Rick’s Picks

Get AAPL right and your big-picture forecast for the stock market will never go far wrong. Apple is the World's Most Valuable Company, after all, and therefore a must-own for every portfolio manager who wants to keep his or her job. That's why it's the only stock we need follow in order to know exactly what's on institutional investors' tiny, fevered minds. So how have our AAPL predictions fared? On Wednesday the stock plummeted yet again, bottoming just six cents from the 185.87 target hung out here two nights earlier when the stock was $12 higher. It turns out that I made a slight error when I drew the target pattern, and that the correct coordinates would have nailed the actual 185.93 low to-the-penny. Okay, so you're probably wondering what's coming next. A fair question. First of all, there is still room for a major bounce from slightly lower -- from 185.12, to be exact. This Hidden Pivot support differs from the one at 185.93 because it is based on highs and lows that occurred during the night session. If the support fails, it would increase the odds that the bull market begun in 2009 is over. What would constitute a failure? Considering the delicate precision of the pattern used to calculate the target, an overshoot of more than $1.00 (or so), or a two-day close beneath 185.12, would probably prove fatal.  That's why we'll be watching closely to see whether the so-far feeble rally from the initial target gets legs. If it exceeds 197.18 without going significantly lower first, bulls could breathe a mild sigh of relief._______ UPDATE (Nov 19, 9:31 a.m. ET): AAPL is getting whacked ahead of the opening bell because of a reported slowdown in iPhone sales. As the stock continues to fall, keep in mind

In my forecasts over the last year, I've treated bitcoin with skepticism and disdain, to put it mildly. (Check out the $BRTI tout at the bottom of the Rick's Picks home page to see how I've scorned not just cryptocurrencies, but those who have loudly hyped them for personal gain.) My strong doubts will have spared subscribers who have been habitually bullish on block-chain currencies a world of pain. However, recent developments are threatening to turn me bullish despite my deep distrust of 'money' that any Tom, Dick or Harry could start ginning up tomorrow. Be that as it may, bitcoin has taken a steep dive this week after falling off a ledge thousands of dollars above the very bearish target we've held in mind since January. If it hits that target, which lies at 4396 (basis the CME's real-time bitcoin index, symbol $BRTI), even I would be a buyer. And although I don't expect a trampoline bounce from my number, I am confident it will offer a relatively safe and precise spot for bulls to start accumulating a stake. If you held off buying until now because my forecast scared some sense into you, consider taking a free trial subscription to see what other cool stuff we're doing behind the subscriber wall.

I argue below for monitoring AAPL's price swings obsessively, since the stock will give us an infallible 'read' on the stock market as a whole. On Wednesday, for instance, when AAPL began its bounce precisely from a 185.87 downside target I'd billboarded two nights earlier, the broad averages whipped around 180 degrees and took off like a shot. It was exactly 2:07 p.m. ET, and the Dow was banging out its intraday low at 24935, down 350 points.  The subsequent 328-point upthrust hit 25263, at which point the Dow was within 25 points of unchanged. The blue chip average relapsed in the final hour, presumably because its guiding light, AAPL, was unable to sustain altitude. I've provided benchmarks for AAPL for Thursday that will allow you to see for yourself how the stock's targeted highs and lows can be used to precisely time price swings in the broad averages. For the foreseeable future, AAPL will be leading them by the nose.

Lurkers missed a field day Tuesday in the Rick's Picks chat room. Crowdsourcing among Hidden Pivot experts found profitable ways to make money on both sides of the market in such diverse vehicles as crude oil, Beazer Homes and Canopy Growth, an NYSE biggie in the reefer madness category.  Crude fell particularly hard, and although some subscribers profited by going with the trend, others used the lows of precisely targeted corrections to ski up an avalanche.  Beazer, a homebuilder in a depressed sector, announced strong earnings and a share buyback, causing the stock to leap from $8.41 to $11.26 in the early going. The intraday high matched the 11.26 forecast I put out in the chat room to-the-penny, allowing one subscriber who also happens to be a bearish homebuilder to short 3000 shares at what proved to be the high of the day. The initial pullback to $10.61 worked out to a 4.2 bazillion percent gain when annualized. Want to get in on the fun? Click here and you'll have instant access to the chat room and a free two-week trial subscription to all features and services.

Updates for all of the trading vehicles tracked below are bearish, implying that Monday's hard selloff did not exhaust the downtrend. Even so, our two key bellwethers, AMZN and AAPL, are both close to interim supports that look likely to evince tradeable rebounds. I am becoming less enthused by the day about bottom-fishing such supports, however, because two such attempts in AAPL over the last week seriously underestimated the intensity of the selling.  Old habits die hard, and we've become used to buying weakness in the FAANG/lunatic stocks even as we've disdained the buy-the-dips mentality that has prevailed on Wall Street for almost a decade. Because of the growing likelihood that stocks have entered a bear market, any bottom-fishing we do henceforth will necessarily be more cautious than before. We'll get more leverage, for sure, since short-covering rallies are going to be more vicious than ever; however, the risks of being wrong have increased commensurately.

