Last week's thrust above an important midpoint Hidden Pivot resistance at 80.61 was a menacing sign, since prices at the pump were already in a steep climb since dipping very briefly below $3 a gallon in some states just weeks ago. I bought 93 octane as cheap as $2.89 within the last two weeks in North Carolina but was surprised to pay $3.99 in a South Florida Costco this morning. If Friday's close for September crude above 80.61 portends more upside to D=98.82, we will likely see $5 gas. Taxifornia has already experienced much higher prices than that, but it would be unfamiliar to motorists in the East outside of New York and some other blue states that have increasingly been penalizing gas-fueled vehicles.
We need to keep reminding ourselves that even during those frustrating cycles when gold is being treated like garbage by investors, it is still in a long-term bull market. However, it has been so slow in developing that even hard-core bulls will find their patience tested to the limit. Accumulation is the strategy of choice, coupled with perseverance and discipline to make the ordeal seem worth the wait. To that end, we should be prepared for the correction begun from May's all-time high at 2112 to come down t0 at least 1908 before bulls are sufficiently rested to mount another charge (of the Light Brigade?). The corrective segment shown in the chart has yet to trip a 'mechanical' short, but it would on a rally to 1983.40. Check for details in the chat room if the set-up should ripen, since the $10,000 theoretical entry risk on four contracts can be cut by 95% if we do it right.
Although silver has grazed over a nearly $12 range for the last two years, it prefers to hang out near the $24 midpoint. To be sure, it is in a bull market with the potential to reach $36 or higher. But it seems in no hurry to get there, and it will likely remain an accumulation opportunity between 17 and 23 for the foreseeable future. A breakout would be signaled at 27.36, a tick above an important 'external' peak recorded by the September contract in March 2022. More immediately, a reverse pattern promises good odds for bottom-fishing at 22.98. That is the 'd' target of a= 24.83 on June 9. _______ UPDATE (Aug 8, 9:49 p.m.): Sellers bombed the 22.98 Hidden Pivot support, implying Sep Silver is likely to grope its way down to June's 22.34 low in search of support.
Will GDXJ's dip last week beneath the green line (x=35.58) generate another profitable 'mechanical' trade? This has already happened twice if you count the May 25 low at 38.79 that missed touching the green line by a relative smidgen. For purposes of bottom-fishing, however, we needn't risk much, even if this vehicle is destined to fall beneath C=32.25 of the big, bullish pattern that promised to deliver 45.56 since March. It is a promise that we should no longer take too seriously, given this symbol's punk performance since early April.
I'm not a big believer in this rally, so I've used a modest pattern to project a potentially important top in the uptrend, now three weeks old. It is slightly lower than a 103.50 projection given here earlier that was related to some previous highs. I'd suggest shorting at D=103.24, but there may be a 'mechanical' buying opportunity first at x=100.50. If it sets up correctly with a low-risk, reverse-pattern trigger, plan on a one-level ride but no more.
