The bull trend begun in February has gone comatose along with the stock market. The timing of the breakout is unpredictable, but look for the futures to ascend quickly to p=1993.20 when it happens. The futures could continue to swing gratuitously $40 either way in the meantime, but any trading opportunities thereof would need to come from the lesser intraday charts.
The pattern shown is so wickedly gnarly that I'm surprised last week's low did not occur within pennies of the 93.07 target. I would be logical to infer that a bottom is in and that the futures are telegraphing strength in the week ahead, and so we shall. But I will also suggest keeping an open mind to the possibility of a relapse to the target, since that would enable us to bottom-fish with risk under very tight control. ______ UPDATE (Apr 11, 9:04 a.m.): Now that's more like it. The futures did in fact relapse to a 92.93 low just a millimeter below my target. This allowed traders to get long in numerous ways that could have been worth anywhere from around $600 to $2000 so far. This chart shows how you could have set up a conventional 'camouflage' trigger at the green line, x=93.73. ______ UPDATE (Apr 13, 10:50 p.m.): Just a smidgen to go before we can gauge the fledging uptrend's strength as it interacts with p=105.03. As always, an easy penetration would portend more upside to D=117.01. Here's the chart.
I seldom rate 'mechanical' trades '8.0' or higher, but the one shown in the chart is right up there. It is so juicy, actually, that we should probably assume Bertie's taskmasters are not planning to gift us with such a bargain-basement opportunity. Interest in this vehicle has been almost nil, so I'll leave it to you guys to figure out the optimal coordinates to use for getting long somewhere above x=40,023 with a tight 'reverse' pattern. Unless this vehicle shocks by plunging below C=32,977, the somewhat-big-picture rally target will remain 61,163. _______ UPDATE (Apr 11, 6:10 p.m. EDT): A vicious but wholly gratuitous $7,000 plunge has triggered the 'mechanical' buy in Bertie noted above. Keep in mind that the green line (i.e., x=40.023) is NOT a support, nor even necessarily a place to get long. That is best accomplished using camouflage. Here's a pattern you can use for that purpose. You'll have the wind at your back with any entry method employed near D=39,166 of the pattern shown, but ask me first if you are too scared to pull the trigger. That is the way you're supposed to feel when good mechanical opportunities arise. _____ UPDATE (Apr 12, 4:45 p.m.): The rally and the opportunity have come and gone, leaving a $7000 hump on the hourly chart to discourage both bulls and bears with a demonstration of how silliness often rules the markets.
[Counting on the Fed to ride to the rescue when the bubble finally pops? You had better have a Plan B, and for good measure a Plan C, since America could be in for something far worse than mere recession when the asset boom ends. In the commentary below, my friend Charles Hugh-Smith spells out the reasons this is likely with greater clarity and concision than I have. I am grateful for his permission to reprint the essay, an installment of the 'Musings' emails that go out to subscribers every Saturday. Discover his extraordinary blog, books and deeply original reflections at OfTwoMinds.com by clicking here. RA ] **** By Charles Hugh Smith The saying "demographics is destiny" encapsulates the reality than demographics--rising or falling trends of births and deaths--boost or constrain economies and societies regardless of other conditions. Demographics are long-term trends, but the trends can change relatively rapidly, with momentous future consequences. As this article below mentions, extrapolating the high birth rates and falling death rates of the 1960s led to predictions of global famine. As death rates declined and women's educational and economics prospects brightened, birth rates fell, a trend that now encompasses most of the world. As a result of the Green Revolution (hybrid seeds and hydrocarbon-based fertilizers), the Earth supports more than twice as many humans as were alive in the 1960s (3.5 billion then, 7.9 billion now). Now the problem is a shrinking working-age population that will be unable to support the financial and healthcare promises made to the retired generations. Birth rates in developed nations have fallen below replacement rates, which means populations are shrinking and populations are aging rapidly, i.e. the average age of the populace is rising.. One side effect discussed in this article is the decline of the cohort of young
Ordinarily I would infer weakness from the futures' failure last week to reach the 4645.25 rally target drum-rolled here earlier. In this case, however, I'm inclined to think that enough traders and algos are starting to catch on to 'our' reverse patterns that instances as obvious as this one are going to get front-run. Even more compelling for the bullish case is that in this vehicle and our bellwether of bellwethers, AAPL, the selloff has followed an upthrust that exceeded an important prior peak, generating a robust impulse leg on their respective daily charts. We can test this bullish theory as the new week begins using this pattern, a corrective abc that in theory should yield a decent 'mechanical' short at x=4534. If bulls are still in charge, look for it to get stopped out within a day or two. _____ UPDATE (Apr 4, 10:01 p.m.): It took only a few hours for the unrecommended trade to get stopped out, so bulls are still in charge. _______ UPDATE (Apr 5, 6:04 p.m.): Bulls turned comatose, activating this minor, bearish pattern, An overshoot of D=4475.75 would imply sellers are not yet done. Also, a rally straightaway to x=4560.50 would trigger a 'mechanical' short, subject to the usual 'camo' risk controls. ______ UPDATE (Apr 6, 11:25 p.m.): The futures fell to the 4475 target overnight, then spent the entire day diddling it as though nothing were happening in the news. In the end there was no bounce, however, so bears will have the edge when Thursday's session begins. The pattern shown in this chart should be helpful in nailing the swings on the way down to as low as D=4146.75. And yes, p=4388.88 can be bottom-fished with the tightest 'camo' set-up you can construct. If it gets pulped, expect selling to gain momentum.
