Although Silver's explosive rally over the last few days has nearly maxed out the hourly chart, bulls have reason to celebrate. As you can see, the rally exceeded a key external peak at 25.120 recorded seven years ago during the summer of 2013. The move has generated the most powerful impulse leg this vehicle has seen in nearly a decade, and it implies that any significant pullback in the weeks and months ahead be regarded as a buying opportunity. Stay tuned to the chat room, since we finally have a trend we can trade aggressively. ______ UPDATE (Jul 28, 5:06 p.m. ET): The violent price swings we saw today ended with the futures idling placidly in the exact middle of the range. This is peculiar though hardly bearish, since it suggests that even after getting viciously trapped at Monday night's highs, bulls were back at it hours later, chastened but not the least bit fearful. Let's step aside for a day and see how it goes. When the old high gives way, look for further upside to a marginal new high, at least, at 26.56 (60-min, A=22.175 on 7/22). Evening note: night owls can try bottom-fishing at 22.888 off this pattern on the 60-min: a=26.275; b= 22.46; c= 24.795 ( 7/28 at 11:00 a.m. ET)
The dollar's steep fall since March mirrors the egregiously overdone rally that has occurred in nearly everything else. There is no good reason for the dollar to be plummeting, but on Wall Street a bad reason will always suffice, especially in times when outright insanity rules the markets as it is doing now. That said, there are reasons to expect a turn from the current low, which touched a 93.57 downside target on the hourly chart Monday. I'd be surprised if there's no significant bounce, given the clarity of the pattern, However, I am prepared for more slippage nonetheless, possibly to the trendline shown. It comes in around 91.61, almost exactly two points lower. Here's a chart that shows this. Regardless, the pullback to the green line (94.48) must be regarded as a promising 'mechanical' buying opportunity, stop 88.24. We'll paper trade this one, but I should note that all such trades presented here over the last several months have been winners. ______ UPDATE (Jul 29, 7:37 p.m.): Any further slippage beneath the 93.57 'hidden' support will send the dollar down to 91.61 in search of good traction. ______ UPDATE (Jul 30, 2:39 p.m.): So much for the 93.54 support. You should use 91.61 as a downside objective for the near term. _______ UPDATE (Aug 3, 5:48 p.m.): Despite the rally since Friday, the damage has already been done, and I still expect lower lows. Regardless, I'm going to back away for a week or two, since price action in the currencies in general has gotten extremely tiresome. They used to be good 'non-correlating' vehicles to trade, but these days even the 100% manipulated Swiss franc acts like an eighth grader's science project.
The futures have bounced robustly after coming nowhere near our opportunistic bid at 9579. Now they appear bound for the 10746 Hidden Pivot target of the pattern shown. A run-up to that number, at least, is very likely because of the ease with which buyers turned the 10628 midpoint resistance into support in less than a day. If the rally pokes through 10746 decisively, that would telegraph a likely test of all-time highs just above 11,000 recorded last week. It is not yet a given, however, since the broad averages have seemed heavy for more than a week, notwithstanding that most days have produced at least modest gains. ______ UPDATE (July 28, 7:01 a.m. ET): The futures topped overnight at 10758, a tenth of one percent above where predicted, before selling off sharply. The 12-point overshoot is most surely not sufficient for us to assume that a test of the old record high is inevitable. _______ UPDATE (Jul 29, 7:44 p.m.): Buying interest has been close to zero, but DaBoyz evidently are determined to keep this hoax aloft for distribution until the last sucker has been coaxed aboard. This is apparent in the failure of perfectly fine, minor ABC downtrends to even reach their Hidden Pivot midpoints. Here's what I'm talking about.
