Webinar

The markets were severely constipated -- not only because it was the morning after a big, nastyy election, but because traders were waiting for yet another m-o-m-e-n-t-o-u-s announcement from Bernanke concerning quantitative easing to come. We pored over charts for the E–Mini S&Ps, gold and the dollar nonetheless, and we even tested the water with a real-time bottom-fishing trade in the S&P futures. (I won’t spoil the ending for you.) The day was interesting from an analytical standpoint because the E-Mini S&Ps had reached a very crucial threshold at 1196.50 the night before – an event that we deconstructed with due diligence.

The broad averages and bullion were being driven by news this morning -- soft speculation that the latest round of quantitative easing would amount to just a few hundred billion dollars rather than the $1Tr-$2Tr that had been rumored. Gold and Index futures were especially volatile as a result, and we had a ringside seat on the intraday charts to watch the action. This session also provides a good review of Hidden Pivot basics, since the room was packed with scores of observers who were guests of our broker affiliate, PFGBest.

Gold, Silver and the E-Mini S&P were in sharp rallies, recovering in symmetrical fashion from the previous day’s hard selloff. Although this gave us some sweeping patterns to look at, they didn’t translate into easy opportunities for “camouflage” trading, since well-defined trends draw crowds that we should prefer not to compete with. Still, there were lessons to be drawn, and opportunities to be gleaned, even from markets whose intentions were all too clear.

October 13, 2010: Creating a Matrix from Rick Ackerman on Vimeo. Come to your desk each morning armed with a “matrix” of Hidden Pivots, and not only will you never be caught off guard by that swoon in Gold that we all know is coming someday, you will also have a schematic of price levels to see you through a successful trading day. We discuss the matrix – essentially, a table that shows permutations of Hidden Pivot midpoints and ‘D’ targets drawn from various time frames – during this session. Finally, we identify some possible trades for later in the day in Gold, Silver and the E-Mini S&Ps.

Gold and Silver have been in such steep rallies that they are about to exhaust the supply of ‘D’ targets on their respective daily charts. This means we’ll soon have to use weekly charts to project new targets, and to adjust our calculations so that they reflect the approximation of key highs and lows that occurs over the long term on composite charts. During this session, we tackle the problem with some relatively simple solutions. We also take a close look at the yen’s lesser charts, finding technical evidence to buttress our suspicion that the U.S. dollar is about to go down for the count

We caught a beautiful bottom in the E-Mini S&Ps, using a somewhat tricky pattern to get long a single tick beneath what turned out to be the low of the day. This was done bottom fishing-style – i.e., without camouflage -- because the set-up looked so enticing. The actual trade had been advised earlier that morning during a “trading room” session attended by more than 100 people. It was an hour later, during the weekly tutorial session, that we reviewed the trade and my rationale for using a 1.00-point stop-loss. (I’d dithered over using a two-tick stop (!) but eventually decided to go for, um, broke.) We also looked at Gold and Silver as usual, finding an additional reason to take seriously a 22.505 target for the December contract that I’d been drum-rolling for weeks.

A narrow focus on bonds, gold, silver and the E-mini S&Ps produced several tradable ideas that had yet to play out when this one-hour session ended. Gold and Silver were correcting the sharp rally of the previous day, and although we found reasons to expect more corrective action, there was no evidence of a serious selloff in the offing. You should check out the scalp-short we found in Silver, since the set-up was a real beauty and hard to miss on the lesser charts.

Tedious price action is not without its value in the classroom, as we were to discover during this session. We looked at turgid charts of Gold and the E-Mini S&Ps, mainly, and although not much was happening on either at the time, we were able to project respective trends that could have tradable implications not far down the road. This session was open to customers of PFGBest, and because hundreds of them attended, there was more emphasis than usual on Hidden Pivot basics. This recording is therefore a good one for relative novices to review.

Gold and Silver bulls will get a lift from this session, since it affirms a strong technical case for both metals. The ongoing rally in Comex Silver in particular – and Silver Wheaton shares, which we also looked at – shows no sign of weakening, and it looks as though some longstanding targets above $25 in SLW are all but certain to be achieved. We also scrutinized the charts of the E-Mini S&Ps and found little reason to respect the uptrend of the last week or so. Flaccid daily and hourly charts warned us off trying to find “camouflage” for a long entry, but there were no great prospects for getting short either.