Rick Ackerman

Gold gutted and disemboweled a minor hidden support at 1353.60 that I'd flagged in the chat room (see inset), shortening the odds of the two-day close below 1353.70 that I'd said would clinch a fall to 1219.20.  There are two structural supports at, respectively, 1338.80 and 1323.00 that seem very likely to at least break the fall, but I expect any rebound from either to be temporary. Even so, and to guard against the hazards of certitude, we'll use 1439.40 as a bullish benchmark, since an impulsive thrust that hits that number would put the good guys back in the driver's seat.

I've revised my bear-market target for September T-Bonds to reflect the fact that the crushing selloff begun yesterday has continued into this morning.  From the standpoint of spin-control, Bernanke would have us believe that it's a controlled avalanche.  Whether controlled or not, however, it will be yet another turn of the screw for a real estate market in which improvements have depended entirely on rates that have been heavily suppressed by the central bank. A White House shill said the other day that it would take significantly higher rates to kill the current housing boom. However, given the difficulty for new borrowers to qualify even at the preternaturally low rates that have obtained, the pundit should be drawn and quartered for saying something so wretchedly stupid and disingenuous.

The pattern shown looks too pretty to miss, even by a hair. Traders are encouraged to make hay, which for night owls could entail shorting; or for early risers, bottom-fishing the 15054 target with a tight stop-loss. You can interpolate by using either DIA or the Mini-Dow to initiate the trade. Their respective targets lie at  150.45 and 15053.  As we went to press (10:38 p.m. EDT), the latter had just kissed its target and appeared to be lifting, albeit slightly. ______ UPDATE (9:26 a.m. EDT): The support held for less than an hour before sellers drove Dow Index futures 140 points lower. They have yet to find traction and now look like a good bet to hit a trendline that currently comes in at around 14850 (see inset, a fresh chart).

We could not have improved on Bernanke’s speech yesterday, although investors appear to have found it more than a little unsettling. Don’t worry, they’ll soon be back in droves, snapping up stocks as always, without so much as a moment’s pause as to why. Meanwhile, everyone knew beforehand that even the vaguest hint about cutting back on the Fed’s monthly purchases of Treasury debt and mortgage securities would be enough to send global markets spasming.  Look at the damage that’s been done already.  In the case of so-called emerging markets, they have gotten crushed in recent weeks as hot money has fled for safer venues.  And China’s financial system has begun to totter on fears that domestic credit speculation will not easily abide even a slight U.S. shift from easing. Under the circumstances, Bernanke talked his book about as well as he might have, suggesting that the U.S. economic recovery is proceeding well enough that it may be possible to end QE sometime next year. Yeah, sure. The official line has been that unemployment could be at 7% or lower within a year and that the real estate market will continue to firm. As Goebbels famously said, if you tell a lie big enough and keep repeating it, people will eventually come to believe it. So it is with a U.S. economic “recovery” that has rested solely on inflated home prices and shares driven by untold $$ trillions of funny money. Gold’s Usual Reaction Wall Street’s conniptions in response to Bernanke’s latest variation on a theme was at least amusing, with traders slipping and sliding in their own excrement, so to speak. The chart above shows this. The initial feint was higher, but it proved to have been a bull trap when DaBoyz pulled the plug, sending the Indoos into

Sometimes a seemingly perfect camouflage set-up will fail to produce a profit. We’ve all seen instances where a trade initiated at x caught a ride to the p midpoint but went no further. The tendency is to think we’ve done something wrong, but you should consider a second possibility – i.e., that the trend is simply too weak to reach the ‘D’ target of its minor camo pattern. In such situations, the best response is to jump on the next signal taking you in the opposite direction. This logic is demonstrated nicely in the recording. We were able to foresee a nasty reversal in August Gold later that day because of the failure of a minor, very tradable, uptrend to perform.

It's been a while since we looked in on this stock, but its resurrection from the ashes has been most impressive -- spectacular, even. Notice that even after quintupling in price in a mere nine months the stock is not even breathing hard. As much is clear in the ability of May's big thrust to push past a daunting 'external' peak at 241.88 on the first try.  The subsequent correction is already sufficient to trigger a fresh 'buy' signal, which occurred Monday at x=228.21.  Camouflageurs should use June weekly calls if day trading, or raw stock if you're able to hold theoretical entry risk to no more than 15 cents per round lot. ________ UPDATE (June 21, 3:22 a.m. EDT): I just noticed that, on the 180-minute chart, Wednesday's high failed by an inch to surpass a key high at 235.96 recorded on May 28. This warrants caution, and even 'camo' traders should be careful to climb aboard only if the opportunity looks perfect. _______ UPDATE (July 1, 2:55 a.m. EDT): Hidden Pivots aside, traders should look to the trendline (see inset, a fresh chart) to provide a buying opportunity.  If you're wary of missing a turn from somewhere above it, the 30-minute chart has enough 'external' peaks to prevent the attentive trader from being left behind. _______ UPDATE (July 8, 3:08 a.m. EDT): The stock has taken flight again without having gotten near the trendline. Current target: 233.28, subject to midpoint resistance at 225.64.

Shortly before midnight EDT, the E-Mini S&Ps were taking the sort of phony, mincing steps lower that could set up a luscious buying opportunity for camouflageurs working the night shift. If you read this message in the wee hours, check out the chart to see if the hypothetical trade I've sketched out matched reality.

If you're a night owl looking for easy pickings, the one-minute chart looks guileless at the moment (11:22 p.m.). The staircase of external peaks along the downtrend shown should provide you with a secure foothold, the moreso if you use the green line at 1642.75 (aka 'D') as a place to start looking.  However, any chart above the level of the three-minute will probably yield an appealing-looking short. On balance, because the market seems unable to resist the siren call of Helicopter Ben, the best play from here is probably to fade sellers.  Keep in mind that we are still targeted on a minimum 1659.50 for this minor rally cycle.

With yesterday's moderate selloff, August Gold approached a ledge from which it could fall a further $135, to a longstanding target at 1219.40, before finding a good bottom.  'Camouflage' traders should position from the short side for now, but if you'd rather watch from the sidelines with fingers crossed, it should be with the hope that buyers push this vehicle above 1370.00 today.  That would turn the lowly one-minute chart impulsively bullish, which, although not much, would be a step in the right  direction. _______ UPDATE (4:05 p.m. EDT):  Nothing to encourage today; for in fact, the futures effortlessly crashed a minor HP support at 1353.60 that I'd flagged in the chat room. As noted here earlier, the 1219.40 bear-market target will become no worse than an even-odds bet if and when August Gold closes for two consecutive days beneath 1353.70.