the Trump rally in reverse -- i.e., a bear market -- so let's put that 3938.25 target aside for the moment. A 217.59 target in IWM that is arguably more important has effectively been fulfilled via a so-far high at 215.98.

Silver's chart is more bullish than gold's, since the December rally exceeded an important external peak. This will allow us to attempt tightly stopped bottom-fishing at the 24.12 midpoint support shown in the chart, although we shouldn't count too heavily on it to turn the futures around. An rABC set-up on the hourly chart can be used to initiate the trade, so nudge me in the chat room if it triggers on Tuesday and you need guidance.  If the pivot is easily exceeded, that would imply additional downside over the near term to as low as D=22.25. _______ UPDATE (Jan 18, 11:46 a.m. EST): Silver's Whoopee Cushion bounce Sunday night off a 24.04 low could have been worth as much as $5000 per contract to anyone who used this somewhat unconventional rABC set-up. Shifting 'A' to the visually more obvious low at 24.73 would have produced a winner as well, yielding a slightly larger gain. If you're still aboard, caution is advised, since the rally, robust though it was, failed to generate an impulse leg on the intraday charts. That would require a print at 25.19, 17 cents above the so-far high. _______ UPDATE (Jan 19, 5:38 p.m.): The rally looks corrective, although a rally exceeding last Thursday's 25.99 peak would turn it impulsive. ______ UPDATE (Jan 20, 7:57 p.m.):  The plunge to the green line two weeks ago may have looked like a 'mechanical' buy, but I did not advise it because it came from a peak that fell just shy of p=28.30. Once decisively above this Hidden Pivot resistance, bulls would have a fighting chance of reaching 34.67.

'Mechanical' set-ups are particularly well suited to buy stocks when they swing violently. That's because our entry points are calculated to get us aboard just as the last of the psychotic bulls who trade such stocks have been shaken out. What better opportunity could we have than the shares of small biopharmaceutical companies? They are notoriously volatile, frequently doubling or tripling in the space of a day or two. Are 'mechanical' set-ups up to the challenge? The answer is 'yes', and this lesson will help you to understand why.

Much as I'd like to encourage you, the chart offers little reason for enthusiasm over the near term.  It was hard not to notice on the last rally that bulls were too enfeebled to reach the midpoint resistance at 1967.10 (see inset), let alone impale November 9's 'external' peak at 1973.30. Even more dispiriting, the subsequent downdraft generated a bearish impulse leg on the daily chart when it exceeded by a decisive $2.90  an 'external' low at 1820.00 recorded on December 14. Taken together, these signs suggest that we should not get our hopes too high looking out perhaps 6-9 days. The bigger picture remains bullish but unexciting.

With gold's gratuitous, 4% plunge on Friday, bullion has once again affirmed its reputation as one of the nastiest, most frustrating assets an investor can own. Its chief enemy is a global network of shamans, thimble-riggers and feather merchants who make their living borrowing bullion from the central banks for practically nothing, then lending it to everyone else for slightly more. They are always looking for excuses to pound quotes so that they can replace what they've borrowed at a lower price. Helpful to this goal is a story that, however ridiculous, spooks gold bugs into dumping their holdings. The current story is that the Democrats will somehow be bad for bullion, although no one can say exactly why. To believe such claptrap is to implicitly believe that when Kamala Harris takes over for the mentally failing Biden, she will impose rigorous constraints on spending that will strengthen the dollar. Yeah, sure. But that's not the point. The balance of power is about to change so radically in Washington that no one really knows what will happen next. For all we know, the Republic might not survive until mid-term elections in 2022.  If such a grave crisis is in fact bearish for gold and silver, then Harris, Schumer and Pelosi are bullish for America and the dollar; Greenspan, Bernanke and Powell were skinflints; John Wayne was a homo, and beer causes cancer. Biden's Replacement The bottom line is that we should tune out bullion's rigged swoons until the crooks and shysters are ready to let it run. Sometimes it takes courage and conviction to stay the course, and this is one of those times. The chart shows that gold's correction since August has been moderate and that when it ends, there is potential for further appreciation to at least $2290/oz.

The chart introduces a new target and a pattern that has worked beautifully since its inception in early November. On the way to the 3938.25 target, it delivered a textbook 'mechanical' buy at the green line just before Christmas and has the potential to do so again with a pullback to p=3717.75. Even if this doesn't happen we'll still have a target we can use for a precise and reliable handle on the trend.  I do not intend for the target to supersede one at 3967.75 that comes from a much larger pattern that has been featured here for a while. But the provenance of the new one is so compelling that it warrants being our focus for the time being.  The quick ABC followed asymmetrically by an elongated C-D segment yields some of the most reliable and useful targets I have observed, and that's why I am so jazzed about this one. _______ UPDATE (Jan 14): Zzzzzzzzzzzzzz. The futures have spent the last five days lollygagging within inches of the target pattern's secondary pivot at 3828.00. It's neither illogical nor inconceivable for a bull market to fail at this benchmark, but it would take a plunge exceeding the 3596.00 'external' low recorded on 12/21 to nail down such a bearish conclusion. ______ UPDATE (Jan 15, 11:50 a.m.): The hard stall at p2=3828, as well as my growing suspicion that the jig is up for the bull hoax begun on March 23, makes me less eager to buy p=3717.75 'mechanically'. Cancel the bid, although I'll still sanction bottom-fishing there if you know how to use an rABC set-up to cut the $5500 entry risk down to a theoretical $300 or so per contract.

