Rick Ackerman

We'll start the week with a modest rally target at 3998.00, given the futures' tortured progress last week toward heights unknown.  The next 100 points would offer little resistance, since most of it traverses a nearly crag-less El Capitan created by the steep downdraft during the second week in June. Balky as July's uptrend has been, it has yet to provide any 'mechanical' buying opportunities tied to the pattern shown. A swoon on Monday to the green line (3805.25), however unlikely, would generate a 'mechanical' buy, stop 3741.00, but I cannot recommend the trade until I've seen how DaBoyz open index futures Sunday night. ______ UPDATE (Jul 11, 9:40 p.m.): The trade looks appealing enough to rate a '7.4'. However, with nearly $13,000 of initial risk on four contracts, it is recommended only to Pivoteers who can cut that down with 'camouflage' to no more than $300 theoretical per contract.  If the trade is setting up during Tuesday's Q&A 'bonus' session for recent 'mechanical' course registrants, we'll give it a shot. ______ UPDATE (Jul 12, 5:14 p.m.): The trade triggered in the final hour, so let's see how it goes. It will produce a theoretical profit of about $13,000 if p=3869.63 is touched before 3741.00. Here's the chart. _______ UPDATE (Jul 13, 9:52 p.m.): The trade was a quick winner of around $11,000, since ES head-faked to 3873 on meaningless CPI news before veering sharply south. In the chat room, I'd suggested taking a partial profit just before the lunatick leap on the news, but even then the futures were up 40 points above the 3805 'mechanical' entry point from a day earlier. I was unable to determine if, or how many, subscribers did the trade, so there was no tracking guidance, just a price target that worked precisely. _______ UPDATE (Jul

Rates on the Ten-Year Note have come down hard since getting within an inch of a 3.56% target flagged here a while back. There were two other targets in play going back to October 0f 2021:  3.46% and 3.24%. Odds were good that an important top would form in the narrow band between them. This is notwithstanding expectations even now that that Fed will continue to raise rates. My hunch, which is an extreme outlier in a world obsessed with inflation, is that rates are  already high enough to snuff inflation without any further tightening. However, last week's surge from 2.8% to 3.1%  reminds us that the so-far top is not chiseled in stone, especially since the selloff from the high did not exceed any significant prior lows.  For now we'll simply monitor the chart, which is hinting of a run-up to around 3.29%.

T-Bond prices fell last week not for reasons of weakness, but because the bonds got winded after pushing into heavy supply created by a last-ditch distribution over the last three weeks in May. The possibility of an important bottom in Treasurys is corroborated by interst rates on the Ten-Year Note's having reached a corresponding rally target at 3.56% when the bonds were cratering.  TLT looks like it needs a little more corrective action to base for a sustained rally, and my hunch is that it will occur closer to 110. A retest of the 108.12 low is also possible, but I would expect only a marginal breach at worst if one occurs.

Our favorite stock-market bellwether had a decent week, with a 6% rally sufficiently lacking in excitement to suggest the stock's handlers are quietly planning more of the same. The rally came on the heels of a successful 'mechanical' short from x=143.27 that I had recommended paper trading. The winning pullback did not so much suggest weakness as restfulness, and that's why we should expect the current uptrend to take out C=151.74, even if there's not much follow-through.  Indeed, it would be a shocker -- at least for me -- if this bear squeeze makes it to 166.48 peak that I've used as the point 'A' high shown in the chart. _______ UPDATE (Jul 13, 10:01 p.m.): Portfolio managers who have lived effortlessly off AAPL over the years are prepared to move heaven and earth to stop out shorts above C=151.74. They will have their work cut out for them, since iPhone sales have never faced a global downturn remotely as menacing as the one that has already begun.

A 29.92 downside target I'd drum-rolled, albeit with a dollop of sarcasm, turned out to have been just the ticket for subscribers who have been waiting patiently for a turn. Enough of you reported getting long using my number that I've established a 400-share (or multiple thereof) tracking position. Assuming 50% of the position was exited near 31.35 as advised, you are holding half of the original position with a profit-adjusted cost basis of 28.49. For now, stick to the 30.52 stop-loss  advised earlier. That's where selling would generate a bearish impulse leg on the lesser charts. Make the order o-c-o with another to exit an additional 25% of the position at 32.43. ______ UPDATE (Jul 12, 5:25 p.m.):  If you followed my guidance, you should have dismounted this glue horse at 30.52 for a theoretical gain of $206. We'll go back to ignoring GDXJ until such time as it shows better behavior.  Worst case is now D=25.35. yet one more place where we could back up the truck and hope to make money even if we're wrong about a bottom there.

