Feb Crude came down hard after peaking last week 30 cents above a level where I'd suggested looking for a set-up to get short. There was no discussion of this in the chat room, so I have not established a tracking position. The nasty tumble is good news for motorists, since it implies that $3 gas will be with us for at least a little while longer, Here in Florida, and elsewhere in the U.S. (although surely not in California), there is a chance that the price of premium gas will fall below $3. Depending on how sellers handle the 70.34 midpoint support, the weakness could continue down to as low as D=64.49.
In these way-too-interesting times, there aren't many publications that would trumpet a New Year's Eve headline like the one above. It topped the front page of the South Florida Sun Sentinel, however, a tribute to the Sunshine State's winning performance on the playing field. Two college basketball teams, University of Miami and Florida American University, made it to the NCAA Final Four, while the Panthers and the Miami Heat did much better than expected in, respectively, professional hockey and professional basketball. Many investors, too, will be hoping for a repeat of 2023. The S&Ps tacked on nearly 1,000 points since the start of the year, and that is bound to have raised their expectations for more of the same in 2024. My own forecast suggests they may be in for disappointment. Although I see the broad averages going at least somewhat higher, a moonshot looks doubtful. That's because shares of Microsoft, currently trading for around $375, look incapable of exceeding a granite 'Hidden Pivot' ceiling at $430 without experiencing a major correction or a bear market first. MSFT has taken AAPL's place as my #1 stock-market bellwether because iPhone sales will be extremely vulnerable in a recession, even as subscription revenues for Microsoft Windows/Outlook continue to roll in no matter what happens to the global economy. MSFT is therefore the single most important stock in the world, and when its long roll of the dice sevens out, that will signal the end of the stock market's near-vertical climb. Bullion Gathering Strength If there is great news coming for investors, look for it to happen in the bullion sector. Silver and gold have spent more than three years consolidating for a push that will turn $2000 into bedrock support for the latter. The move has been such a long time in
The stock has been on a short signal since it fell $4 to 195.57 to a week ago. There is implied minimum downside to p=191.52 for this presumptive correction, but a decisive breach of this Hidden Pivot support would portend more slippage to at least p2=187.46 or even to D=183.41. Since the broad averages will follow the stock whichever way it goes, we'll monitor price action at HP levels closely. AAPL has returned to normalcy, more than keeping pace with MSFT in the face of news that would rattle buyers were they not predominantly heedless psychotics and buy-and-hold chimps who purport to 'manage' portfolios.
Dollar bulls ceded more ground last week, further thwarting Powell's efforts to raise the cost of dollars so that they are no longer effectively free to speculators and money-changers. DXY's moderate slippage left it somewhat shy of wrecking an incipiently bullish pattern via a dip beneath the point 'C' low; however, the direction and rate of decline were hardly encouraging. The dollar remains on a 'mechanical' buy signal in theory, but the strategy no longer looks likely to produce a winner. If the plunge takes out C=99.59, we should brace for more slippage into the mid 90s.
Not sure why the rally couldn't go the extra millimeter to achieve the 2086.40 rally target I'd set as a minimum target last week. To ease the burden on intermittently enfeebled buyers, I've lowered the bar slightly by shifting to a slightly higher 'A', a pretty little one-off low that I might have used initially. The correspondingly low p at 2084.60 hasn't changed the fact that bulls will need to blow past it to become a good bet to reach D=2181.20. In the meantime, don't pass up an opportunity to buy a swoon to x=2036.20, provided you know how to set up a 'camo' trigger to reduce the theoretical entry risk of nearly $20,000 on four contracts.
I've synched up Silver's chart with Gold's to show that the former is slightly outperforming the latter, leading the way, as it were. Last week's penetration of the midpoint Hidden Pivot at 24.70 was not sufficiently impressive to make further progress to D=26.62 a surefire bet, but at least it's a start. Similarly to gold, a pullback to the green line at 23,744, especially early in the week, would signal an attractive 'mechanical' buy. We may be able to improvise on-the-fly, however, if there is not enough weakness to bring the futures down to our niggardly bid.
Bulls did what we asked of them last week, exceeding July's 39.70 peak on a squeeze-powered rally that ended the week. They had given up a lot of ground by day's end, but that won't diminish the authority of the impulse leg the rally created on the daily chart, and neither will the fact that the prior peak was exceeded by just 12 cents. It's all good, as they say, and we can therefore expect this vehicle to continue up to a minimum 41.81. In the meantime, any one-level pullback from 40.09 or higher would set up an opportune 'mechanical' buy, even at the red line (where a 37.22 stop-loss would obtain).
Last week's rally, which occurred almost entirely with a leap on Monday, brought the futures to within easy distance of testing my recommendation to short the green line (x=75.88) 'mechanically'. The textbook stop-loss would be just above the 'C' high at 79.57, implying nearly $15,000 of entry risk on four contracts. I will try to provide real-time guidance for this if there is strong interest in the chat room, but in any case we should be able to determine with a high degree of confidence whether the mini-bear market begun in late September from around 88 is over.
It may seem churlish for me to point this out, but the apex of last week's rally did not quite achieve the 4836.50 target shown in the chart. It fell 5.75 points shy -- enough in the context of so subtly perfect a pattern to temporarily cast doubt on the bullish enterprise, such as it is. A fist-pump through the target on Tuesday or Wednesday would put bulls back on track with more short-covering, the sustaining force behind a run-up begun in October that long ago exceeded the threshold of sanity. Assuming stocks head lower when trading resumes after Christmas, expect the March contract to fall to at least 4778.50, and thence to 4735.25 if any lower. You can bottom-fish at the latter number provided you know how to chisel the risk down to relative pocket change with a 'camouflage' trigger. The numbers are, respectively, the p and Hidden Pivots of the small reverse pattern shown here. It worked nicely on Friday, producing a gain of as much as $5,000 on four contracts for any subscriber who shorted at 4811.50 on the way down as I explicitly advised in the chat room.
[The following was written by my good friend James Trabulse. A devout Catholic, Jim regularly attends a Latin mass. He is also a gifted trader who brings rigorous science and outside-the-box thinking to nearly everything he does, including playing golf, staying healthy, cooking savory, nutritious meals and training Olympic-caliber athletes. RA ] Merry Christmas, and may the Lord's blessings be on your house. When we first said 'Merry Christmas!' in A.D. Zero, the baby slumbered in an animal-feeder in Bethlehem, 90 miles south of Nazareth -- hardly a pleasant affair, with no one there save Mary and Joseph. As we sing in the Roman Rite at the Intrit: Puer natus est pro nobis, is this the fulfillment of Isiah when he prophesied: For a child has been born to us, a son given to us, and the authority is upon his shoulder, and the wondrous adviser, the mighty God, the everlasting Father, called his name, 'the prince of peace.' We said 'Merry Christmas!', to the derision of the Romans for 254 years. They outlawed us, put us in with hungry lions in the great Colosseum, along with a cheering crowd and Caesar’s thumbs turned down. Taming the Visigoths And when we said 'Merry Christmas!' to bring the good news to the Goths and Visigoths, they burned us and ran us through. Five-hundred years later, they were saying 'Merry Christmas!' in German, one of their own being Saint Nicolas! And 'Merry Christmas!' in Tunis and Algiers was met with the Star and Crescent and beheadings; but we said 'Merry Christmas! The Child of eternal hope is here!' And then, 'Merry Christmas!' in Ye Olde England under the Puritans was met with hangings, exile and nothing merry at all; but we continued the greeting long after Elizabeth and Cromwell were dead and