Sellers demolished a Hidden Pivot midpoint support at 197.97 on Monday, implying they are likely to push AAPL down to at least 185.87 before they are spent. Droves of buyers evidently stand ready to pounce on the stock near 190 if their posts in the blogosphere are to be believed. But the charts suggest they may have to put up with a little more pain than expected before the stock finally turns around.  It will be trading 20.7% below its all-time high by then, presumably fully corrected for what promises to be a rollicking bear rally. Keep in mind when this happens that Apple, the world's most successful purveyor of overpriced goods, will be more vulnerable than most retailers in the next economic downturn. This means that even iPhone cultists may not be so eager to shell out $800-$1000 every three years for the latest model. And while the company intends to shift its business more toward 'services', so will the competition -- presumably very aggressively in a recession. This won't be an ordinary recession when it finally kicks in, either, since the economy will be unwinding ZIRP madness that has pumped just about every asset other than bullion full of gas. As The World's Most Valuable Company, are Apple shares about to become the bear market's Hindenburg?

The FAANGs barely blipped on Friday, suggesting they will continue to drag the broad averages lower. They fell by nearly 3%, performing much worse than the Dow and S&P 500, which shed, respectively, 0.7% and 1.0%. Expect portfolio managers to continue rotating money between the high-fliers and the stock market's also-rans, with the goal of sustaining a passable illusion of buoyancy in both. However, next time shares across all sectors move synchronously, be ready for the move to be steeply lower. We should remain open in the meantime to the possibility of sharp, out-of-the-blue rallies like last Wednesday's post-election show of bravado. It was driven entirely by short-covering that for the time being will remain capable of pushing a relative handful of stocks to new record-highs. AAPL in particular, because it is the most valuable company in the world, can tell us how likely this is to happen. It is an infallible proxy for institutional mindset, along with AMZN, which will be with it each step of the way. These two stocks will keep us confidently on the right side of the trend. If you don't like to be fooled or surprised, stay tuned them -- and to Rick's Picks .

Bulls flunked two tests with last week's rally: 1) they did not reach the 1794.10 midpoint Hidden Pivot shown, which was our minimum upside objective; and 2) they died inches shy of the 1794.81 'external' peak recorded on October 5. This was a weaker performance than we saw in the E-Mini S&Ps, which exceeded a corresponding midpoint resistance, although not the external peak. Because of this 'divergence,' we'll need to keep close tabs on both to determine whether the bull market is likely to get second wind. My gut feeling is that the E-Mini chart's bullishness is stronger than AMZN's bearishness and that bulls will ultimately prevail. Be aware, however, that I have warned of a possible bull trap if the S&Ps achieve new record highs._______ UPDATE (Nov 12, 8:21 p.m. ET): Use the 1599.68 midpoint support shown in this chart as a minimum downside target, and be ready to exploit a bounce from it if you trade the stock. _______ UPDATE (Nov 14, 9:38 p.m.): Today's $2.61 overshoot of the midpoint pivot is not visually significant, but if this 'hidden' support were to be exceeded decisively in the days ahead, that would put a 1415.36 target in play._______ UPDATE (Nov 15, 7:43 p.m.): If the bounce from today's sold-out low hits 1691.84, shown in this chart as a green line, it would trigger a mechanical short there, stop 1784.25. With initial risk of $9200 per round lot, we'd want to consider 'camouflage' options for doing the trade.

Last week's tentative rally has made a tiresome battle between bulls and bears more likely over the next 2-3 weeks. My hunch is that the bulls will prevail, eventually pushing the futures to a test of all-time highs near 2950 recorded in late October. I am leaning bullish because the rally decisively exceeded a 2775.13 midpoint Hidden Pivot resistance shown in the chart as a red line. However, the surge failed to exceed a key 'external' peak 2824.25  recorded in mid October. This somewhat timid price action has possible implications for the future, since it may foreshadow a bull trap the next time the E-Mini S&Ps are in record territory, assuming they get there.  This may sound a little crystal ball-ish, but it is simply a straightforward application of Hidden Pivot rules that have been tested and corroborated many thousands of times._______ UPDATE (Nov 12, 8:31 p.m. ET): The pattern shown tripped a 'counterintuitive' short at the green line, putting in play a 2707.13 Hidden Pivot midpoint support that is likely to generate a bounce that might be tradeable. If not and the futures bust the support easily, look for more slippage to as low as 2596.50 over the near term. _______ UPDATE (Nov 14, 9:46 p.m.): Today's moderate selloff missed the minor D target at 2679.50 shown in this chart. It remains viable, but if the futures reverse without hitting it and go on to exceed 2755.75, bulls would be back on the offensive, with a shot at 2871.00.  Alternatively, a decisive downside breach of D would leave the 2596.50 target given above in play._______ UPDATE (Nov 15, 7:47 p.m.): The futures tripped a theoretical buy signal for a shot at 2760.00 or perhaps even 2848.75!  Check out my 14:21 post in the 'Saloon' for a bullish trading idea