Friday's coy feint above p2=299.25 cracks the door slightly for a shot at 312.99, our longstanding target while the Cubes were cooling their jets for the last three months. They've been waiting for the perfect vaccine and, more recently, a clear indication of who will next occupy the White House. The geniuses who are paid to throw Other People's Money mostly at a half-dozen stocks would have us believe they can live with Biden, but we shouldn't believe this for a minute. The story has given them cover to distribute stocks, however, until investors come to their senses as they inevitably do, sometimes with such epiphanies spaced decades apart. We can assume for positioning purposes that the next 'oh-god-what-have-we-done?' moment is most likely to occur with QQQ cavorting near 312.99. It will provide a speculative opportunity to get short in any event, so stay tuned. _____ UPDATE (Dec 9, 8:30 p.m.): The plunge from within inches of the 312.29 target is mildly bearish. If the selloff continues without pause, exceeding November 30's 294.78 low, that would turn the short-term picture outright bearish. _______ UPDATE (Dec 10, 6:15 p.m.): Sellers turned docile. Let's see how they set up for the weekend.
It can sometimes seem like there's no bottom when the Bad Guys are whalin' on gold, but bulls can at least hope for an upturn from the 1756.30 Hidden Pivot target shown in the chart. Failing that, expect to see the December contract work its way down to 1700.00, since the dirtbags who manipulate bullion prices for a living are nothing if not slaves to the obvious. Ordinarily I would suggest bottom-fishing with a tight stop, but in this case the impulse leg is ersatz and therefore unreliable, since it exceeded no external lows. The pattern could prove good enough for government work nonetheless, so don't hesitate to use and 'rABC' set-up to get long if you know how. _______ UPDATE (Nov 30, 9:27 p.m.): The so-far feeble bounce from a 1762.30 low has not quite negated my 1756.30 downside target, but the burden of proof now on bulls would lighten if the futures can clear a minor resistance at 1816.30 created last Wednesday on the way down. ________ UPDATE (Dec 1, 9:08 p.m.): The bounce is no longer feeble, but it is still a smidgen shy of 1817.10 [corrected] print needed to generate a trustworthy impulse leg on the hourly chart. A further thrust, especially if it is unpaused, surpassing Nov 24's 1829.80 'external' would strongly suggest that gold's bullish reversal has gotten off the launching pad. _______ UPDATE (Dec 2, 7:24 p.m.): In after-hours trading, the February contract poked very slightly above an external peak at 1835.50 that's equivalent to the one at 1829.50 noted above for the December. This has generated a bullish impulse leg, along with a minor, uptrending pattern that could provide some hooks for getting long. Stay tuned to the chat room for further guidance. _______ UPDATE (Dec 3, 6:18 p.m.): A struggle at
The bearish pattern in December Silver's chart, unlike gold's, is 'textbook' and unambiguous, leaving little doubt that a decisive breach of p=22.26 would send the futures down p2=20.40 in search of a durable bottom. Any lower would put the pattern's 18.55 'D' target in play, but we'll take this mini-bear market one step at a time. Friday's precise bounce from p implies that the two remaining Hidden Pivot levels can be used to bottom-fish, presumably using an rABC pattern of small degree. Moreover, a rally from p or p2 cold set up an equally opportune 'mechanical' short. ______ UPDATE (Nov 30, 9:31 p.m.): Today's chintzy poke to just below p=22.26 was not decisive, but the subsequent bounce will need to continue to at least 25.16 to take some pressure off bulls. _______ UPDATE (Dec 1, 9:27 p.m.): Shifting to the March contract, we can use the 24.78 'D' of this reverse pattern as a minimum upside target for the near term. An easy move through it would be bullish, and levels x and p can be used enroute to fashion 'mechanical' bids or to paper-trade them just to stay closely attuned to the trend.
Even with Covid-19 fear-mongering ratcheted to-the-max, the stock market continues to defy gravity and common sense. A Dr. Andre Campbell warned over the weekend that “we could be facing an apocalypse by Christmas” due to the growing number of hospitalizations. Does he mean apocalypse in the Biblical sense, implying the final destruction of the world? We await clarification, although there are reasons to be skeptical about his claim. For one, he is a trauma surgeon, not a virus expert. And for two, he is speaking for Zuckerberg San Francisco General Hospital, known as ‘San Francisco General’ when, decades ago, I lived in the Portrero Hill neighborhood where it is located. The facility was notorious back then for stuffing its corridors with Medicaid patients on gurneys. All praise to the Zuck if he has improved the level of care, but he would be doing the world a kindness by confining his chief means of thought control to Facebook. Concerning the stock market in these all-too-interesting times, it has shown scant concern not only about the economically crippling course of the pandemic, but also about an unsettled election that could produce the most anti-business administration in U.S. history. Some Trump advisers reportedly have told him to give up the fight. But considering the President’s not exactly groundless charge that Biden won by fraud, as well as his reputation for never backing down, there is close to zero chance he will concede before the courts have heard him out. (If you think the effort is doomed, as the news media would have us believe, read this when you've finished my commentary.) Jot Down This S&P Target So what can we expect from the stock market as investors' hopes rise toward a generational peak? I wrote here earlier that you should prepare to sell
The stock market is under heavy distribution, and for good reason: Even if the vaccines we've been reading about lately are as effective as claimed, they will be too late to prevent tens of thousands of U.S. business from going under. Supposedly, vaccines from Pfizer and Moderna are nearly 100% safe and 95% effective. This is wildly speculative, since no one knows how long immunity will last; whether those who get vaccinated will still be at risk for transmitting the virus to others; and whether mRNA vaccines will cause serious autoimmune reactions. These are hardly niggling concerns, although they didn't stop investors from bidding shares into the ozone when Pfizer announced encouraging trial results two weeks ago. Stocks were already priced for perfection, discounting not only the prospect of a Covid-free world, but the possibility of the U.S. economy returning to the 3%-plus growth it enjoyed under Trump's stewardship. These are just pipe dreams, and crazy ones at that. Biden is not Trump; he is a political wimp, and the Democratic Party to whom he owes his apparent victory is extremely anti-business. They have said as much, and that's reason enough for investors to brace for a 'Trump rally' in reverse starting sometime before Biden takes office. The coming bear market will draw irresistible power from the vaccine's inevitable failure to effect an instant cure, and from the economy's inability to return to anything even remotely resembling its ebullient old self in the foreseeable future. Folly's Apogee Under the circumstances, there has probably never been a better time to 'sell the news', since shares have been ascending heavenward since March on hopeful 'rumors' of a global cure. The effect has been supercharged by unprecedented credit stimulus flooding into shares, real estate and the consumer economy. When the downturn hits, the
I had expected the receding prospect of economic recovery to weigh on the markets last week, but it seemed not to have fazed buyers at all. They stood their ground even though the impact of new vaccine stories seems to have fallen off considerably since the big Pfizer announcement two weeks ago. Now, it would seem, there are a half-a-dozen players, and it's hard to tell which could deliver a cure that might put America back on track. In the meantime, bears should forget about reaping a bonanza right away merely because deeper recession looms. You can use the 3798.50 target shown in the chart as a minimum upside projection for the holiday season, and p=3498.75 as a place to park a 'mechanical' bid. The required stop-loss at 3398.75 implies entry risk of $5000 per contract, so we'll want to convert the set-up using an rABC on the lesser charts to cut it down to size. For now, our short-term trading bias should remain bullish.
