The sharp reversal from $100 last week was so predictable that it's hard to take it seriously. Everyone has known that $100 is a psychologically crucial price, implying there is absolutely no way it will cap crude's world-shaking ascent. Enjoy the correction while it lasts, since the new highs that are eventually coming will push gas prices above $6 in California and other places where fuel pretends to be scarce. The 107.63 target given here earlier still obtains, and only a drop below the 87.46 'external' low recorded on 2/18 would hint that it is not necessarily a done deal. _______ UPDATE (Mar 1, 9:10 a.m. EST): I can't account for having overlooked the very major, 101.88 rally target shown in this chart, but here it is. A place for caution, to be sure, and to squeeze off a tightly stopped short if you know how. ______ UPDATE (Mar 2, 12:17 a.m.): Shorts will have gotten their faces ripped off by today's spectacular bear squeeze, but their pain is the least of civilization's worries. When energy used to power nearly everything on the planet is repriced to take today's massive surge into account, it will turn that which lubricates global economic movement into something like glue. Under the circumstances, the Dow showed chutzpah to have fallen a mere 500 points. Consider it an odd kind of distribution --the best the sleazeballs who manipulate markets professionally could do. But don't expect the relative softness in selling to last much longer once investors get the message. The same bozos have also underreacted to the breathtaking rally in T-Bonds, but it, too, is about to overtake them with dread. _______ UPDATE (Mar 2, 8:44 a.m.): Speaking of bozos, here's a chart I prepared last night that, if I'd remembered to include it with the update,
A pretty good session, our hour together featured a ‘forced’ trade in gold futures that made a theoretical profit of several hundred dollars in just a few minutes. The set-up was framed within an rABC pattern, but the trigger used ‘mechanical’ levels so that we could initiate with a limit bid. We also pondered rABC logic in the context of several popular symbols, including Chipotle, Beyond Meat and the E-Mini S&Ps.
Hidden Pivot voodoo nailed El Diablo's most diabolical swings last week almost to-the-tick, allowing subscribers who were tuned to this vehicle to crush it on trades from either side of the market. The week ended with a key support at p=4324.25 holding precisely, so any predictions about what, exactly, will come next would be premature. As always, a decisive breach of p would portend more downside to the 'D' target -- in this case 4062.50, the number we've been using to avoid getting suckered by bear rallies. Meanwhile, we should not fear the inevitable short squeeze unless it pushes this hoax above the 4512.75 'external' peak recorded on February 12. ______ UPDATE (Feb 23, 6:06 p.m.): Even the village idiot could see that all rallies are short sales these days and that they are occurring mostly in the dead of night. This is when the Master of the Universe (a.k.a., DaBoyz) are most easily able to manipulate stocks higher for distribution on extremely thin, short-squeezed volume. Bears should be careful as the selloff approaches the 4190 'secondary' pivot of the large, bearish pattern that projects to 4062.50. Here's another view: the presumably fragile neckline of a big head-and-shoulders formation. _______ UPDATE (Feb 24, 11:17 p.m. ): A dead-cat trampoline bounce rocketed off a low 40 points from D=4062.50. The low occurred about midway between p2 and D, a 'discomfort zone' that is too unreliable to leverage. A run-up to the green line would trigger a 'mechanical' short, but only a one-level ride should be attempted; any more would be greedy. Here's the chart.
Perhaps the new week will bring more clarity to a graphical picture of AAPL that is beginning to turn a little murky? The only thing keeping me somewhat bullish at the moment is the incipient reverse-head-and-shoulders shown in the chart. It is a seven-month fetus at this point, however, and only further gestation will reveal how well-formed and healthy the baby is likely to be. A big move down would probably render the pattern stillborn, but it would only benefit bullishly from a big rally. _______ UPDATE (Feb 23, 5:17 p.m.): The playful little jig that AAPL just did on its midpoint-pivot gravesite suggests it is on its way down to exactly 148.93, the 'D' target of the pattern shown here. First, let's root for a punitive fall to at least p2=155.86. _______ UPDATE (Feb 24, 11:28 p.m.): AAPL's canny handlers impaled shorts with a spectacular bear rally. Like the bounce in the E-Mini S&Ps, this one began about midway between p2 and D, a 'discomfort zone' spot too tricky too rely on. The bounce occurred from where it did because nearly every trader on earth was waiting to buy at the D target of an all-too-obvious pattern.
The April contract is closing on a 1916.40 rally target that has been coming since August, albeit not without far more sturm und drang than gold bugs might have preferred. This is a bull market patiently waiting for a change in the very big picture to make its move. Although the nature of the change is impossible to predict, we can surmise that it will be concurrent with a fraught morning on which portfolio managers awaken with the kind of dread they haven't felt since 2008. In the meantime, we'll closely monitor price action when 'D' is hit, since an easy move past it would imply that bullion may at long last be heating up. ______ UPDATE (Feb 23, 5:30 p.m.); The so-far shallow correction after the futures kissed the 1916.40 target earlier this week suggests they're fixing to go higher. If so, look for the move to be effortless until around 1950, where 'discomfort zone' jeopardy will be at maximum force. It's a scalp-short for those who know how, but that wouldn't diminish the likelihood of a subsequent run-up to 1977.60, where the April contract made an important peak early this year. Here's a fresh chart. _______UPDATE (Feb 24, 9:52 a.m.): Oh my, such a shocking surprise! April Gold ran up to within a split hair of the 1977.60 resistance noted above, then sold off by a whopping $40. We will be in wait-and-see mode for a while, with high-confidence trade set-ups possible only on the lesser charts.
