Rick Ackerman

There were few headlines out of the Middle East over the weekend, mainly because only Israel and Iran are capable of judging the damage, and neither is saying much. Wall Street, on the other hand, seems quite confident that whatever is happening, and irrespective of the outcome, it will be quite bullish for stocks. As much was evident on Friday, when the lunatic sector (aka 'the Magnificent Seven') bounced back from heavy losses early in the session, then spent the remainder of the day building a plateau from which stocks can launch anew when the all-clear signal comes. This would be appallingly reckless behavior, but we have become used to it as the stock market has increasingly decoupled from geopolitical and even economic reality over the last decade or so. It's possible investors are simply envisioning a brighter tomorrow, with Iran no longer able to export terror to the world. China and North Korea will continue to threaten, of course. But their ability to spread malice and death will be significantly impaired once Israel has cut off the arms and legs of their Iranian proxies. Jihadism will still be with us, and active to the extent its chief sponsor, Qatar, has plenty of crude oil to sell. But perhaps with the inspiration of nuclear terror in remission for a few years, and an entire generation of jihadi leaders rubbed out by Israel, the world might enjoy a period of relative peacefulness. How odd would that be?  [Check out my latest interview on This Week in Money. It delves into the mania that has seized investors in stock and real estate assets.]

The futures ended last week's sprightly death dance poised to move higher as soon as Wall Street gives the all-clear for nervous Nellies worried about the war between Israel and Iran. Although the September contract hasn't signaled a certain move to the 6358.00 rally target, it has shown enough buoyancy to make a pullback to the green line (x=5948.00) an enticing buy with a 5811.00 stop-loss. Use a 'camo' trigger to cut that down to size so that theoretical entry risk is no more than $175 per contract.

Headline news from the Middle East loosened DaBoyz' deadly grip on shorts as the week ended, but it did not disturb my expectation of a potentially juicy short at exactly 486.17. That Hidden Pivot target was first signaled five weeks ago, and it has kept us from turning too bearish on the stock market despite an apparent dearth of buying interest in the broad averages. I cannot say exactly when MSFT will hit the target, but when it gets within a few pennies of it we should be ready to jump on some options, either naked shorting soon-to-expire calls or buying some cheapie, expiring puts. Stay tuned to the chat room for timely guidance. Also keep in mind that a major top in this stock will end the bull market begun in 2009, and that this could be it.

Bulls finally broke through a crucial midpoint Hidden Pivot resistance at 3423.20 after weeks of pumping and priming, clearing the way for more upside to at least p2=3559.20, the pattern's secondary pivot. As always, its decisive breach would portend a likely finishing stroke to D=3695.30. We are unlikely to see a swoon back to the green line (x=3281.10), but if this should occur, plan on bottom-fishing there 'mechanically' with a 3151.00 stop-loss. More immediately, if the future haven't exceeded 3467.00, you can try bottom-fishing around 3356.80. That number could be expected to work exactly but for the fact that it coincides with a previous low at 3358.50 recorded on June 12 that is going to attract too many eyeballs. _______ UPDATE (Jun 16, 2:59 p.m. EDT): With Wall Street celebrating “risk-off” like there will be a million bright tomorrows, bullion is getting hit especially hard. Just remember, the selling is being orchestrated by agents who are eager to buy the stuff. I expect the fake carnage to continue down to 3361.70 [modified] before the futures turn around. August Gold is currently trading around 3407.90. _______ UPDATE (Jun 19, 9:12 a.m. EDT):  My revised correction target for August Gold (see above) came within $2.10 of nailing the v-shaped low of a so-far $33 rally. It's too early to tell whether this will mark an important bottom, but if you got aboard near the low, you should be out of a third to half of the position with a partial profit of as much as $3,000 per contract. Assuming the bounce continues, the closest target is 3419.00. Here's a graph that shows it all. _______ UPDATE (Jun 20, 1:22 a.m. EDT):  The futures have relapsed after rallying sharply from within an inch of my 3361.70 correction target (see above). I recommend playing for

We can breathe easier when July Silver touches the pink line (p2=37.291) since that would make any one-level pullback a correction that we could buy 'mechanically'. It would also shorten the odds of further progress toward a 40.439 target that I've assured you will be achieved. In the meantime, the futures are in limbo, looking for a favorable gust to help things along. If July Gold achieves a comparable target at 3695 at the same time, the gold:silver ratio would stand at around 91, down significantly from recent highs above 100.

Although Bitcoin is considered one of the most volatile and challenging vehicles to trade, it is actually the unwitting bitch of Hidden Pivots, tracing out swings as predictable as rush-hour pileups on the San Diego Freeway.  I have demonstrated this repeatedly with trend and target calls that have been correct at least 85% of the time. (If you have observed otherwise, by all means leave a comment.)  Last week, I recommended shorting aggressively into a nasty short squeeze that pushed Bitcoin more than $10,000 higher in three days. The countertrend trade produced a gain of $3596 a couple of days later for anyone who followed my simple instruction. Will Bitcoin now come down to 97,616 as further predicted?  We'll see. If it does, plan on bottom-fishing there with a stop-loss as tight as 0.2%, or $225. Good luck!

I've identified bearish targets well below these levels at, respectively, 81.64 and 77.49, but I'm giving every countertrend blip the benefit of the doubt so that I am not caught unawares if an important turn comes. This blip was Thursday's gap-up rally above two prior peaks on the daily chart, one of them 'external'.  That generated a bullish impulse leg, implying Friday's mild sell-off was merely corrective. (The weakness also failed to reach a downside 'd' target, which adds to the short-term-bullish picture.) Let's see what the new week brings. If TLT can push above the 88.21 'external' peak recorded on May 7, that would be worthy of serious attention. ______ UPDATE (Jun 20): A tedious, disappointing week, although by no means cause for despair. TLT still needs to fist-pump above the 88.21 peak from May 7 to command our respect.

Last night's explosive move through the 70.82 midpoint Hidden Pivot of the pattern shown has removed any doubt its 86.51 target will be reached.  It seems improbable that there should be a lid on an energy market that is now on wartime footing, but that's what the chart implies. However, if the move even slightly exceeds the target, and thence early April's slightly higher 'external' peak at 87.63, a lurch toward the magnetic $100 mark would probably become inevitable. In any event, your trading bias should be aggressively bullish until such time as 86.51 is reached.

I've used the June chart to allow a little more running room for the finale of this now two-month-old bear rally. The new target lies at 6132.75, about 82 points above the one given here previously. Although I am fairly confident the Hidden Pivot resistance will work, I'm prepared nonetheless for a Mother of All Tops to occur marginally above last December's record-high 6235.  I don't usually dig in my heels where mere feelings are involved, but I've had it up to here with bullish hubris and the idiotic notion that stocks somehow deserve to be trading at these levels. We are literally at a civilizational height of folly, and the usual shenanigans will not suffice to push this vehicle through formidable layers of supply that accumulated between last October and March. It may be working for Microsoft, but that is why I expressed doubts earlier that the broad averages would follow.