The options trading method I use to forecast swing points and trends is the most accurate and powerful I’ve discovered in 30 years of trading. It is also by far the simplest, requiring little more than junior high school math to do the necessary calculations. I first learned about this amazingly precise method of analysis from a floor trader on the Pacific Stock Exchange named Ira Tunik. At the time, Ira was using the cycles work of J.M. Hurst, a pioneer in the field of technical analysis, to make a very good living on the options floor. When he retired as a pit trader in the late 1980s, he shifted his nest egg mostly into bonds, which at the time were providing annualized returns approaching 10 percent. However, when interest rates began to decline from those cyclical peaks, Ira realized he would need a foolproof trading strategy to live well off his savings without having to dip into principal.
Over the next year-and-a-half, Ira delved exhaustively into the world of trading systems, reading every book he could find on Elliott Wave Theory, Gann Angles, Pyrapoint, Fibonaccis, oscillators, stochastics — even astrology. The system he finally settled on was called Lindsay’s Trident. But for reasons explained below, it took us both several more years and many modifications to tweak the system into its present, very powerful form. For starters, we discarded the core principle of Charles Lindsay’s trend-following system, substituting some stunningly effective corollaries that Lindsay himself evidently had failed to recognize. The result was a rules-based system that, combined with a little street-sense, can outperform some of the most powerful black box systems ever devised.
Stocks Breathe
At the heart of the system is a simple observation — that stocks breathe in and out, and that for every zig in a chart there is a zag somewhere else that corresponds to it exactly. Think of it as a flux of yin and yang energy seeking equilibrium at all times. Once you are able to identify the complementary zigs and zags, it becomes possible not only to discern the fundamental rhythms of the market, but to use this knowledge to predict price swings. This means, for one, that stop-losses of a point or less can be used to trade the Mini-S&P futures. Also, counter-trend entries are possible in the opening minutes of the day, when even the pros are typically on the sidelines waiting for the dust to settle.
This allows us to initiate trades at “uninteresting” prices where relatively few predators will be ready to pounce. The result is that we can gain a statistically significant edge on the most tedious, range-bound days. Everyone who has traded index futures has experienced such days: the market establishes a range in the first 30-90 minutes, then spends the rest of the day making fools of those who would attempt to second-guess, or “pick,” that range.
But what if you could initiate trades before a range had even been established – and at a price which to most other chartists would look like the middle of nowhere, so to speak? That is exactly what the Hidden Pivot System allows you to do, enabling you to exit the market with a fat profit before the competition has had a second cup of coffee.
The beauty of the system is that you don’t have to be a math whiz to master it. My Hidden Pivot rules are more visual than mathematical, and they can be applied to potent effect by anyone with the patience and diligence to monitor weekly, daily and intraday charts over time. Speaking as a “permabear,” I should mention that the system has been particularly useful to me, since it allows me to override my innate bearishness with mechanical objectivity. I am a bear’s bear by inclination. Armed with this system, however, I am perfectly comfortable being a raging bull when the signs are right. (Note: You’ll receive a Hidden Pivot calculator software program with your course materials.)
How It Works
How does the system work? To start with, I always try to visualize the price movement of stocks, commodities, options and indexes in the perspective of an ABCD pattern such as the one shown above. Unlike Elliott Wave Theory, which is rooted in trend patterns with five legs and corrections with three, my method distills all of the action down to three legs. It also sidesteps the often daunting task of distinguishing corrections from trend moves. Those who are familiar with Elliott Wave Theory know that even EWT experts sometimes bog down in the choppy seas of corrective patterns. Terms such as expanded flats, extended or truncated fifths, double and triple threes, zigzags, and contracting, ascending and descending triangles are all part of Elliott Wave terminology, and they must all be mastered by the chartist who would attempt to forecast accurately and profitably. However, Hidden Pivot strategies, on the other hand, shun such complexities, focusing instead on the most fundamental rhythms of the market. If you can distinguish good art from bad, you can learn the Hidden Pivot Method.
So how do I keep from getting fooled or confused by corrective patterns? Simply by treating them, not as corrections, but as ABCD patterns unto themselves. Remember, I said that all price action can be reckoned in ABCD terms. This means that the B-C leg of the pattern above can itself be divided into an abcd structure, as follows:
The subdivision yields no crucial information per se, but if one applies a simple test to the abcd pattern, specifically to its c-d leg, he will be rewarded with a cornucopia of tradable information. For example, if the midpoint of the c-d leg is hit precisely and a rally ensues, you can be confident the rally will reach the ‘D’ target of the larger pattern just as precisely. This rule, as well as many others that are equally useful, are discussed regularly in my newsletter, Rick’s Picks, with charts to illustrate.