Silver lags gold within the bullish framework of price action since mid-December. The 26.13 target of the pattern shown remains viable nonetheless and is no less likely to be achieved than it was last December, when the bull trade was first signaled. The pattern has produced one excellent 'mechanical' buy at 22.59 that would have yielded a profit of as much as $22,000 on four contracts, and it would likely produce another of the March contract were to revisit x=21.59. alternatively, if the futures continue higher, a pullback from p2 to p could be bought 'mechanically' with a textbook stop at 22.98. That implies about $16,000 of risk, so this gambit is for 'camouflageurs' only. _______ UPDATE (Feb 23, 11:36 p.m.): The very steep dive from a peak 50 cents below D=26.12 did not negate the target. If you are trading this vehicle 'mechanically,' I'd suggest waiting for a play at the green line instead of at the always-riskier red line. Here's the chart.
Bertie is working on a promising bullish impulse leg, but not outperforming the market as it used to do so effortlessly. The chart I've linked is ostensibly bullish, inferring as it does a massive head-and-shoulders pattern that looks like it will be hard to disrupt. Regardless, this vehicle is just a trade at the moment, so you'll need to nudge me in the chat room if you see any opportunities you'd like vetted. Notice that sellers could push down to as low as 29,000 without much affecting the constructive look of the big picture.
TLT has bounced from a place that is obvious only to us -- the swaddling bosom, as it were, of a visually defined 'discomfort zone'. That means the rally has been endowed with enough mystery and surprise to juice it pretty good. Will bulls seize the advantage ? Rather than try to predict, we'll simply keep an eye on it and trade TLT with a bullish bias. Bring your timely ideas to the chat room if you're interested and I will gladly vet and score them using Morning Line odds. _______ UPDATE (Mar 2, 12:10 a.m.): The rally looks certain to hit a minimum D=145.13, given the way buyers obliterated midpoint resistance today at p=139.82. Here's the chart. ______ UPDATE (Mar 2, 8:05): The worst selloff in recent memory triggered a 'mechanical' buy at x=137.19, stop 134.50. No one mentioned this opportunity, but I'll track it as a paper-trade nonetheless. We're looking to exit at least half at p=139.82. _______ UPDATE (Mar 3, 10:52 p.m.): Once again, a 'mechanical' trade has caught the low of a scary dive to produce a quick and relatively painless winner. T-Bonds' sharp reversal this evening has pushed TLT up to the 139.82 midpoint pivot where I'd advised selling half. If you used expiring, near-the-money calls, they should have more than tripled in value. Selling TLT against the calls tonight would hedge the profit with a backspread. Here's the chart, with the elongated green bar representing night-session price action.
[The markets will be closed on Monday for President's Day, but I am putting out fresh touts and commentary because DaBoyz are required to briefly let the beast out of its cage on Sunday evening. Up-to-the-minute updates from Rick's Picks will resume on the home page and in the trading rooms on Tuesday. RA ] Technicians use charts to get a precise handle on trends and price reversals. However, even the unschooled eye can sometimes form a tradeable opinion by merely glancing at a chart. Does the one displayed above tell you anything that might be actionable? To my eye, and without resorting to any of the proprietary tricks that are possible with the Hidden Pivot Method, I see the Dow Industrials rolling over due to the presumptive weight of heavy supply. There are many reasons we could adduce for this; however, pondering 'reasons' would negate the value and usefulness of technical analysis, which shuns 'reasons' as mere noise in order to focus on how an infinitely complex conflation of 'reasons' are actually perceived and acted on by traders and investors. The chart above does not make it possible to infer with confidence that a full-blown bear market is about to unfold. But there is still the visually intuitive sense that: 1) a major rally from these levels is unlikely; and, 2) a large drop is needed to form a base before spectacular new highs could conceivably be achieved. Again, using only the eyes rather than the brain, how far do you think the decline would have to go in order for a base to form? There is no correct answer, but my subjective eye 'needs' a selloff into the void between the pink and red lines. Respectively, the levels are a 'secondary' Hidden Pivot at 31,036 and a Hidden
For now, allow for minimum downside to the 165.41 midpoint 'hidden' support of this pattern. Because of the mild gnarliness of this picture and the deep-sea location of p, you can try bottom-fishing there with a very tight stop-loss, even using out-of-the-money call options to leverage the bounce. Be sure to cash out half if they double in price! The chart shown in the inset yields a different and more troubling picture. The stochastic divergence shown is quite bearish, even if it is not yet ominous. I will continue to monitor it, since AAPL remains The Only Stock That Matters. ______ UPDATE (Feb 14, 2022): AAPL's unwillingness to fall is what kept the stock market from continuing Friday's refreshing slide. The Hidden Pivot at 165.41 could still get schmeissed, but that didn't seem likely at the bell. _______ UPDATE (Feb 15, 11:04 p.m.): Even if the pattern shown in this chart doesn't develop into a textbook head-and-shoulders, the look of it at the moment is bullish. To give bears the benefit of the doubt, however, we should hold the applause until such time as buyers push above the key peak at 177.18 recorded on January 12. _______ UPDATE (Feb 17, 6:07 p.m.): Weakness over the last several days has started to bend the head-and-shoulders pattern out of symmetry, somewhat diminishing its bullishness..
