Rick Ackerman

When AAPL slightly exceeded a 135.96 Hidden Pivot target on the weekly chart Wednesday, I took it as mildly bullish. Although I missed nailing the top by just 1.5 %, I've gotten so used to hitting the big swings within a dime that I brashly assumed bulls were still in charge and simply taking a breather. That could still prove to be the case, although it may be a few weeks before we can judge. In any event, Thursday's 12.7% plunge has altered my perspective, since it increases the odds that a major top is in. You can see in the graph that the record high achieved earlier this week maxed out bullish possibilities on the weekly chart. There are no alternative patterns to the one that projected to 135.96, and the only way to create a new one would be for AAPL to effect a healthy B-C corrective leg from the recent, record high. It would need to be followed by a rally of exactly $12.21 to revive the bullish case. This could take four to six weeks to unfold, and it would be surprising if it were to happen in significantly less time. For related reasons that I made clear here earlier, it is very unlikely to happen all if the dollar is carving out a major bottom right now, as seems possible.

There are still unfulfilled rally targets well above the recent highs, but we'll focus for the time being on the downtrend, since it has begun with such brio. Notice how the lows of Thursday's selloff failed to penetrate the midpoint Hidden Pivot support at 3426.50. This is not bullish per se, but it suggests that sellers lack the moxie to finish the job. How can they demonstrate otherwise? For starters, they'll need to push the futures below p to the D target at 3360.00. It'll take a close on Friday below that number, and another on Monday; or a decisive breach of it intraday, to suggest bears have taken charge.

Our trade set-ups are coming increasingly in areas of charts that I have labeled ‘discomfort zones’. This usually means working off price spikes into the middle of nowhere, so to speak. They are places where most other chartists and even the algos lose their bearings, since there are no visual points of reference to guide them. It remains for us to create our own reference points, much as early navigators sailed using celestial relationships. More on this in this one-hour lesson, plus the usual hunt for real-time trade set-ups.

Seasonality will be heavily on bulls' side ahead of Labor Day weekend, but stocks will be bucking powerful headwinds thereafter, since September is historically Wall Street's worst month. This September will be particularly interesting if two fledgling trends gain momentum. Specifically, the dollar has turned up from a promising spot, and AAPL for a rare change closed lower on the day. The psychotic spasms that undercut Apple shares apparently were caused by news that euroland's regulators are taking a close look at the company's app store. Investors have reason to be fearful, since it is a monopoly business that makes Microsoft's criminal lockhold on web browsers 25 years ago look like pattycakes. The dog-bites-man story of the day was the oh-so-sly rotation of money into the Indoos and the S&Ps. With AAPL getting hit, DaBoyz took OPM ordinarily earmarked for the FAANG/lunatic sector and pumped it into the broad averages. Another day or two of this and the parabolic blowoff that has seized the Nasdaq 100 will infuse itself into the Dow Average and the S&P 500.

AAPL went all spastic on Wednesday, apparently because the quasi-criminal monopoly of its app store is drawing intense scrutiny from eurolands's notoriously zealous regulators. They've proven time and again that they can be bought off, but there is understandable concern that any bribe paid these extortionists will be in painful proportion to AAPL's $2 trillion-plus valuation. The wack-jobs powering Apple shares higher, famously including the central bank of Switzerland, will shrug it off in a day or two if not sooner so that AAPL can return in earnest to the urgent mission chosen for it by the U.S. Government: making all the pension funds that hold the stock appear solvent for as long as possible. From a technical standpoint, it is mildly bullish that the top of Wednesday's schizoid spike slightly exceeded a very clear Hidden Pivot target at 135.96. Let's see how long the correction lasts before we bull up with gusto for the next stab higher.

We're using a 3769.00 bull market target that comes from the weekly chart, but more immediately, the 3651.75 target shown in the thumbnail inset can serve as a minimum upside objective for the near term. A pullback to the green line would trip a 'mechanical' buy, stop 3484.00, but it seems unlikely, given the very steep pitch of the futures' ascent. Even allowing for the fact that this is the most powerful rally in history, I was surprised nonetheless to see it take out double resistance I'd noted earlier about 30 points below. It were as though the two pivots were chopped liver. Chalk it up to mass mental illness that is equal to some of the most famous outbreaks of craziness in history, including the South Sea Bubble of 1720 and Tulipomania. The dollar consequences of this episode undoubtedly dwarf all of the others put together, mainly because it is global in scope.

An interesting day, Hidden Pivot-wise. AAPL topped 0.03% from a rally target I'd drum-rolled before the split, and the Dollar Index bounced sharply from within six cents of Hidden Pivot target that's backstopped by a major trendline. Odds are against nailing the exact high in AAPL, which in dollar terms  is being driven by the most powerful and consequential buying mania in history, but we'll have to see what the new day brings before we write off the target as just another flash-in-the-pan. The important thing is that many subscribers evidently made hay as AAPL rampaged toward the rally target. If the stock and the dollar have in fact begun major reversals, that would be a very big deal, since every other lunatic trend in motion since March is about to reverse as well.  The Nasdaq 100 did not look toppy at all, but that hardly negates the possibility that it is about to plunge into the molten pit of hell. Regardless of which side of the craziness you're on, you can cross your fingers and root for a satisfying outcome.

AAPL didn't waste any time demonstrating why DaBoyz split it four-for-one, effective Monday morning. The stock was up a scandalously undeserved $6.18 at one point, or more than 5%, although the gain was not nearly as noticeable as it would have been prior to the split. The pre-split rise would have been $24.72, making it one of the most powerful rallies in recent memory. It won't be remembered that way, however, since the $4.16 closing gain is just not a very impressive number.  What is impressive is that it put about $70 billion more dollars into the financial ether, inflating pension and sovereign funds sufficiently to feed, house and clothe California's six million retirees from now until Christmas. The stock still has a little ways to go before it reaches the 134.37 target we've been using as an upside objective. At the rate it's going, AAPL could be there by Wednesday. Better watch this one closely, because if the shares are topping, so is the stock market. The big question is whether the bull market can be stretched out for long enough to allow DaBoyz to cash out of other megacap stocks that they are immersed in up to their eyeballs: TSLA, AMZN, GOOG, CMG, NFLX.  Hedge funds and pension funds have trillions of dollars locked up in these stocks, and they desperately need to unload them on the rubes, since they offer horrible value at these levels. Keeping the market levitated for the year or two it could take to split and reprice them for the hoi-polloi will be be quite a trick, even for the Masters of the Universe.

Index futures and bullion have opened moderately higher Sunday evening, suggesting DaBoyz are in no hurry to lighten up on inventory.  I'll weigh in later this evening when there is more evidence to judge the mood of investors, but at the moment, they seem quietly confident. I have provided some ambitious rally targets in my latest tout updates below, and there should be little doubt they will be achieved. ______ UPDATE (Aug 31, 12:22 a.m.): What began as a quiet rally has turned into yet another bear squeeze that could exhaust shorts by dawn. At that point the E-Mini S&Ps could be trading at the 3545.50 target sent out earlier, spent but incapable of pulling back to any significant degree.