Trident’s Inventor
Ironically, the originator of the system never completely understood how powerful it was. The Trident System was developed in the early 1970s by a man named Charles Lindsay, who marketed it in seminar form with Larry Williams, commodity trader extraordinaire. The seminar had an unusual marketing gimmick: Students could pay the hefty tuition fee out of trading profits. No profits, no fee. Trident is still available in book form from Windsor Publishing, but its rudiments can be encompassed in a single chart:
The crux of Lindsay’s method was to wait for an AB impulse leg to form; then, after a BC pullback into a rule-based “window,” the trader would initiate a position exactly 25% (point ‘X’) along a follow-through leg that one presumed would eventually equal AB in points. After entering, the trader would to place a stop-loss just below point ‘C’.
An Obvious Weakness
One obvious weakness of this system is that it limits itself to just a single entry point along the entire length and breadth of the ABCD pattern. In the chart above, assuming it is of daily-bar magnitude, that could mean two or three week of waiting for one good entry opportunity. Another problem is that point ‘X’ is intuitively too obvious – a grazing spot where you and just about every other trader will instinctually be waiting to get long. Think about it. If you were looking to trade a stock and it suddenly shot up, producing a nice, robust AB impulse leg like the one in the illustration above, you would probably be thinking, “Geez, that was one heckuva rally I missed.” Still game to trade, you’d hope for a pullback – one that presumably would provide a comfortable spot to enter. Of course, you’d be nervous about buying the stock while it was still falling, so you’d look for a sign that the correction had ended. What better sign than a nascent uptrend? Typically, the comfort zone for buying this rally belatedly would occur somewhere around point X. Am I right? If you’ve ever traded stocks or commodities, you can understand why, in the midst of the picture-perfect rally described by the chart, jumping aboard at or near point X would feel entirely natural.
Then, as we know all too well, XYZ shares will fall just far enough to stop the herd out somewhere below point C. The stock will then turn sharply higher, and it’ll be “off to the races!” So how do we take advantage of this lovely pattern without getting burned? Recall what I said earlier, that Ira and I discarded Lindsay’s core principal, focusing on its far more useful corollaries. Specifically, we tossed out the notion that only point X works as an entry spot. By watching this pattern play out many thousands of times on the one-, five-, and fifteen-minute bar charts, we were able to determine more than a dozen additional entry points, both long and short, along the path of ABCD.
In the chart below, this implies you would get long at A; short at B; long at C; even longer at X; take partial profits at P; and exit at D — or even reverse the position by shorting at D.
The system would be a winner if it merely yielded the microscopically accurate swing points that it does. But in fact it can do much more. An especially powerful feature of the system is that it can determine at all times which trend is dominant – up or down. By observing price action at the midpoint of follow-through legs (i.e., along ‘cd’), one can predict with confidence, precision and consistency the continuation of trends, or, alternatively, their termination.
Hidden Pivots and Risk Control
Veteran traders are wont to say that “the trend is your friend,” insisting that no system which trades against the trend, as this one appears to do, can make money consistently. I like to reply simply that we are not trading against the trend; rather, we are initiating positions at the very first tick of new trends. Indeed, the system is so accurate that bids must often be placed a tick above or below tradable swing points, since buying or shorting at the actual pivot risks missing the trade because of liquidity problems.
I usually refer to these swing points as “hidden pivots” because they are not on the radar screens of conventional chartists. In practice, I do not usually initiate trades at hidden pivots that are coincident with support and resistance lines, trendlines, Fibonaccis and other price points that are widely observed and likely to be well anticipated. It’s always a thrill to catch a ride at a reversal point that has obviously caught the crowd unawares. And what better way to start the day than with a profitable trade executed amidst what most traders would describe as opening-hour chaos? This system not only makes it possible to do so, it also allows rigorous control of risk to a degree that is all but impossible to achieve with other methods.
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Accolades
Read what subscribers have to say about Rick Ackerman and their Rick’s Picks subscription experiences:
Regardless of what I achieve trading-wise in the future I will always consider Rick Ackerman the person that taught me to be a trader.
Paul Coghlan
Stock market analyst using Hidden Pivot strategies and analysis
Ricks daily recommendations are spot on and his complete dedication to his clients success is 24/7. His “Hidden Pivot” analysis nails the ebbs and flows of virtually any market to the nth degree. He teaches several techniques for exploiting these targets to maximum profitability and my favorite is “bottom fishing” which through a combination of the minutest stop loss and pin point accuracy produces astonishing results. It literally has to be seen to be believed and I would encourage others to confirm what I am saying by taking his free trial. I didn’t regret it and I doubt you will.