The pattern shown is a '10' on the gnarly scale, but that won't diminishes its odds of working for us. That means you can use the 213.16 target as a minimum upside projection for the near term. It should also suffice as place to try shorting with a tight stop-loss, a trade that I recommend using put options if you've made money on the way up. Be alert to a possible stall that may be short-able at exactly 211.36. That's the 'D' target of a lesser pattern on the hourly chart that began with Dec 2's 180.76 low. As always, if bulls punch through the higher target with ease, that would imply another leg up after a pullback. ______ UPDATE (Jan 12, 5:14 p.m.): Careful!  IWM stalled three cents from the 'alternative' Hidden Pivot flagged above. The very shallow pullback since would seem to imply bulls are game for a possible finishing stroke to 213.16. If you shorted the high, stick with it for now and let me know in the chat room what position you hold. ______ UPDATE (Jan 14, 6:20 p.m.): Subscribers were advised to buy a few Feb 5 170 puts for around 0.22, in case next week's inauguration does not come off as smoothly as expected.  I'd say the chances of that are around 20%-25%, but our puts effectively give us much juicier odds.  IWM traded as high as 215.00, today, implying the mindless herd is intent on stampeding at least a little higher. However, I've advised put buyers to put the trade out of mind, since we are just taking a shot. _______ UPDATE (Jan 20, 8:01 p.m.): See my 17:50 post in the trading room today for timely guidance.

A 327.27 target that has been in play since mid-November can serve as a minimum upside projection. Don't look for bulls to sprint to the target, given their intricate dance at the 308.23 midpoint Hidden Pivot. However, they ultimately were able to build a base atop the resistance, and this will help conserve energy for the next big push. The pattern is not likely to yield a 'mechanical' buying opportunity, since that would require a hellish swoon down to the green line. But we can still look for a handhold using the same tactic on the lesser charts. It will be possible in any case to leverage the target with a call butterfly spread.  Specifically, I'll recommend  buying eight Feb 12 325/330/335 call butterflies, bidding 20 cents for them initially. If they don't come on the first day, we'll try to leg on the spread, bidding 0.55 initially for eight Feb 12 325/330 call spreads. If we are successful, we'll complete the butterfly by selling eight 330/335 vertical call spreads. My prices are guesstimates, but we can adjust them as needed in the week ahead. ______ UPDATE (Jan 14, 6:33 p.m. EST): Since price action has been flaccid lately, let's lower our sights a tad, using p2=317.75 as a minimum upside target for the near term.  Also lower the bid for Feb 12 325/330 calls spreads to 0.45, good through Friday. _______ UPDATE (Jan 16): Any fills to report? (Jan 19 update: Evidently not.) _______ UPDATE (Jan 20, 8:08 p.m.): The rally is all but certain to hit p2=317.75, but if it pops through, look for more upside to the 327.27 target given above. The latter would equate to a 1600-point rally in the Dow, while the lower number corresponds to D targets I've put out for the Russell 2000/IWM. 

Last week's high at 48.65 stalled a millimeter from the D target shown and left just one rally target at 51.80 remaining to be achieved. That is no guarantee that 51.80, which was given here earlier as 51.92, will be reached. Indeed, it's possible that Friday's peak will turn out to have been the climactic blowoff of bitcoin's historical rally. And yes, if you actually believe that, I've got a bridge to sell you. Even bitcoin skeptics must realize by now that any rally target we can come up with acts like  magnet, and that is why 51.80 is entirely likely to be achieved.  Although knowing the destination will be reached makes for an unexciting spectacle, we still don't know how ravenous buyers  will be when they get there. But if they fist-pump their way through 51.80, it would shorten the odds that 100 eventually will be hit. FYI, the equivalent target for $BRTI, which closed on Friday at 40798, lies at 52192. _______ UPDATE (Jan 16): A slight breach of p=38.45 has opened a path over the near term down to as low as d=32.40, a Hidden Pivot that you can bottom-fish with a stop-loss as tight as 31.99. Here's the chart. _______ UPDATE (Jan 20, 8:15 p.m.):  The steep three-day plunge reversed from within an inch of a 33.58 target derived from using the lowermost of three point 'A' highs on the daily chart, 46.80. The 32.40 target given above remains valid in theory, but a rally exceeding 39.04 would put it on ice. If the low holds, the next big rally could hit 53.37 (60-min, A= 28.57 on 12/29). _______ UPDATE (Jan 21, 9:43 a.m.): The low of the overnight relapse so far is 32.20, slightly below the 32.40 target I flagged a while back. 31.73 will