Bears have lacked the will and the guts to follow through on last week's hard sell-off. Instead, AAPL has launched into a wafting rebound, punctuated Monday by an opportunistic leap on the opening bar. Shorts had better be prepared to get squeezed all the way up to D=387.84, a minor rally target shown in the chart. It will be scant consolation to AAPL skeptics at this point, but the failure of the opening-bar goosing to exceed an external peak at 379.87 recorded last Thursday on the way down is a subtle sign that bulls' confidence is ebbing, even if only slightly. As a practical matter, this will enhance our odds for getting short at midpoint and secondary Hidden Pivots, as well as D targets similar in degree to the ones shown. ______ UPDATE (Jul 28, 5:24 p.m. ET): So much for shorting into strength. There was none, only a feeble opening that suggested DaBoyz were setting up a distribution day from the get-go rather than attempting to goose shorts off an oversold opening bar. Now watch AAPL fall to at least 359.52, the midpoint Hidden Pivot support of this pattern. You can scalp-trade some calls down there provided the stock gets within 3-4 cents of the target. _____ UPDATE (Jul 29, 8:04 p.m.): What on earth could I have been thinking when I predicted the stock would fall to at least 359.52? This is the most popular stock on earth, and none of its torqued institutional sponsors are even thinking about parting with a single share. It looks bound now for at least 386.96, the target of the ersatz ABC pattern shown here. This impulse leg isn't good enough, even, for government work, although I'm sure it will work perfectly well for AAPL. Jump on a pullback to 376.52 using
Bears struggled unsuccessfully to push stocks lower Friday following a weak opening, implying DaBoyz will have things well under control when trading resumes Sunday evening. Accordingly, I'll recommend using a 'mechanical' bid to bottom-fish at p=3158.25, stop 3080.00. This implies entry risk of $3900 per contract, so the trade is recommended only to those who can cut the risk by at least 85% using a 'camouflage' set-up. If you're new to mechanical trades, try paper-trading this one to help build your confidence. Our winning streak for these set-ups is probably at around ten now. The ultimate destination is an absurdly bullish Hidden Pivot at 3392.75 that has been in play since mid-June, but which became even more likely two weeks ago when buyers crushed p=3158.25. _______ UPDATE (Jul 27, 5:03 p.m. ET): Even with headline help from a Fed worried about a deep economic relapse, bears were unable to push the futures down an inch, let alone to the 3158.25 midpoint support where we'd hoped to do some bottom-fishing. The 3392.75 rally target remains viable, although bulls have shown little energy or eagerness themselves to get there. _______ UPDATE (Jul 29, 6:26 p.m.): Steady distribution has been quiet but palpable, which is to say: sneaky. Even so, bears have been too intimidated to act, making it painful to hold short positions ahead of the inevitable plunge. Sunday night is the most logical time for one to begin, and so we'll look to take home a few puts on Friday. It will require news to trigger the selloff, but one shudders to think about what the news might be in these already way-too-interesting times. _______ UPDATE (Jul 30, 2:50 p.m.): With news out that GDP fell an annualized 34.5% in Q2 and no relief in sight for the pandemic-stricken economy, it's no
Today's downdraft generated a robust impulse leg on the daily chart, the first time this has occurred since the start of the Covid-19 outbreak in February. Supposedly, fears are growing that Trump's hardball tactics with China could put pressure on AAPL, which does nearly all of its assembly work in China. Why traders picked today to unload Apple shares is unclear, however, since the company's China problem has existed for nearly three years, ever since the tariff war began. Trumped warned Apple years ago to get out of China, but it would seem no one in Cupertino took him very seriously. That didn't stop investors from piling into the stock since March, driving it into a ridiculously steep rally that was manifestly inured to troubles with China's Communist government. So how far could the stock fall? That depends on whether the downtrend stretches on for another 2-3 days, breaching a 351.28 low recorded nearly a month ago. If it happens with no significant upward corrections along the way, that would add to the imputed power of the impulse leg, conceivably signaling the beginning of a new bear market.