RoadRunr – Alpha Judge Reviewer
Technical options trader using Hidden Pivot strategies and analysis
As a retired CTA I have never seen anything as prescient as your Black Box Forecasts. It’s like having a crystal ball. On my very first trade with you (September 14), the long bond had closed at 112.28. You advised that they would sink to ‘exactly 112.16.’ Your instructions were to bid 112.17, risk just eight ticks, and then to hold to a 113.17 objective. I entered the entire trade before the open, and like magic the low was hit shortly after the open at exactly 112.16, and, incredibly, the market rallied through 113.17 for a clean $1,000 profit per contract! Black Box Forecasts is simply black magic, and I particularly admire your patience and discipline to only offer trades whose projected profits are four times greater than the money risked. With odds like that you provide a money management, risk/reward discipline that is unrivaled.
Scott Reeves
Retired options technical analyst
An axiom in every trading scheme is the importance of cutting losses. I shorted AOL, but covered when Black Box Forecasts predicted (correctly) it was headed at least 25 points higher. Cutting my loss was painful but nothing like it would have been had I been forced to cover in the subsequent run-up. I am a believer!
Carl G.
Retired Stanford professor and technical options trader Hidden Pivot strategies and analysis
We have really enjoyed your work. It is the consensus on our trading desks that it is important to have numbers that mean something instead of global ranges because our job is to make each desk profitable. The only way to do that is by good, effective, money management and certainly your pivot and target areas are very helpful. We find your S&P work to be most outstanding.
Robert Stehlik
Trading professionals, StarWorks
Hi, Rick. Just a short note to let you know that I bought an S&P 500 call option last week on your advice and sold it Friday for a $2,625 profit. I had never held an option right up to expiration before, but it was exciting and profitable. Keep them coming, and thanks!
Earl Degner
Techncial options trader using Hidden Pivot strategies and analysis
Since I subscribed to Black Box Forecasts, it has hit nearly every important turning point with a degree of accuracy that puts other forecasters to shame. I’m not only talking about stock prices, but about futures and indexes as well. You can practically trade the S&P and bond futures on autopilot. Your numbers are that good.
Tim Halikas
Pacific Coast market maker
Rick Ackerman’s daily forecasts are superior to that of any other technical data I have seen. In particular, I have found the bond and S&P analysis to be extremely reliable, in addition to the individual securities.
John P. Morgan
Professional technical options trader using Hidden Pivot strategies and analysis
Rick, you are a genius. Gold had one of its biggest swings today in 20 years, and you nailed both the exact high and low by within a total of less than one point.
Stan R.
Technical options trader using Hidden Pivot strategies and analysis
Before saying anything about Rick’s stock recommendations, I would like to share a little about his credentials. As per the site he was a market maker at the Pacific Coast Exchange for twelve years. There he helped FBI caught a rogue trader from Merrill Lynch. The trader stuffed rat poison in the containers of drugs from Smith-Kline and tipped news stations about the poisoned drugs supplied by the company. Simultaneously, he was betting on the fall of Smith-Kline’s share price by holding substantial put options position. When the news of poison laced drugs was aired, the share price tanked. Rick smelled a rat and started enquiring if a substantial short bet against the share had been made before the news spread. When he came to know about the trader, he informed FBI and the trader was eventually caught. Now you can wonder why I mentioned the story. The purpose is to highlight one point, Rick’s ability to identify clues which an average guy would never be able to detect.
Let’s start with his site. On the face of it, it looks simple and free of any marketing gimmick. Go to the ‘About’ section and you will have clear idea what you can expect from him. When you enter the site, you will be greeted with some analytical material and a few free recommendations. The articles show his genuine understanding of macro-economic and political issues and their possible consequences. His writings also show his ability to clearly articulate his views and keep the readers engaged. So the first impression is positive.
The services on offer are daily newsletters and intraday tips along with detailed strategies. Rick’s special focus is on derivatives and precious metals. His major tool of stock price forecasts is ‘Hidden Pivot’ which identifies the price inflection point not identifiable with traditional technical indicators. The best part is he provides all the advices, including entry and exit points, stop losses and regular updates. The membership fees are reasonable at $49 per month, $106 per quarter, $200 half yearly and $350 annually. He offers a two week free trial offer too.
