Rick’s Picks

The gnarly ABC pattern shown implies a strong bull leg ahead to as high as 3206.25. It would be equivalent to a 600-point rally in the Dow. The point 'A' low is pretty weak to match up with last week's nasty B-C correction, but it's all we've got. Considering the alternatives, it is certainly good enough for government work. It's also good enough for us to take seriously the 3137.88 midpoint Hidden Pivot resistance.  Judging from the way buyers impaled it on Friday, the uptrend has at least two or three more days to go. That would be well in line with a blowoff to D=3206.25 and potentially congruent with a drop in VXX to a longstanding target at 15.66. Don't hesitate to buy some close-in calls pegged to a strike of 17 or higher if that happens. _______ UPDATE (Dec 9, 9:15 p.m.): Most of today's price action took place above p=3137.88 (see tout). That not only shortens the odds of a move to D=3206.25, it also makes a pullback to X=3103.69 an enticing 'mechanical' buy. The 3069.25 stop-loss implies $1700 of theoretical entry risk per contract, but there are alternative entry strategies in the Hidden Pivot arsenal that could cut that by as much as 90%.  Stay tuned to the trading room for real-time tips. ______ UPDATE (Dec 12, 9:05 p.m.): Nothing has changed, but a dip below 3106.75 would darken the outlook in proportion to the size of the breach. FYI, 3106.75 is a midpoint pivot, on the hourly chart, tied to A= 3158.00 on 12/2. _______ UPDATE (Dec 11, 10:41 p.m.): The futures are taking their sweet old time, but that has not changed the bullish outlook for the near term. Even so, I am no longer recommending a 'mechanical' buy at 3103. _______ UPDATE (Dec

Gold has disappointed and bullyragged its most devoted fans for more than three months, but it could become an enticing speculative buy as it approaches a key low at 1418.90 recorded back in August. The bearish pattern shown is not the largest among several alternatives, but it shows promise nonetheless to deliver a tradeable bounce at or very near the pattern's 1440.00 target.  I'd prefer to initiate the trade via an rABC pattern, since that's probably the least risky way to catch the falling javelin.  If so, we'll look at using A=1465.40 (from 12/3 at 2:00 a.m.) Stay tuned, however, since the set-up will depend on how easily the downtrend achieves 1440.00, assuming it does. ______ UPDATE (Dec 10, 9:12 a.m. EST): The futures are rallying  moderately even though the S&Ps are slightly higher. This is unusual, so we'll give bulls the slight benefit of the doubt. You can use this pattern to trade the move. _______ UPDATE (Dec 12, 9:07 p.m.): Zzzzzzzz. _______ UPDATE (Dec 11, 10:52 p.m.): The pop through p=1478.10 has made the February contract a good bet to reach the 1493.10 target shown. If there's a pullback to X=1470.50 first, ideally in the first half of the session, it would trigger a mechanical buy, stop 1462.90. _______ UPDATE (Dec 12, 11:23 p.m.): How's that for nasty? Even so, based on reports in the Trading Room, subscribers who got long for a shot at the 1493.10 target got out with a nice profit before the futures reversed precipitously. From a high just $1.50 shy of my target, they dove $36. Overall, the price action was neither bullish nor bearish, just nutty. Gold appears to be biding its time until the stock market cools off and the chimps turn their attention to 'risk-on.' ________ UPDATE (Dec 30, 5:47

AAPL remains an excellent proxy for the bull market, so perhaps it’s a good time to look at its intraday charts, the better to judge whether December’s shaky start portends more trouble. My gut feeling is that the weakness will pass, if it hasn’t already, and that both the stock and the broad averages will soon be banging out new record highs. This scenario will become more likely if AAPL blows past the 266.11 midpoint Hidden Pivot shown in the chart to end the week. That would put it on track for a shot at D=269.55 next week, and, presumably, generate corresponding strength in the broad averages. A rendezvous with D could provide us with more information, but I expect sufficient resistance there to set up a potential ‘reverse-ABC’ short. Stay tuned to the Trading Room for timely guidance. _______ UPDATE (Dec 6, 1:49 p.m. EST): Short-covering at the opening sent AAPL into a lunatic spasm that not only demolished the 266.11 midpoint resistance, but continued higher, eventually reaching and then surpassing the 269.55 target. When it did, I put out a new target at 270.94 (“not rocket science”) in the Trading Room that appears to have stopped the rally cold.  AAPL has since fallen $1.04 (!) after peaking at 271.00, six cents above my target.  _______ UPDATE (Dec 8, 5:10 p.m.): We still hold eight 280 calls with a cost basis of 0.16 that expire on Friday. Offer half of them to close for 0.62, good through Tuesday. _______ UPDATE (Dec 11, 11:14 p.m.):  The uptrend has been steady but not steep enough to revive our calls. We'll play the hand we've got rather than speculate on more expiring options.  Use 274.18 (60-min,  A=261.74 on 12/4)  for a target -- not quite enough to make 272.50 calls @ 1.00

The feisty, 50-point bounce off Tuesday's fear-stricken lows allowed subscribers who followed the simple 'counterintuitive' buying strategy sent out Tuesday evening to book profits of as much as $4200 Wednesday morning on a four-contract position. The futures ended the day above the 3103.00 midpoint Hidden Pivot, implying they are likely to reach the 'reverse ABC' pattern's 3136.25 target at least.  If this Hidden Pivot resistance is easily breached, or if the December contract close above it, that would portend a test of the all-time high recorded last week at 3158.00 and, presumably, a decisive move past it.

