Bertie has spent the last two weeks trying to build a bottom at the 19,148 'secondary pivot' shown in the chart. However, the earlier, decisive breach of the 23,550 midpoint Hidden Pivot support suggests the effort will fail and that this bitcoin proxy is headed down to at least 14,746, the pattern's 'D' target. Presumably, that is where it will build a base sufficient to support a short squeeze of perhaps $8,000 or more. For now, though, it should be traded with a bullish bias. ______ UPDATE (Jun 29, 1:47 p.m. EDT): DaBoyz are propping up bitcoin to offload as much of it as they can at $20,000. They won't be able to pursue this project indefinitely or with much success, since there are so many losers trapped at higher prices. A stock market rally could bail them out, at least for a short while, but that ain't happenin', at least not today. The chart shows an interim target at 18,041 to keep in mind as Bertie makes its way down to bigger-picture targets noted here earlier at, respectively, 14,746 and 9,507. _______ UPDATE (Jul 5, 11:59 p.m.): Last week's low at 18,635 came within 1.2% of the 18,041 target flagged above. Bertie has become a pathetic follower of market trends, a big change from the days when it led and reflected speculative fever. It has become too boring to track and there is zero interest in the chat room, but I am leaving it on the list because, well, because. ______ UPDATE (Jul 7, 6:20 p.m.): Because bitcoin was demoted from speculative investment to scandal in the wake of its collapse since last November from $69k to sub-$20k, the fact that it rallied more than $1000 today suggests there is real power behind the stock market's short squeeze. We'll pay close
The Dollar Index is working on a red-line 'mechanical' buy that was profitable the day after it triggered on June 16. The trade, which is predicated on a 106.49 rally target, is still in the black, but my hunch is that a better entry opportunity awaits when this vehicle falls to the green line, 102.80. In the meantime, although we hold no position officially, we can continue to monitor DXY closely for signs of presumably moderate weakness.
The chart above is intended to take some of the guesswork out of determining how high this presumably doomed stock-market rally is likely to go. Not very, would be my guess. I say the rally is doomed for a few reasons, none of which has anything to do with a U.S. recession that began months ago, or a real estate collapse that is still in the anecdotal stage but quite real and menacing nonetheless. My assessment is based purely on certain subtle technical signs evident in the chart. First is the S&Ps' breach of a 3656 'external' low recorded back in February. The overshoot was just 17 points, or 0.46%, but that was sufficient to generate a strong impulse leg of weekly-chart degree. What it implies is that any rally off the June 17 low will turn out to have been corrective -- or to use a more descriptive word, distributive. Since we 'know' the rally is just a bear squeeze, predicting where it is likely to apex is possible. I have used a 'reverse-pattern' feature of the Hidden Pivot Method to calculate prospective rally targets at, respectively, 3966 and 4028. If the S&P mini-futures were to exceed the first by more than 5 or so points intraday, that would imply more upside to the second. Both are bound to show stopping power sufficient to be short-able, and that is what I would suggest to Rick's Picks subscribers. Sidestepping a Possible Stampede This scenario is by no means chiseled in stone, and I would be inclined to give the rally wide berth if it impales the higher number the first time it is touched. That would suggest that a bear rally worthy of the name is under way. If so, it could be expected to continue to whatever height is
The chart is intended to simplify your trading decisions and mitigate the anxiety that has stalked the chat room lately. Is this the big short squeeze we've all known was coming? I doubt it. But why should it matter? It's all just impulse legs, and the one shown has generated 'mechanical' levels that can be traded or used confidently to assess the strength and sticking power of the rally. For starters, if buyers impale the 3804.00 midpoint (p) over the next day or two, and especially if they close ES above p, you can bet that it's going to reach D=3969.00. Any one-level pullback enroute will be tradeable 'mechanically' once p has been exceeded, but check in the chat room if you're uncertain about how to do this, since many have mastered the trick. It will a require 'camouflage' set-up on the very lesser charts, since conventional entry risk would be around $2500 per contract. ______ UPDATE (June 22, 9:15 p.m.): The rally reached p=3804.00, overshooting it by a zillionth of an inch. This confirms that the pattern will work for any purpose we choose, whether forecasting, trading 'mechanicals' or shorting at D. ______ UPDATE (Jun 24, 12:25 a.m.): After spending two days ineffectually head-butting p, DaBoyz had to cheat to push past it under the cover of darkness. This put the futures on a certain path to at least 3886.50, the secondary (p2) pivot.
Bears turned toothless on Friday, but neither that nor a voodoo forecast in the chat room of a big rally could overcome the crushing weight of the pattern shown. It projects a further fall of 180 points, to 3502.50, before this minor phase of the bear market begun on January 4 has run its course. Bulls might be tempted to imagine the worst is over if the big rally actually occurs and reaches the green line (4029), but that would merely trigger an appealing 'mechanical' short predicated on a relapse to 3502. That target still looks very likely to be achieved, given the way sellers vaporized the 3853 midpoint Hidden Pivot support the first time they encountered it on the way down, on June 14.
Oil got pummeled as the week ended, but it is too early to tell whether the move will prove impulsive or merely corrective. Regardless, if the futures were to fall to the green line, that would trigger a 'mechanical' buy I would rate a fetching '7.7'. That implies the July contract would rebound to at least to p=114.33 before falling beneath C=88.53. The longstanding target at 140.12 will remain viable until such time as C is breached. My hunch is that a reverse-pattern bid with the 'c' anchored near 107.00 would work if you are trying to bottom-fish a short-term low. ______ UPDATE (June 21, 9:42 a.m. EDT): Here's a chart for the August contract, with the green line relocated to 98.84.
I'd suggested paper-trading the 'mechanical' short at 1851.10 that triggered last Thursday, but the point of the exercise was to underscore my advice that any rally not be taken too seriously. This one came off a low at 1806.10 hit on Tuesday, and the trade became theoretically profitable the next day with a so-far moderate reversal. The price target is 1756.9o, a Hidden Pivot support that can serve as a worst-case objective for the next 7-10 days. _______ UPDATE (Jun 22, 9:20 p.m.): Gold's price action can be best understood if you see it as a Bill Cosby girlfriends, unwittingly drugged and in a deep stupor.
July Silver futures tripped a 'mechanical' short last week similar to one in gold that went profitable the next day. The trade is predicated on a further fall to 19.64, but in theory taking a partial profit would be warranted at p=21.10. The initial move down to p breached this Hidden Pivot support but not by much, implying that the C-D follow-through leg currently in progress is less than certain to achieve the 19.64 target. We'll be better able to judge the odds of this once we've seen the downtrend interact for a second time with the pivot. For now, though, you can use p2=20.37 as a minimum downside objective.
TLT has rallied modestly after penetrating a longstanding and potentially important Hidden Pivot support at 108.74. It's too early to say whether a bottom is in, but we should remain open-minded to the possibility. If so, it would leave a 3.56% upside target for interest rates on the Ten-Year Note unfulfilled, albeit with just a small, presumably tolerable discrepancy. TLT would need to hit 115.79, surpassing a peak recorded on June 7, to generate a moderately powerful impulse leg on the daily chart.
A week of pussyfooting at the 21,318 midpoint support has given way to a so-far modest breach, but the damage looks significant enough to eventually send this bitcoin proxy down to at least 15,800, the 'secondary' Hidden Pivot. Further downside progress to D=10,282 is not yet a done deal, however, even though there is an even lower target at 9507 that was noted here earlier. If Bertie should rally first, it would offer short sale rated at around 7.3 at x=26,836, stop 32,355.