He also offers a training session on mastering ‘Hidden Pivot’ method which comes at a relatively high $990. I found this expensive. But his recommendations work. So, if the course fee looks high, the normal subscription can be a cheaper substitute as ultimately you are working on his understanding of price trend and will end up with similar conclusion when using techniques taught by him.
Over all the efforts look genuine as you have transparency. Also you will hardly find any negative review from anybody about rick. I think you will not feel disappointed, at least with the free trial.
KnotFlea – Alpha Judge Reviewer
Technical options trader using Hidden Pivot strategies
I had $24,500.00 in my IRA and I now have about $34,500.00 ! What can I say? I’m amazed by your uncanny ability to see stock moves. To put it simply, ‘Boy, I’m glad you’re on my side’!
Mike Boschma
Retail technical options trader Hidden Pivot strategies and analysis
I have found Rick’s technical analysis to be extremely reliable. His dedication to subscribers is unsurpassed by any other charting service. Furthermore, he writers in a concise, unwavering manner that cannot be misconstrued. His commentary is a must for any macro investor.
Al Grigoletto
Professional technical options trader using Hidden Pivot strategies and analysis
I’ve been a full-time trader for 3 years, have used many newsletters, Internet sites, and even developed a screening application. The information gained was at best hit or miss. Then I came across Black Box Forecasts and became a subscriber. Rick’s uncanny ability to hit price points intraday and longer term have helped me develop trading methods as agressively as I deem prudent. Using Black Box Forecasts as a trading tool has been very profitable. I would recommend the newsletter to any active trader.
Craig B. Flood
Retail technical options trader using Hidden Pivot strategies and analysis
I appreciate you sending me the last 3 days of your newsletter to sample. After checking the results, it makes me more confident of the decision to subscribe to your newsletter. Your accuracy is unspeakable.
Ken T.
Retail technical options trader using Hidden Pivot strategies
Black Box Forecasts has been the most accurate trading guide that I have used. By and far, it has outperformed all other services combined. I recommend it highly.
Martin Fiterman, Principal
Protective Group Securities
One aspect which separates Rick from other market timers is his method of defining precise objectives for stocks as opposed to target ranges. His long-term call on the Japanese Yen bear market was particularly accurate. The discipline that Rick applies to his approach allows him to set aside biases and focus on what his numbers are telling him. As a result, he tends to catch trends early, before they are recognized by the broader public. I give Rick Ackerman a high recommendation as a writer and a technical market analysis.
Sean Lamb, Associate
Porter Capital Management
During the year that I was trading on the PSE floor, Black Box Forecasts called virtually every top and bottom of importance in my primary stock, Newbridge Networks. It was really like having a crystal ball. I have never seen forecasts so accurate anywhere else.
Peter Napoli
Market maker using Hidden Pivot stocks and options strategies and analysis
I have subscribed to many market forecasters and, to be blunt, am down tens of thousands of dollars due to their advice. Then you came along with clear advice, tight stops and price forecasts that were accurate to within ticks. I have tracked you to ensure that your claim of 80% winners is real, and it is. There is also your great sense of humor, which, blended with the recommendations, helps me achieve the confidence level I need to trade successfully.
P. Coombs
Retail technical options trader using Hidden Pivot strategies and analysis
Black Box Forecasts hit more bullseyes than any other forecasting service that I’ve ever seen. I used the newsletter to get an edge as an options market maker. I wish I had been trading his futures recommendations at the same time, because their accuracy in bonds, the S&Ps and the yen was even more amazing than the stock forecasts. He almost never missed a call, and very often predicted intraday tops and bottoms on the S&Ps correctly to within a tick or two. Even major turning points have been called to within just a few ticks of where they actually occurred.
Steve Murr
Former market maker using Hidden Pivot options strategies and analysis
I enjoy your colorful commentary and disciplined trading approach very much. Thanks again!
J.Q.
Retail technical options trader using Hidden Pivot strategies and analysis
I am a very youthful 69 years old, with a Series 7 license, and had never traded options seriously until I signed on with Black Box Forecasts. My experience before you resulted in a small loss overall, but so far all my positions from your recommendations are on the plus side. Most recently, acting on your advice, I bought six America Online calls for an average of about $60 apiece and just sold them for ten times that a $3,600 gain.
Joe Oliveto
Retail technical options trader using Hidden Pivot strategies and analysis
I’ve been trading very sporadically off and on since around 1990 but never made any money until I started using your recommendations. The four calls that I recently bought on your say-so for $200 produced an $1,825 profit in just a couple of weeks. Thanks for helping me do it without losing any sleep!