Bitcoin Mania 2.0 waxed so exuberant last week that I've hauled out a big-picture chart to show you what rabid buyers will be up against when business resumes in earnest Sunday night. My strong hunch is that they will make short work of the 21.63 midpoint Hidden Pivot resistance, putting a 39.50 target theoretically in play. The pattern is well up to snuff for creating bullish mechanical trade set-ups, although the implied $900 entry risk for some of them may call for tactical measures using our rABC workhorse. Stay tuned, because it's going to be a bumpy ride. _______ UPDATE (Nov 24, 5:55 p.m. ET): The rally is now powerful impulsive on the weekly chart, unlikely to pull back to the green line to trip a 'mechanical' buy. That means we'll need to improvise a more daring entry-on-the-fly, competing against a world that has gone crazy-bullish on bitcoin. Stay tuned to the chat room for intraday guidance, even if you are already aboard.
DIA has been stalled for two weeks at February's record highs, likely marking time until the mood is right for the next big thrust. Considering the unsettled state of, well...everything, investors' complacency has been extraordinary -- and I don't mean in a good way. Funny money talks, and for better or worse, we are living at a time when there is just no shutting it up. As before, a pullback to p=282.74 would trigger a mechanical buy, stop 275.64, and the D target at 304.07 is still short-able with a tight stop-loss if you've made money on the way up. _______ UPDATE (Dec 8, 5:51 p.m. EST): The target still looks good as a place to attempt a very tightly stopped short, but there has been no opportunity to ride with the trend, since it has been characterized by a series marginally higher highs separated by swoons three to four times as large. _______ UPDATE (Dec 9, 8:43 p.m.): DIA popped to 303.60, 1.10 points from the target. Since no one mentioned this in the chat room, I'll assume for the time being that there is little or no interest in trading this vehicle. Comments? Fills? FYI, this vehicle is still a short as long as it continues to hover within inches of the target. ______ UPDATE (Dec 10, 6:20 p.m.): There were a couple reports from subscribers who took action at Wednesday's top, but tactics varied too much for me to establish a tracking position. Even if I did, Friday looks like it could be a coin toss.
Gold's consolidation since July has been an ordeal for investors, but the good news is that bears will be ready to keel over dead when the time comes. They've struggled hard to push bullion lower, and even though their efforts have been helped occasionally by air pockets such as the 100-pointer we endured one day a couple of weeks ago, they know that we know these fright-mask tactics will not win in the end. For the time being, however, let's stay focused on the 1809.60 target that has kept us from getting sucked in by head-fakes and distributive rallies. This Hidden Pivot is not of the highest quality because the impulse leg is illegitimate, but the futures can still be bottom-fished with a tightly constructed 'rABC' pattern on the lesser charts. Alternatively, it would take a print at 1983.90 to sound 'taps' for bears. _______ UPDATE (Nov 24, 6:03 p.m. ET): The way this brick has been plummeting, one might think traders are dumping gold to raise cash for bitcoin. The futures have crashed the 1809.60 target with ease, implying that whatever rally is coming, unless it exceeds 1898.00, will be a short sale.
Silver's downtrend since late July has probably given bears even less satisfaction than gold's. It is a corrective dirge that last week resisted falling to a midpoint Hidden Pivot support at 23.10 where we could plan on bottom-fishing. Odds are high of an upturn beginning from somewhere between the red line and the 22.62 low recorded on 10/29. The trade is best initiated with an rABC pattern, possible using a=23.67 from 11/19 on the daily chart. If the trade is stopped out and the futures close beneath the red line, that would imply more jeopardy down to as low as D=20.08. _______UPDATE (Nov 24, 8:59 p.m.): Silver has bounced nicely from just below 23.10. If you did the trade exactly as directed, using a 'reverse rABC' set-up with a=23.67, you could have cashed out at the red line for an $1100 profit shortly before 9:00 p.m. Only one subscriber reported getting long near the 23.10 pivot as suggested, so I have not established a tracking position. If you simply bought there with a tight stop-loss, you'd be up around $1300 now, presumably able to manage the trade without much stress. Here's the chart.
