Current Touts

Last week's subdued bounce created a bullish outside bar on the weekly chart, implying the uptrend will continue. However, if it reaches the green line (x=1925) that lies $70 above, that would trigger an appealing 'mechanical' short, stop 1976. That doesn't necessarily mean the futures would recede back into the bowels of hell, only that the short would be a good bet to return a one-level profit with a drop to the red line (p=1874.90) before the larger uptrend resumes. The 1774.50 downside target will remain theoretically valid nonetheless until such time as C=1975.20 is exceeded.

Silver's modest rally last week failed to trip a theoretical buy signal when it narrowly missed the green line (see inset).  The impulse leg that cued up the pattern is legitimate and even compelling, however, and that's why the resulting Hidden Pivot levels are likely to be useful for trading and analytical purposes once the futures have popped above x. The bull cycle is theoretically capped at D=24.45, but that doesn't negate the possibility that bulls will shred the target and make a run for structural resistance around $27. ______ UPDATE (Mar 7, 5:19 p.m.): Do shakeouts really have to be as brutal as today's kamikaze dive?  It put in play a hitherto unthinkable downside target at 18.51 that can serve as a worst-case objective for the next 6-8 days. The way sellers pulped the red line (p=20.32) implies that the target, as painful as it sounds, is hardly a longshot bet. More immediately, the selloff should have little trouble reaching p2=19.42, a secondary Hidden Pivot that can serve as a minimum downside objective but also as a place to attempt cautious bottom-fishing.

Since GDXJ's rally met all the conditions I'd imposed on it last week, it's time to throw more cold water on the bullish idea. The bearish case rests on the question of whether downside D=31.70, narrowly missed on the last bout of weakness, will ultimately be achieved. Regardless, a quick run-up now to x=38.80 would offer an excellent opportunity to get short 'mechanically'. The implied relapse shouldn't necessarily be expected to fulfill the downside D, however, and I doubt that it will.  I remain skeptical in any event that the bounce that began from Feb 24's bottom at 32.46 will get legs. I'd feel somewhat different about this if the third of my three conditions, a push above an 'external' peak at 35.15, had not required a one-day pullback and a running start. That is timid price action, and it suggests bulls don't yet have the moxie to blitz doubters.

Unlike the E-Mini S&Ps, AAPL peaked in early February without having exceeded October's 'external' high. This means the entire rally from the January low at 124 is not impulsive. In that context, last week's surge, which ended with a 3.5% gain on Friday, should be regarded as a bear tease. If I had to pick one vehicle or the other as representative of the stock market's potential over the next 3-5 weeks, I'd go with the laggard AAPL. Since subscribers seem uninterested in trading this vehicle (except when I serve up a profitable day-trade in the chat room, as occurred a couple of weeks ago) I'll say no more for now. Do nudge me in the room, however, if the stock does something to catch your attention.

Last week's goosing occurred in a place too obvious to be taken seriously. TLT opened Thursday on a gap beneath December's double low at 99.35, shaking out the many bulls who were counting on the low for last-ditch support. Without their drag to burden the bounce that ensued, Friday saw a vertical climb that began with a short-squeeze gap well above the previous day's close. The chart shows how far shy of persuasive the rally fell nonetheless, and what TLT must do before we can safely assume the bull market begun in October 2022 has resumed.

Our infallible stock-market bellwether remains mired in a bear market that could have years to run, but that doesn't necessarily mean a a collapse below $100 is imminent. A less serious fall to 135.95 would trigger a fetching 'mechanical' buy, actually, with a potential ride up to as high as D=171.28.  We'd likely take the money and run with AAPL trading well shy of that, since bear-market rallies are not supposed to reach their d targets. If there is anything in the chart that might give bears a ray of hope, it is the narrow failure of the short-squeeze begun from 124 to exceed October's 'external' peak at 157.  AAPL's institutional sponsors may be thieves, deceivers, cheats and bullies, but it turns out they are also too lacking in guts and conviction to fool this chart into turning very bullish. ______ UPDATE (Mar 1, 9:51 p.m.) The 135.95 'mechanical'-trade level mentioned above is looking increasingly likely to see action. Although that would imply a brutal plunge lies ahead, bear in mind that when the stock gets there and it seems like the end of the world, it will actually be an attractive BUYING opportunity.

A monthly chart stretching back nearly 20 years shows the devastation that has occurred in long-term Treasurys since they spiked to 179 as pandemic fears took hold in March 2021.  If TLT is ultimately on its way down to D=73.69, it's hard to imagine what the economic landscape would look like at that point; however, it certainly would not be in the ruinous state of deflation that I've long predicted.  More immediately, TLT signaled a textbook 'mechanical' short at x=108.84 that is all but certain to hit p=97.19 on the relapse. An easy move through this Hidden Pivot would leave it on track for a further fall to p2=85.44.

The tradeable 3796 target given here earlier can continue to serve as a minimum downside projection for the near term, but here's a somewhat different picture with a worst-case Hidden Pivot at 3373 that would be in play if February's so-far routine selloff gains momentum. For now, though, I am not enthusiastically on board with colleagues who are certain the bear market begun last January has resumed in earnest. In fact, bears have struggled in vain to hold this gas bag down, creating the miserable-excuse-for-a-C-D leg shown in the chart.  Moreover the Feb 2 high at 4208 refreshed the bullish energy of the daily chart when it exceeded an 'external' peak at 4914 recorded in December.  This increased the possibility that Mr Market will continue to grind bears to a bloody pulp no matter what happens in the real world. Indeed, anyone who sees a silver lining lining in today's headlines is experiencing psychosis. For trading purposes, here's a corrective reverse pattern that can be traded bullishly if the futures fall to the 3796 target. ______ UPDATE (Feb 28, 6:16 p.m.): Check out my instructions in the chat room this afternoon for buying put spreads in SPY. You can raise the suggested bid if the index continues to fall, or improvise a strategy using other options. Ideally, you'll want to buy the puts on intraday rallies, which for weeks have been failing with alarming but predictable regularity. One of these times, yet another fake rally is going to fail in a big way, since the wall of worry that has kept this bear market hoax going feels just about played out. _______ UPDATE (Mar 1, 9:38 p.m.):  Only one subscriber reported buying SPY puts as suggested, so I haven't established a tracking position. I've told him to hang onto a

The futures made progress last week toward the 1774.50 Hidden Pivot target that has served as our minimum downside projection for a while. The presumptive correction began nearly a month ago from 1975. It has been brutal, but the predicted low beckons as an opportune place to attempt bottom-fishing. As always, a camouflage trade trigger will be the preferred method to get onboard, since it can enable us to lose nothing or even make a few bucks even if we are wrong about where a bottom might form.