The pullback from a record high precisely at p2=11,054 should have bulls worried. This is the pattern's secondary pivot, and it would not be the first time that it has stopped a strong rally in its tracks. That is why I called it a potential giant-killer here yesterday, although I was referring to the p2 of a smaller pattern associated with the S&P 500 Index. I doubt that it is mere coincidence that both vehicles have stalled where they did. Now we should expect a retracement to at least p=9579, a midpoint Hidden Pivot that lies nearly a thousand points below. The good news is that the futures would become a fetching 'mechanical' buy, at least in theory, on such a pullback. There are still higher targets outstanding in the major indices, and that's another reason for optimism. Whatever happens, it looks as though bulls are about to have their mettle tested for the first time in four months.
If Tuesday's high turns out to have marked an important top, it occurred in a logical spot -- almost precisely at the midpoint resistance of a weeks-old bullish pattern projecting to 11688. Even so, bulls held their ground, closing this bloated gas-bag midway between the day's high and low. My gut instinct would be to short into moderate strength on Thursday's opening, since the Naz look so fatigued. It would become a so-so 'mechanical' buy on a pullback to the green line (10,691), but I am not recommending this unless you know how to cut the risk down to relative pocket change using a 'camouflage' set-up.
A cluster of 'hidden' resistance levels not far above suggests that a major top could be imminent. They are numbered to indicate my first, second and third choice of Hidden Pivots with the potential to stop Covid-mania dead in its tracks. Two of the pivots come from the ABC pattern labeled in blue, and they represent, respectively, the p2 'secondary pivot' and D target of that pattern; the third, in pink, is the secondary pivot of a giant bullish pattern stretching back to 2016. All can be shorted with a tight stop loss, since I expect each in succession to show very precise stopping power. If the opportunity arises, however, you should act most aggressively and with a wider stop-loss at the topmost pivot, 3432.15. _______ UPDATE (Jul 26): Last week's high fell 35 points shy of the lowermost target shown in the chart, 3315.50. The subsequent pullback was relatively mild, and the week ended with bears struggling to push the futures any lower. Unless the tempo of the selling picks up by mid-week, look for bulls to regain the upper hand and make another stab at 3315. _______ UPDATE (Jul 29, 6:50 o.m.): Bears are quite depleted, allowing DaBoyz to turn a 3198 midpoint resistance into support with little buying. They are waiting for the right news to pop this beast to p=3315, but I doubt it will go much higher straightaway, so be prepared to lay out shorts there.
Careful! August Gold is closing on a potential rally stopper at 1877.40. I expect a push above it, perhaps after a brief stall, but if buyers blow past it Wednesday night or early Thursday, they'd be in good shape for a romp to the 1992.40 target shown in this chart. I have adjusted it slightly downward from the 1994.40 given here earlier because one of the original coordinates was wrong. The precise pullback from p=1830.40 in the second chart suggests that when the 1992.40 Hidden Pivot is reached, it'll be a good opportunity to lighten up. As far as I can tell from the discussion in the chat room, all subscribers who trade gold have been long with confidence and are enjoying the ride. ______ UPDATE (July 23, 5:35 pm.): Bulls are closing on p2=1911.40, a secondary pivot associated with the 1992.40 target shown in the chart linked above. It is all but guaranteed to be reached, but be prepared for a stall and the start of a correction lasting for as long as a week or two. Alternatively, if the futures blow past the pivot, closing above it for two consecutive days, that would imply 1992.40 has become and odds-on bet to be reached and that this will happen sooner rather than later. _______ UPDATE (Jul 27, 7:14 p.m.): The cruise to an almost certain rendezvous with 1992.40 has been effortless if unspectacular. This Hidden Pivot should evince tradeable stopping power, although I don't intend for you to get short there. The round number $2000 is the more formidable obstacle, but there is nothing in the technical picture to suggest an important top will occur at that height. _______ UPDATE (Jul 28, 7:07 a.m.): Tricky, vicious and gratuitously nasty as always, gold topped overnight at $1974 -- just $18,
