The September contract overshot the 4471.00 target shown by a relatively small 22 points, but that's enough to imply that the so-far modest retracement is just that -- a correction to be bought rather than feared. We should not simply jump back in, though, without testing the water. Even if the downtrend accelerates, though, it should be easily tradeable in either direction using the reverse patterns that have become our workhorse. For now, use the 4369.00 target shown here as a minimum downside projection and a place to attempt bottom-fishing as the new week begins. _______ UPDATE (Jun 26, 11:53 p.m.): The futures have bounced 12 points after bottoming just two ticks (0.50 points) from the 4369.00 target flagged above. The low occurred at exactly 4:00 p.m., however -- a time of day when I am disinclined to open a position that would put my peace of mind at risk during the evening. If you did the trade, though, I'd suggest being out of at least half of it at current levels. Please let me know in the chat room so that I can determine whether to provide further guidance. ______ UPDATE (Jun 27, 9:43 p.m.): The futures extended the rally with a wilding spree that topped 55 points above the 4369 low where I'd suggested bottom-fishing. With the Fourth of July holiday approaching, bullish seasonality will be at gale force.
The rally's second stage was shaky at the outset in early June, but it now looks as though this T-Bond proxy will reach D=104.41, the minimum upside objective since June 15, when TLT gapped up through a Hidden Pivot midpoint resistance at 102.60. We should play close attention to the way buyers interact with the target, since it could tell us whether the bond rally is likely to get legs. An easy move through 104.41 or two consecutive daily closes above it would be the most bullish sign we've seen since March.
With 'Doc' Copper tiptoeing higher, we should prepare for a possible opportunity to short the July contract 'mechanically' if and when the futures get to the green line (x=4.026). The week ended on a downstroke that would require a last-gasp rally to reach our goal. This is a potential $65,000 winner on four contracts, with commensurate entry risk, so we would want to initiate the trade with a 'camouflage' trigger capable of drastically shrinking the initial exposure. I have no indication that subscribers trade this vehicle, but please let me know in the chat room if you're interested. _______ UPDATE (Jun 28, 5:56 p.m.): The shorting opportunity is past, since the futures have sold off hard since narrowly missing our offer. The 2.956 downside target noted here earlier remains in play.
August Gold looks bound for a minimum 1903.90, but if that Hidden Pivot support gives way, look for the downtrend to continue to at least 1875.00. (A related p2 support at 1906.40 could also engender a precise, tradeable bounce). Both of those numbers can be bottom-fished with 'reverse' patterns and a theoretical trigger interval of $11. Since that would imply entry risk of more than $4000 on four contracts, you should initiate the trade only via an rABC set-up on the 15-minute chart or less and initial risk held to no more than $200 per contract.
July Silver caught a bounce from the 22.06 secondary Hidden Pivot last week, but that won't save it from a further fall to the 21.205 target shown in the chart (inset). That much is clear from Wednesday's crushing breach of p=22.91. The pattern looks too obvious to deliver a precise bounce, but a tradeable turn from very near the target seems unavoidable. So far, the 'natural' trigger interval on a reverse-pattern entry would be 25 cents, but we'll look for alternative ways to get aboard (i.e., 'camouflage'), since the implied entry risk on four contracts would be around $5,000.
Relentless weakness since mid-April finally triggered the 'mechanical' buy at x=35.58 that we've awaited for a month. Such signals are supposed to come at times when they are unappealing, but in this case the opportunity, such as it is, looks so dim that I'll suggest waiting for lower lows before we attempt an entry. With bearish forecasts for both gold and silver futures in force, and the prospect of a further decline in this vehicle to C=32.25, there is no rush to get aboard.
The Dollar Index rallied just enough last week to trigger a 'mechanical' short at the green line (x=102.80). The trade is predicated on further slippage to at least D=98.71, the target of a bearish pattern measured from November 2022. Just to get on record with this, there is room for even more weakness down to as low as 93.55. That's a Hidden Pivot support derived from a higher point 'A', the 113.15 peak recorded a couple weeks earlier in November 2022.
Inflation is being crushed from the system by vastly larger forces of deflation that have been lurking for decades. Although we might have expected the trillions in funny money that were force-fed into the U.S. economy during the covid era to have a longer-lasting effect on prices, inflation never had much of a chance. With real and nominal mortgage costs rising, home prices have begun to fall sharply, along with rents, used-car prices, gasoline and even some basic grocery items such as milk and eggs. Real estate is the 800-pound gorilla, though, because it is the chief source of loans that are destined to implode. This is particularly ominous for the commercial sector, since even the sky-high rents that still obtain in New York City, for one, are proving insufficient to service borrowing costs. Residential real estate will not be far behind, however. The median price for existing homes fell 3.1% in May, to a still-pumped $396,100, from a year earlier. We have some catching up to do with Germany, though, where even higher mortgage rates and official recession have caused home values to fall by a record 6.8% year-over-year. The 800-pound gorilla will ultimately be dwarfed by King Kong himself as the biggest cities in America spiral toward economic doom. This will be a key feature of the Second Great Depression, which awaits only an end to the nutty rally on Wall Street to commence. A very run-down San Francisco seems likely to lead the pack, but don't expect New York, Chicago, L.A. et al. to fare much better over the long run. The cities will collapse economically on three levels: above ground (i.e., skyscrapers); at ground level (virtually all amenities, from hot dog carts to concert halls); and below ground (subways, with fixed costs that include $90,000 retirement
The September contract has signaled an all but certain rally to the 4576.25 target shown in the chart (see inset). The pattern is unorthodox but meets our all of our criteria for usability. Most immediately, it would enable a compelling 'mechanical' buy following a corrective swoon to p=4396.13 (for which a 4336.00 stop-loss would apply). A deeper retracement to the green line (x=4306.06) would be even more enticing as a place to bottom-fish. One or both of these numbers could conceivably be reached, since, as I've detailed elsewhere on this page, two bellwether stocks look ripe for punitive corrections.
AAPL appears very likely to achieve the 191.73 target shown in the chart (inset), since the stock has spent two weeks above the Hidden Pivot midpoint (p=184.53) after impaling it on June 15 with an opening-bar gap. A swooning retracement to the green line (x=180.92) would trigger a 'mechanical' buy that you should not pass up if you trade the stock. Nudge me in the chat room when appropriate and I may be able to craft a risk-averse trigger for playing the bounce with call options.
