Microsoft spent the last two days of the week churning a weak 'mechanical' buy signal. It is considered weak because the pullback to the green line where we typically do our buying followed a high along c-d that barely reached the midpoint Hidden Pivot, let alone the 'sweet spot' midway between p and p2. How the stock treats the signal has consequences for the broad averages, since the company trades with a value of around $3.6 trillion. If MSFT dips below c=464.89 without punching through p, that would add to the evidence that stocks are in a bear market. _______ UPDATE (December 14): Traders and the, um, 'investment community' spent the week screwing the pooch, so nothing has changed in the analysis above. _______ UPDATE (Dec 20): Another week of merciless pooch-screwing left MSFT undeserving of our attention. There is little to see or predict here, folks, so let's move along to the next exhibit
Last week's tedious scuddle left the futures on-track for a run-up to at least 4347.30 over the near-term. This Hidden Pivot resistance is just a weigh station en route to the 4529.80 target of a much larger pattern given here earlier. The D target of that pattern is 5126.10, the first I've identified above $5k. I expect potentially tradable resistance at 4347.30, but if buyers punch through it easily, that would shorten the odds of an eventual move to the higher targets given above.
Although Silver broke out around mid-morning on Friday, it spent the remainder of the session idling in a shallow pullback. This behavior reflects the preference of strong, confident buyers who could use a little rest. The quiet end to the week was deceptive, since it featured a decisive push through a 58.45 midpoint Hidden Pivot associated with a 'D' target at 70.81. (Please note that this number was incorrectly given here last week for the January contract as 63.39). A pullback to the green line (x=52.27), however unlikely, would be a screaming 'mechanical' buy. Here's a chart showing the futures' crucial progress last week.
Although Bitcoin ended the week in a mild selloff, it occurred in the context of a bullish cycle begun two weeks ago from 80,526. The correction would need to hit d=84,819 to set up an attractive buy, and a run-up in the meantime to x=91,840 would trigger a 'mechanical' short. This would be a one-level trade with p=89,500 as the profit goal, although that doesn't rule out additional downside to p2=87,160, or even to d=84,819 over the very near term. _______ UPDATE (Dec 8, 12:12 p.m.): The short sale detailed above worked out nicely and could have been covered this morning for an overnight profit of around $2,300. As expected, Sunday's rally was short-lived and exceeded the green line by just 0.4% before receding to within a hair of p=89,500. The recommendation was explicitly detailed and, presumably, clear enough for any subscriber to have done the trade. Any reports?
Bears dove for cover last week after a three-day short squeeze left them with the dim prospect of trying to obstruct a missile bound for new record highs. The 6907.50 target shown was a lock by Tuesday afternoon, when the futures not only punctured the midpoint Hidden Pivot resistance at 6226.25, but closed slightly above it. The question now is how much stopping power the target will show. If little or none, we can expect the rally to continue to at least 6938.00, a target calculated by sliding the 'a' low five bars to the left, to 6540.25. Above it there is only one logical target left: 7499.75. It comes from a blended monthly chart (A=3502.00, on 10/31/22), and although it will be good enough for government work, we shouldn't expect it to show precise stopping power.
When a correction fails to reach its 'D' target as could occur here, it implies the dominant trend, a 16-year-old bull market, will continue. MSFT could still relapse to d=431.89, but we'll give bulls the benefit of the doubt for now with a rally projection to at least 526.24. That's the 'd' target of a pattern on the weekly chart begun on 9/5/25 from 492.37, and it will become an odds-on bet to be achieved when the stock pops though 495.57, a midpoint resistance that comes from the same pattern.
This is the first chart I've drawn that projects a gold price above $5000/oz. The pattern is probably too obvious to work precisely, but that won't negate its ability to keep us confidently on the right side of the trend. A theoretical buy signal has already been signaled with the thrusts through the green line (x=4234.40). However, we can't know how likely the 5126.10 target is to be achieved until we've seen buyers interacts with the midpoint Hidden Pivot resistance at 4529.79. For now, we can use it as a minimum upside projection. As always, a decisive move through p, and particularly a close above it, would shorten the odds of a continuation to D.
The 63.39 rally target is ambitious, considering we've yet to see how bulls handle the pattern's midpoint Hidden Pivot resistance at 57.60. It became a logical minimum objective two weeks ago, when the futures first popped through the green line (x=51.70). The pattern is unusually elongated, but because of the rough visual symmetry between the two down-legs at either end, it winds up being the only ABCD configuration available on the weekly chart. Regardless of its quality, price action at p cannot but tell us whether bulls have the energy to power this vehicle to the target. Since the trend is so well-developed, however, jumping on and off will be difficult at best and should be managed using 'camo' (i.e., small-pattern) trade triggers in either direction.
There's little doubt that GDXJ will achieve a minimum 114.22 in this run-up (see inset). Although it struggled for a while to get past the midpoint Hidden Pivot at 100.80, the ballistic breakout that ended the week should prove well-nigh unstoppable. However, because a 'd' target at 111.59 maxes out the monthly chart (a=96.72 on 2/26/10), we'll have to do the best we can with lesser charts and patterns if and when the ascent surpasses 114.22.
Like UFOs and Bigfoot, far more bear market sightings are imagined than real. I thought I'd spotted Papa Bear myself when Nvidia announced terrific earnings a couple of weeks ago, only to see their shares reverse and dive sharply after a deceptive spike higher. Was this the needle prick that burst the AI bubble? It certainly seemed like it; for it was not merely plausible, but logical, given that Wall Street and the entire investment world were desperately counting on a single company, albeit a $5 trillion one, to turn sagging markets around. They got their wish, but it was a delayed reaction that must have spooked many investors. Stocks plunged for several days after the announcement before catching a bottom and reversing steeply. Your editor was one of the non-believers who were certain stocks had entered a bear market that was long overdue. It wasn't just Nvidia's performance, either. Trump's fortunes, if not to say his very credibility, seemed to be ebbing, in part because his nemesis Epstein was creeping back into the headlines. The President was uncharacteristically back on his heels, seemingly in synch with falling stocks. But within a few days, NVDA appeared to be basing, Trump was masterfully diverting the news media toward a possible peace pact between Russia and Ukraine, and stocks were in a steep recovery. It was sufficiently ferocious to seem like a classical bear rally, and that's what I assumed it was -- until, that is, in just three days, the broad averages had already maneuvered to within easy distance of new highs. That was on Friday, and there's no point pretending the rally is a fake, destined to end with a whimper. Place Your Bets I continue to believe, nonetheless, that stocks are in a topping process. However, a bear market
