Rick Ackerman

June Crude has tripped a moderately appealing 'mechanical' buy signal, but we'll use it to get our bearings rather than try for a quick score. Pullbacks to the green line from the secondary Hidden Pivot (p2=63.66) are riskier to buy 'mechanically', at least for a move back to the target, but the set-up is often good for a one-level ride, in this case from 57.67 to 60.66. It's too late to jump aboard, since the futures are already trading above x=57.67. Still, I'll suggest observing what happens next to familiarize yourselves with the trade and the opportunity big retracements can create..04

The futures were bound for the 5787.25 target shown when the closing bell ended Friday's v-shaped rally.  The implied 4.2% gain would put the June contract within shooting distance of old record-highs just above 6200.  A move to 5787.25 seemed assured when the trading week ended, since the intraday low occurred precisely on a Hidden Pivot midpoint support. Strong uptrends are supposed to produce weak retracements, according to the rules of my system, and that perfectly describes what happened on Friday. There could be an opportunity to scalp a pullback from p2=5623.00 on the way up, but your trading bias should remain bullish otherwise.

MSFT should have little difficulty reaching the 400.26 rally target early in the week. If the 'D' target were not such a juicy round number, I'd recommend shorting there aggressively. However, many traders will be counting on it to halt the stock's ascent temporarily.  The bar that pushed the stock past p=378.06 was bluntly decisive, implying you could buy the stock anywhere above C=355.86 and be confident of cashing it out eventually at 400.26. For better risk management, though, you should try to get long using a 'camouflage' trigger from the 5-  or 15-minute chart.

As last week began, rates on the Ten-Year Note looked ready to jump to 4.58% from an already uncomfortable 4.40%. Instead, they eased sufficiently to suggest the trend will continue down to 4.09%, the 'd' target shown in the chart.  That might be the most we can hope for, but if the weakness penetrates the 'hidden' support at that level, it could portend more slippage to 4.07%, or even 3.90%. These are somewhat different from the potential lows we were tracking earlier, but the graph looks equally capable of giving us an accurate read over the next 3-5 weeks.

The pattern shown, with a target as high as 130,189, is good enough for government work even though I've settled on an indistinct point 'A' low that could muddy the D target. Regardless, as I've mentioned before, the midpoint pivot is a reliable telltale even when it is embedded in a dubious or too-obvious pattern.  It lies at 102,305 here, and so we'll make that our minimum upside objective for the near term.  A decisive push through it on first contact would, of course, shorten the odds of a follow-through to at least p2=116,247, or 130,189 if any higher.

So many traders evidently anticipated Friday's low that the futures never got there. The peanut gallery would have been focused on Wednesday's 3270.80 bottom as a logical place for a test of support. It was not to be, however, and my 3264.60 midpoint support finished even further out of the money when the June contract turned higher from 3274.80, a number in the middle of Nowheresville. The subsequent bounce was impulsive on the hourly chart, implying bulls had a reason to hold a position over the weekend. This seems a little too pat to me, but I won't let skepticism cloud my thinking if bullion wants to go higher when the futures start trading again Sunday afternoon.  _______ UPDATE (May 1, 12:52 p.m. EDT): Gold’s weakness appears to be merely corrective, and you can therefore expect an upturn from no lower than 3174.50. That’s a Hidden Pivot support that lies about $80 below the current price, 3225. A second possibility, dimming at the moment, would be for this morning’s so-far low at 3209.40 to support a strong rally. That’s a ‘secondary’ Hidden Pivot, and it is capable of turning things around. The so-far moderate decline since April 22 occurred after June Gold peaked within 0.6% of a 3533.90 Hidden Pivot I first featured here when the futures were trading below $2800. It stood to be a potential stumbling block, and that has been the case. However, I doubt that gold has topped for good and expect it to reach $ 5,000 an ounce or more eventually. 

The pattern shown, with a big-picture rally target at 35.445, has kept us in close harmony with the trend, but it never promised much satisfaction. Pullbacks haven't been sufficiently robust to trigger any 'mechanical' buys, and a short from d is unappealing because the target coincides with some prior peaks that are certain to attract a crowd. That doesn't mean the pattern is untradable, but it takes work. Mainly, it's a matter of hunkering down on the lesser charts to derive entry triggers from them.  The daily chart yielded up a fat-looking one at 32.565, but the turn from 15 cents above it suggests it may have had a fan club.

Last week's gap through p=62.17 all but ensures that the downtrend will achieve the 57.53 target. The good news is that the pattern is just opaque enough to deliver a tradable bounce from somewhere very close to d. It is also sufficiently compelling to make a move significantly below 57.53 unlikely, at least initially. GDXJ will have taken a month to get there, so even under the most bearish assumptions, it would need to hang out in an around 'd' for at least 4-7 days before breaking down.

The Dollar Index triggered a 'mechanical' short when it rallied to the green line as the week began.  The signal would rate a 6.0 out of  10, since the low that preceded the rally was distant from our sweet spot, even if it did touch the red line. I am leaning bearish, but if DXY blows past C=100.28 toward the beginning of the week, we should give the move the attention it deserves. The greenback is long overdue for a rally, and there's nothing to say it can't start here. Worst case for the near term is 95.79, the 'D' target of the pattern shown.