August Gold finally turned higher on the final bar of the week, a suspicious development from which some in the chat room seemed inclined nonetheless to take encouragement. My take is more skeptical, given the way sellers cracked the midpoint Hidden Pivot support at 1794.90 a week earlier. It suggested that the futures are likely to reach 'D' before they can make a good-faith attempt to end the long dirge begun from $2000  in April. Please note the small adjustment in the chart -- a shift to a higher point 'A' that has lowered the target by a few dollars to 1707.20.  Note as well that a two-level rally to x=1888.70 would set up a 'mechanical' short of a kind that has worked well for us in the past. _____ UPDATE (Jul 12, 5:38 p.m.): Chat room remonstrations have sought equal time for predictions of a 1670 low before this cinder block can turn around, so here it is: a 1665.00 Hidden Pivot target. Certainly not impossible, but I will be looking for a tradeable and potentially important turn from higher levels nonetheless. Specifically, I expect the futures to bounce from 1718.30, and thence from 1707.20 if there's a relapse. If 1707.20 is exceeded on a closing basis for two consecutive days, however, or exceeded by more than $4 intraday, I would infer that 1670 is indeed going to be reached (and slightly exceeded).  That would be a great place to back up the truck and buy 'em hand-over-fist.

Last week's funeral procession turned p=19.59 from support to resistance, offering scant hope for a turnaround any time soon. It will come sooner or later, of course, since the futures have been falling hard for nearly three months. But the chart suggests the September contract must come down to at least p2=18.06 before bulls can come out of hiding. As always, a decisive move through p2 on first contact would suggest a feint toward D=16.53, if not necessarily a washout to it. Alternatively, a rally to x=21.12 (i.e., the green line)  might seem enticing, but it would in fact trigger a quite promising 'mechanical' short (stop 22.66).

Much as I've been hating Bertie lately, I'd have been eager to bottom-fish down near D=17,903 if this bitcoin proxy had come closer to it.  The Hidden Pivot target should have been achieved, given the way sellers stabbed p=25,223 on the way down a month ago. Instead, we saw an upturn from $700 above it. Ordinarily I would infer this is more bullish than a reversal from the target itself. In this case, however, I have assumed buyers jumped the gun only because of the obviousness of the pattern and its target. That doesn't mean a real rally could not begin with brazen front-running as has occurred here, but it does suggest that the overweening eagerness of the players could become a negative as profit-taking enroute to the round number $25,000 grows intense.

How high is the bear rally begun in mid-June likely to go before buyers run out of gas? The 4029.75 target shown in the chart is a logical answer, even if the hubris of billboarding it here could queer its voodoo magic. A run-up to 4029 would represent a 3.1% gain over Friday's close and a 10.7% move off the June 17 low. Since January, when the bear first showed its fangs after hibernating since 2009, rallies have been relatively subdued, implying shorts have yet to be spooked into covering. Perhaps it's because the outlook for the U.S. and global economies is so dark that there are few good reasons to be discovered for buying shares. Not that buyers have ever needed reasons, let alone good ones. But even bad ones lack persuasiveness these days, what with the 'experts' debating how much recession we're likely to get. Triggering off short-covering stampedes will always be a primary concern of the stock market's institutional sponsors. That's because short-covering is the only source of buying powerful enough to push the broad average past previous peaks. It also has the miraculous ability to make investors temporarily forget about the wall of worry no matter how mountainous. The effect can produce spasms of mass insanity so overwhelming that even now, with the U.S. economy about to tank, a stock market rally to new all-time highs is not inconceivable. Post-Blowoff Behavior It  is extremely unlikely, however, given that residential real estate has completed a blowoff top; the auto sector is being suffocated by high prices and material shortages; and consumer credit growth has turned down as interest rates rise across the yield curve. Under the circumstances, even if a punitive bear squeeze is overdue, investors shouldn't get their hopes too high that it'll come before stocks