Uptrending ABCDs in every time frame are driving rates on the 10-Year Note inexorably toward the 5.30% target shown. The run-up could accelerate, since Bessent's abortive experiment last week with quantitative easing laid bare the futility of trying to suppress rates in an environment where private credit is rampant and government debt is at $40 trillion and rising. Gold doesn't like higher rates, but in this case, bullion is reacting more to the gathering crisis than to monetary conditions. Yields and gasoline prices are not going to let up before November, and that is why we are about to experience a regime change. The greedy scumwads who control the markets have been quietly distributing as much stock as they can to widows and pensioners before the jig is up. With help from their ignorant shills at all of the major news media outlets, they even managed to short-squeeze the S&Ps and the Dow to new all-time highs in the face of a perfect storm of bear market hazards. That is what bull traps are all about, and why you should shun the party. (See my chat room post about TLT, a solid, dividend-paying alternative that is close to bottoming.)
Switching to the October contract, I've used a conventional pattern and a conservative target to project imminent upside to at least 88.96. The next resistance would be somewhat higher, at 90.70, a Hidden Pivot derived from shifting the point 'A' low down to July's 70.89 print. Any higher would require a pattern derived from a longer-term chart. Here it is, and the highest price it can project is 102.60. If correct, it would imply that the Hormuz standoff will end, although predicting exactly how seems beyond the capabilities of the punditry or even Trump himself.
The chart presents a moderately bearish picture for the near term that is further mitigated by bears' struggle on Friday to hold the futures beneath the midpoint support at 7677.25. They ultimately failed, implying that any additional progress down to d=7516.00 will be challenged by dip-buyers every step of the way. I expect this gasbag to flirt with record highs for the next month or so, buoyed by short-squeeze head-fakes whenever DaBoyz get the chance. At the same time, weakness in the Lunatic Sector will persist, with little likelihood that the egregiously misnamed Magnificent 7 will make new highs. In summary, this describes a 17-year-old bull market ending with a whimper rather than a bang. All that will change when the dip-buyers are confronted with an avalanche that will make the covid sell-off look like tea and crumpets.
The moderately bearish picture shown is congruent with the one accompanying the ES tout (see above). I could have used a larger pattern to project a lower target, but I'll give the bull the benefit of the doubt because I do not believe DaBoyz are ready to pull the plug on this decrepit bull market. Most immediately in MSFT, minimum downside to at least d=461.36 is all but guaranteed, given the way sellers crushed the midpoint support at the beginning of last week. But 'camo' bottom-fishing is strongly recommended there, even if only to leverage a bounce that could be short-lived.
December Gold looks like 90% shot to reach the 4819.30 target shown. But then what? Assuming the rally exceeds the Hidden Pivot resistance and closes above it for at least two consecutive daily bars, that would shift our focus to 5705.90, the 'd' target of a larger pattern begun from 4091.50 on October 28, 2025. A related 'secondary' HP (p2) at 5283.30 would then serve as our minimum price projection, and there would be no reason to doubt that this move in bullion is the real deal. Notice, however, that achieving 5705.90 would leave the futures just shy of the record 5781.80 recorded last January. I cannot guess what that might portend, but we'll consider the possibilities when the time is right.
Last week's poke above the 69.215 midpoint resistance shown in the chart is encouraging, since it shortened the odds of a further push to the 83.430 target. If the futures can make it two weeks in a row, they will be no worse than a 60% bet to reach 'd'. In the meantime. they are already set-up for a 'mechanical' buy on a sharp pullback of around $7. I will signal the opportunity if and when it comes, but it would be telegraphed by a $2.18 decline from any high. That number can be used as a trigger interval (TI) to get short, but you should do so only with a small-pattern (i.e., 'camo') set-up, since a mere $1.00 move against you would be $5,000 down the toilet.
Bulls turned the 124.90 midpoint resistance into tapioca last week, leaving no doubt that the 159.97 target will be achieved. It is congruent with the ambitious target I've proffered for Gold (see above), and bolsters the likelihood that both will hit their marks. A relapse to the green line (x107.37) in the interim would be widely viewed as bearish, but from our perspective it would be a terrific opportunity to augment a long position or get aboard belatedly. Friday's high fell just shy of a voodoo resistance, but a pop above mid-April's 136.55 peak would remove it for good.
Trump has made a deranged mess of crude's chart, although I have displayed only a small, simple piece of it to illustrate this week's tout. It implies that Sep Crude should be shorted if it hits the green line (x=87.81), and that a 93.51 stop-loss just above the pattern's 'c' high be used to manage entry risk. (I have obscured the pattern's origins for proprietary reasons.) I am recommending the trade only to subscribers who know how to craft a 'camo' trigger to enter. It is predicated on a fall to 70.72, the 'd' target. 'Camouflage' entries are discussed in the Hidden Pivot Course I've made available free to all legacy subscribers and new ones who sign up for a full year. The course once sold for as much as $2500 and was conducted "live" around the world. ______ UPDATE (Aug 20, 8:25 a.m.): With the futures trading nearly $2 above x=87.81 and not retracing even slightly, the hourly chart implies that a visual TI of 47 cents would be appropriate for getting short. The trade hasn't triggered yet but based on the so-far high at 89.00, it would do so at 88.53, with half t0 be covered at 88.06. The nearest resistance is 90.35, a somewhat dubious 'd' that I would not lean on too heavily to cap the move. If the short-squeeze pushes easily past it, that would open a path most immediately to 97.06, a new contract-high. The equivalent number for the October contract is 90.76, which would fall just shy of May's record 91.27. This anomaly is due to backwardation's effect on the ABC coordinates I've used for the respective contracts.
DaBoyz spent most of the week screwing the pooch, waiting for more Hormuz twaddle from Trump to help them jack the markets, or for a headline speculating that the Fed might be less inclined to tighten for whatever reason. The latter helped foment a middling, 60-point short-squeeze on Thursday, but by week's end stocks appeared to be settling back into their wonted state of constipation. Not that that will make them any less tradeable: Bottom-fish 7778.50 with a tight stop if you're around when it's hit. (Note: When I say "tight," I mean to imply that you should use a small pattern 'camo' trigger to initiate the trade, and that it risks no more than small change to get you on board.) Concerning the bigger question of whether we are in a bear market, bull market, or a sideways correction, it can be answered much more easily than you might imagine, using the simple chart shown. If the September contract falls to the green line without having exceeded 7838.50 first, that would imply bulls are taking a long overdue rest. Expect the fall to hit p=7676.00 at least but watch out below if they impale it on first contact. An easy breach of d=7613.75 would be the most bearish sign the S&Ps have flashed in a long while. One final note: Consider my Microsoft tout (immediately below) alongside this one, since the stock remains a key bellwether for the long-term bull market.
The easy blast through p=449.09, the Midpoint Hidden pivot, leaves little doubt as to whether the stock will reach the 548.98 target shown. The bad news for bulls is that it would fall just a tad short of the record 555.45 achieved last August, implying this is 'just' a bear rally, albeit a very impressive one. It would be psychologically impressive as well, since permabulls would be licking their chops, and bears will already have thrown in the towel. What a splendid trap that would be! If a relapse to the green line occurs, it would effectively signal a bear market. And although we should be prepared to bottom-fish down there anyway, it should be with expectations of enjoying only a one-level bounce to the 559.09 'p' midpoint. We should also consider a 'mechanical' buy at the red line (p=449.09) if the opportunity develops.