Last week's commentary said the first big correction of 2023 had a ways to go, and that is still the case. If there were any doubts about this, Apple's swan dive Thursday on punk Q2 earnings released after the close should have dispelled them. The most valuable stock in the world fell by nearly 5%, shrinking the global 'wealth effect' by around $144 billion. This is unlikely to weigh on yacht sales as summer heads into the final turn, but it could impact them eventually if the stock, and few others favored by portfolio managers, fall to the worst-case targets on some of my charts. Goggle Porn It was word of a third straight quarter of falling revenues that upset investors, and innovation alone is unlikely to arrest the decline. That's because without Steve Jobs, the company has been unable to innovate its way out of a Glad bag. iPhone improvements have come mainly in the form of improved cameras and better batteries, but the wow factor has been lacking. The company took a stab at it with the introduction of a pair of $3500 virtual reality goggles a few weeks ago, and although the technology was impressive, consumers still seem to have doubts about whether it's cool to turn on, tune in and drop out with your head in a plastic shell. If and when the Visual Pro goggles are tweaked to deliver a satisfying sexual experience to perhaps three or four of our five senses, that's when sales will take off no matter what the price. In the meantime, AAPL stock will continue to fall, taking the broad averages down with it until its deep-pocketed sponsors sense that sellers are exhausted. Then the gaseous wafting cycle will begin anew as short-covering and gap-up openings circumvent the need for
Just when it looked like prices at the pump were going to ease below $3, this nasty little sumbitch poked its snout above the transom and was threatening to take out some important peaks recorded since last November. The most important of them, an 83.59 high notched on November 7, seems likely to give way if a 'voodoo number' at 82.52 is easily penetrated to the upside. Perhaps the increase in energy costs this would produce is the reason why the stock market looks ripe for a fall? We may be better equipped to answer the question by week's end if not sooner. ______ UPDATE (Aug 2, 9:10 p.m.): The futures have plummeted after ratcheting up to within an inch of a voodoo number that got some play among advanced Pivoteers on Monday. More is needed to bring relief at the pump, but it's not clear yet whether sellers have the guts to bring crude quotes down into the low-$70s.
The failure of the September contract to reach the 4645 target shown before turning down sharply is not a healthy sign. It suggests that the correction begun from last week's 4634 high could fall as far as the green line before buyers are fully recharged. At a minimum, the decline should come down to the red line, setting up a theoretical 'mechanical' buy hat would take a 4461 stop-loss. Stay tuned to the chat room for more-detailed guidance if the trade should get close. We should also monitor Friday's vicious short-squeeze diligently, since this market has been surprising us for years by making new highs at times when meaningful technical indicators are beautifully aligned for big selloffs. In this case, a platoon of chartists appears to be focused on a well-defined channel that closely caught last week's high. _______ UPDATE (Jul 31, 10:56 p.m.): A thousand chartists, ever hopeful of catching The Big One, were firmly aligned at a seemingly impregnable channel line that caught last week's top. However, it would now appear that The Thing That Wouldn't Die is about to impale the resistance as it has dozens of times before. A few more Hindenburg Omens ought to stop the beast, right? ______ UPDATE (Aug 2, 9:14 p.m.): A wave of selling saved the day, sending this gas-bag sharply lower while generating a robust impulse leg. That implies rallies over the near term will be corrective and therefore shortable, so you should stay tuned to the chat room if you trade this vehicle. _______ UPDATE (Aug 3, 9:23 p.m,.): Amidst today's airy, bullish spasms, there seemed to be no easy way to get short -- a strong sign that the next big move will be down. This would be affirmed if the futures finish the week at or near the intraday
The Svengalis who control the stock failed on Friday to gap it above any previous peaks on the hourly chart, so I've hoisted the yellow flag. It is unusual for them to miss in this way, but we should never count them out, since they have mastered the trick of pushing the world's biggest-cap stock sharply higher on little more than hot air. It would take a fall all the way down to 189.63 to generate a bearish impulse leg on the hourly chart, but until such time as that happens there is little justification for having a strong bias in either direction. ______ UPDATE (Aug 3, 9:28 p.m.): Earnings out after the close were strong, but it was the punk outlook that caused a perverse leap to as high as 196. It is the after-hours low at 185.00, however, that will likely set the tone for the week ahead.
Every dog has its day, so perhaps that explains why bowser has been forging higher since mid-July. The pattern shown projects to at least 102.18, but we'll need to see how bulls handle the resistance before we are able to judge whether the rally will get legs. Judging from the way a hypothetical 'mechanical' buy at the red line (p=101.37) took off without probing any lower, DXY appears to be a very strong bet to blow past D=102.18. Speculative call buying is warranted, although I am unable to provide precise guidance ahead of Sunday evening's opening. ______ UPDATE (Aug 2, 9:19 p.m.): A fresh impulse leg on the hourly chart promises to keep this rally going, presumably to a test of highs near 103.50 recorded in late June and early July.