I didn't contemplate putting out a bullish trade in this vehicle when I sat down late Tuesday night to update touts for Wednesday, but there it was, hanging like ripe fruit from a low branch: a textbook 'counterintuitive' buy signal at the green line (3093.25), stop 3069.25. The  trade is predicated on a rally to at least p=3117.00, and I am unable to find anything seriously wrong with the pattern itself. Even the position of the point 'C' low in relation to the cliffhanger 'A' is heavy on fear factor -- the key ingredient of the CI set-up.  Entry risk could be reduced a tad by converting this to an rABC trade where A= 3097.75  (11/22 at 10:30 a.m.), but please note that this gambit is already live as of 3:00 p.m.

Monday's dive was a sample of what we should expect when the still hibernating bear finally emerges.  Mr Market not only delivered a swift kick in the balls, he did it while we were sleeping. I'd sent out a 3160.25 rally target last week and stuck to it even after a rally died just five points shy of it. Lo, short-covering bears got second wind Monday morning, pushing this gas-bag to a 3158.00 top that would have been easily shortable using an rABC set-up. Trouble is, the high occurred at 4 a.m. when most of us were sleeping. We shouldn't hope for great opportunities to come at convenient hours, because that's not how the game works. But we will need to be aggressive if we are going to seize whatever crumbs come our way.  For now, I have no new targets to offer, nor even a confident sense of where the futures might be headed next. _______ UPDATE Dec 3, 7:55 a.m. EST): The opening is nearly 90 minutes away, but the futures are not getting much bounce off the gnarly Hidden Pivot pattern  shown here, with a 'D' target at 3098.75.  This is not a healthy sign. DaScumballs will valiantly keep trying to exhaust sellers, groping for a bottom in order to short squeeze the opening. We shouldn't bet against their success at rigging the game in this way, but it behooves us to treat whatever rally is coming with care and skepticism.

The 3160.25 rally target we've been using to keep us properly bullish remains to be achieved. Even though Wednesday's push to 3155.00 came close, it wasn't as close as we should expect, given the way buyers took out the 3125.50 midpoint resistance earlier in the week. All that aside, the futures are trading above a major trendline after impaling it last week, presumably adding to the euphoria, so extra caution is warranted.  That means monitoring price action at 3138.00 for now, a minor Hidden Pivot support that should be expected to produce a tradeable bounce (15-minute, a=1555.00 at  6:15 pm. EST on 11/27).  A 3138.25 bid for a single contract, stop 3136.25, is suggested. You'll be on your own if the order fills. _______ UPDATE (Dec 1, 11:31 p.m.): Cancel the bid, since the futures have rocketed skyward after having gone no lower than 3139.50. _______ UPDATE (Dec 2, 10:14 a.m.): And now stocks are plummeting. It would appear that 'trade hopes' have faded just a smidgen this morning.

Friday's exuberant but inexplicable leap may have felt encouraging at the time, but a chart that goes back a few months makes the rally look far from impressive. Even so, bulls deserve the benefit of the doubt for the moment, since the move was indisputably going their way at the closing bell. It would take a print at x=1491.30, the green line, to trip a theoretical buy signal, but only 1474.80 would be needed to generate a bullish impulse leg on the hourly chart. That could set up an appealing trading opportunity intraday, so stay tuned to the Trading Room if you're eager to play. _______ UPDATE (Dec 3, 10:05 a.m. EST): The futures have taken wing this morning and appear bound for a minimum 1489.50. If this Hidden Pivot is easily exceeded, bulls could take heart. Here's the updated chart. _______ UPDATE (Dec 3, 11:09 p.m.): Buyers should have been able to reach the 1489.50 target shown in this chart on the first try but failed. Disappointment would fade if they get second wind and take out the 1496.30 'external' peak shown, but until such time as that happens we shouldn't get our hopes too high. _______ UPDATE (Dec 4, 6:14 p.m.): The futures dove $12 after peaking at 1489.90, four ticks above the target flagged above. That is well shy of the 1496.30 I'd said was needed to turn the intraday charts unambiguously bullish.  I'm going to raise the bar a tad just to be cautious, stipulating that the rally achieve 1503.10, just above the external peak shown in this chart, before I ratchet down my skepticism. Incidentally, a Trading Room denizen reported having used the 1489.50 target to get long and exit the position at the top for a nice profit.  He posted as follows: "Exited the

I've presented the 3147.50 target shown in the chart as a challenge to bulls, but based on ten years of price history, we shouldn't doubt that they will make short work of it. I would nonetheless encourage you to consider rABC shorts that utilize the target, provided you know what you are doing. If the trade sets up and triggers in the wee hours, it will enjoy good odds of at least a small payoff; after the opening bell, perhaps not so much. An easy move past 3147.50 would put in play a 3160.25 target, calculated by sliding the point 'A' low down to Nov 6's 3063.00 bottom. _______ UPDATE (Nov 29): The rABC trade triggered around 6:30 a.m. Wednesday at 1348.25, producing a theoretical gain of $100 to $400 per contract, depending on whether you covered the short at p or d. The futures subsequently went nowhere after breaking above the intraday high (aka our point 'C' high). They were continuing to screw the pooch on a very dead Friday.