Sam Cabahug
Retail technical options trader using Hidden Pivot strategies and analysis
I am finally having fun with options and sleeping at night! Thanks for your help.
John Pollock
Retail technical options trader using Hidden Pivot strategies and analysis
I am one who, two days in a row, profited from your 10575 projection on the DJIA futures. I greatly appreciate your turning points. Even if I don’t use them exactly, they give me a ‘heads-up’ for determining entry points.
Charles Bernhardt
Retail technical options trader using Hidden Pivot strategies and analysis
As a brand new customer, I am ‘two for two’ with your recommendations. I got into AOL calls at 3/8, and sold 1 at 3, 1 at 6, and 2 at 9. I also bought Intel calls at 1 7/8 and took profits at 3 7/8.
William Jackson
Retail technical options trader using Hidden Pivot strategies and analysis
I am a relatively new and already very satisfied subscriber. Your last recommendation netted me a $4,200 profit on an initial investment of about $1,400, and although I could have made an additional $2,400 if I had held to your target, the results were certainly no disappoinment. I thank you for this trade, and the ones that I’m sure will come in the future. You have a subscriber for life.
Benedict Woo
Retail technical options trader using Hidden Pivot strategies and analysis
As a new subscriber, my first trade based on your advice produced a 466% gain on 30 call options. I’m not a day trader, but look for moves that are from 2 to 3 days to 2 to 3 weeks in duration. For your information, I have over 30 years of investment background as a research analysis, portfolio manager and market technician. I’m semi-retired but love what I’m doing and am still active in the market, but on my terms. I am also an advisor to a mid-size money management firm, managing close to $10 million and trading my own account, all from my home.
John S. Gardner
Retired investment advisor and technical options trader using Hidden Pivot strategies and analysis
Great call! It looks like your last recommendation is going to produce a profit of about 1400% for me a $4,000 gain on just $300 risked for a few call options. I am a novice with little capita, and only able to trade puts and calls via Schwab. Thanks for helping to make it possible.
W. MacLean
Retail technical options trader using Hidden Pivot strategies and analysis
Rick, you are the man! I am and individual trader who has subscribed to your newsletter for two years. I have made more money with Black Box Forecasts than with any other of the myriad of services I have used combined. Thank you very much! I do not always trade exactly as you suggest, but your guidance is invaluable and is flexible enough to allow me to make trades that deviate from the ‘program’.
Michael Purdue
Retail technical options trader using Hidden Pivot strategies and analysis and analysis
I purchased 1,700 shares of Cisco at 83 9/15 and 1500 more at 87 5/16. So far, up over $13,000 in this trade since 11/15, thanks to your assist.
Russell Bennett
Retail technical options trader using Hidden Pivot strategies and analysis
I hope you keep yen futures on your list. Year-to-date, I have made over $5,000 on the yen based on your advice. While I have improvised and stayed with some positions longer than you have recommended, your coverage has been quite accurate.
Bill Dabbs
Retail technical options trader using Hidden Pivot strategies
Have followed you for over a year now, I’ve learned a lot from your writings. Thank you. I Made a nice 36% gain on Goldcorp at 18.10 a day after you sold.
B.L. Edwards
Retail technical options trader using Hidden Pivot strategies and analysis
Congratulations on your new service! I can’t wait to be a paid subscriber. You are one of the favorites I’ve culled from two years of internet reading, both free and paid subscriptions. I won’t bore you with more praise just happy I only lost you for a day.
Karen Ramsey
At-home technical options trader using Hidden Pivot strategies and analysis
I’m a former P-Coast specialist who has been following you over the last several months. I and another P-Coast specialist are very impressed with your work.
Mike O’Neil
Technical options trading professional using Hidden Pivot strategies and analysis
I am an American who lives in Bali and am presently in Singapore. I trade gold stocks, where things move fast. I have tried Schultz, Kern, Droke – and you are the best, pal. Clear, easy, no long-winded pontificating or ambiguous garble (‘Well, this is gonna happen, unless of course this other thing happens instead’). Just good, straighforward info is what you provide.
Jack Blaylock
Gold-stock trader using Hidden Pivot strategies and analysis
I just had to write cause I’ve been reading your stuff for about three years after I accidently stumbled upon the precious metals markets and 321gold. I read you today and I really had to tell you that this is some top-notch analysis and writing. You are in danger of returning to my daily, crowded, obsessive, can’t-get-off-the-damn-internet, reading. Thanks, and kudos on your new service.
Paula M.
Retail technical options trader using Hidden Pivot strategies and analysis