The stock closed above a key midpoint pivot for the second consecutive week, significantly shortening the odds that the 194.77 rally target will be achieved. It also set up a potentially appealing 'mechanical' buy if AAPL should surprise with a seeming kamikaze dive to the green line, x=161.27. We'll find a way to cut the implied $4500 entry risk if and when the time comes, but for now let's focus on the lesser charts for set-ups that can put us onboard with risk held to a practical minimum. _______ UPDATE (Apr 4, 10:08 p.m.): Buyers have blown past p and D, implying there is every likelihood the stock will hit D=185.56. The 194.77 target of a larger pattern given above remains valid as well. ______ UPDATE Apr 6, 11:35 p.m.): DaBoyz may let AAPL fall to as low as 158.97 before they pounce on it again. That would set up a no-brainer 'mechanical' buy, although we might attempt it with somewhat more risk at the red line, p=167.83, stop 161.92. Here's the chart. Stay tuned to the chat room and switch on your 'Notifications' if you care.
The rally has blown past every Hidden Pivot resistance that might have stopped it, suggesting it has a ways to go. Specifically, the move could reach the 3.22% target shown in this chart. The pattern used to project the target is highly unconventional but legitimate nonetheless, since the point 'B' high surpassed some very real 'external' peaks from 2019. If the foregoing is correct, the economy is in for quite a bit of pain before a collapse and a bear market snuff inflation for a generation. The stall at p=2.45% could conceivably be the end of the move, but the breach is already significant enough to presume otherwise. _______ UPDATE (Apr 5, 6:19 p.m.): The rally ripped though p=2.45% today with such force that we can infer that p2=2.83% of the chart linked above will likely be achieved. It is tied to the 3.22% target. [Apr 6 note: My apologies. WordPress failed to publish an update and chart Tuesday night that were intended to take the guesswork out of this rally. Here's the chart, which shows the provenance of the 3.22% target, now an odds-on bet to be reached eventually.]
Gold has sold off hard after peaking three weeks ago at $2082, about 1.8% beneath the all-time high at $2122 recorded in August 2020. Because the pullback has come from the pattern's sweet spot above p=2022, we should be prepared to buy the June futures 'mechanically' if they pull back to the green line. There's nearly $16,000 per contract of theoretical entry risk, so we will naturally be looking to 'camo' our way aboard in order to cut that down to more like $600-$800. Stay tuned to the chat room and keep your account 'Notifications' switched on if you're keen to play.
The chart shown in the inset employs the same coordinates I've used in June Gold to produce a picture not quite as bullish but still promising. Gold has already poked above its red-line 'midpoint' Hidden Pivot, but silver has merely exceeded the green line (x) to signal a rally to at least p=30.76 theoretically. The thing to realize. however, is that the stab higher three weeks ago surpassed an 'external' peak, generating an impulse leg of weekly-chart degree that will not be easily reversed. That would require a drop below C=21.41 of the pattern -- possible but seemingly unlikely at this point. _______ UPDATE (Apr 11, 8:30 a.m. EDT): May Silver has finally launched toward the 25.83 midpoint pivot of the pattern shown here. It will serve as a minimum upside projection for the next day or two. As always, an easy move through this 'hidden' resistance would portend more upside to the next Hidden Pivot level, in this case the 'secondary' pivot at 26.73. ______ UPDATE (Apr 12, 4:52 p.m.): The rally topped out a penny above the 25.83 Hidden Pivot we were using as a minimum upside projection. No one mentioned this in the chat room, of course, but I lack the energy to admonish or cheerlead. Score it as yet one more tree that fell silently in the forest.
The rally is almost certainly corrective and would trigger an enticing 'mechanical short even if it were to soar to the green line (x=145.26). More likely is that the downtrend will resume well before then and fall to at least p2=125.83, the minimum downside target we've been using for the last several weeks. Further weakness to D=116.06 is unpredictable as yet, since the initial encounter with midpoint support at 135.59 on the way did not feature its impalement. _______ UPDATE (Apr 6. 11:53 p.m.): This week's mini-crash has brought TLT down to within four-tenths of a percentage point of the 125.83 Hidden Pivot we've been using as a minimum downside target. If this number fails to produce a strong bounce, that will shorten the odds of further slippage to D=116.06.
