August

The sharp rally off the July 6 low at 95.10 does not appear bound for greatness.  Although I still have a lofty outstanding target at 134.59, I've grown increasingly skeptical that it will be achieved. It has yet to be negated by a dip below C=86.81, but evidence grows that the bullish pattern is weakening nonetheless. Last week, for instance, we saw a corrective ABCD complete to its D target at 94.70. If the larger and still theoretically dominant, bull-market were as robust as its initial A-B impulse leg, the correction should not have exceeded p=104.38 (the red line in the chart).  My hunch is that, barring an unforeseeable geopolitical shock to global supply, the June 14 top will stand and that this rally should be shorted. Stay tuned to the chat room and email 'Notifications' if you care. ______ UPDATE (Jul 12, 5:18 p.m.): Bombs away! I am projecting $3.00 more downside before August Crude becomes an appealing speculative buy. ______ UPDATE (Jul 13, 9:40 p.m.): The futures have bounced after bottoming $1 above where I'd predicted. The rally shows promise, but it would need to surpass an external peak at 111.46 to merit our serious attention. Getting short (or long, for  that matter) will be tricky, so 'camouflage' is advised. ________ UPDATE (Jul 14, 9:57 a.m.): Someone asked in the chat room where I thought crude was headed. I responded as follows: $40 a barrel or lower-- just a hunch. But if you are addicted to bottom-fishing, the most promising place to try it would be 88.90 (basis the August). That's my minimum downside target for the near term, and I am confident it will be reached. The pattern is too obvious for precision, since the mouth-breathers and algos will be out in force trying to exploit it, so camouflage is

August Gold finally turned higher on the final bar of the week, a suspicious development from which some in the chat room seemed inclined nonetheless to take encouragement. My take is more skeptical, given the way sellers cracked the midpoint Hidden Pivot support at 1794.90 a week earlier. It suggested that the futures are likely to reach 'D' before they can make a good-faith attempt to end the long dirge begun from $2000  in April. Please note the small adjustment in the chart -- a shift to a higher point 'A' that has lowered the target by a few dollars to 1707.20.  Note as well that a two-level rally to x=1888.70 would set up a 'mechanical' short of a kind that has worked well for us in the past. _____ UPDATE (Jul 12, 5:38 p.m.): Chat room remonstrations have sought equal time for predictions of a 1670 low before this cinder block can turn around, so here it is: a 1665.00 Hidden Pivot target. Certainly not impossible, but I will be looking for a tradeable and potentially important turn from higher levels nonetheless. Specifically, I expect the futures to bounce from 1718.30, and thence from 1707.20 if there's a relapse. If 1707.20 is exceeded on a closing basis for two consecutive days, however, or exceeded by more than $4 intraday, I would infer that 1670 is indeed going to be reached (and slightly exceeded).  That would be a great place to back up the truck and buy 'em hand-over-fist.

Sellers ran out of steam precisely at the 104.42 target shown in the chart. This implies the so-far one-day bounce could travel a bit farther or even get legs, since the pattern took fully two weeks to play out. I'd proffered a 105.52 downside target initially, but when it was somewhat exceeded, a new target was warranted. The one in the chart was calculated simply by sliding 'A' up a notch above the original one-off. Now, if the uptrend exceeds c=114.05 of the reverse pattern, we should infer 116.29 as a target.  Here is the chart from which it is derived. Please note that one coordinate was slightly off and that the corrected target, as implied above, is 116.29, with p=110.43. (I have not corrected the actual chart.) _______ UPDATE (Jul 5, 9:21 a.m.): Last night's vicious little head-fake above p=110.82 reminds me of NatGas, which is always out to cripple and maim those who are capable of getting the trend and the swings right consistently. In retrospect, and in this particular instance, this behavior justifies using an ABCD pattern anchored at 101.53, a 'marquee' low. It yields a D target at 117.08 that is about to become moot with a presumptive feint below C=104.56.  Incidentally, I am not buying into the bullish story that the resurgence of China's manufacturing sector is about to drive energy prices to the moon. _______ UPDATE (Jul 6, 8:16 p.m.): We used this pattern to trade a 94.70 downside target.  Given the precise hit at p and its subsequent destruction, I cannot fathom why the target was not achieved within three pennies or less. Perhaps one last swoon is needed to finish the job? ______ UPDATE (Jul 7, 6:02 p.m.): Evidently not. The futures went ballistic today off yesterday's 95.10 low, and that's pretty bullish. 

I've been so down on gold lately that I should probably recuse myself, but here we go anyway: The trampoline rally off Friday's heavily manipulated low is likely bound for at least 1828.80, the D target of the reverse pattern shown. It is not quite a done deal because of the hesitation at p. That's why bulls should be careful if and when the move hits p2=1817.30, where a tradeable reversal could occur. Meanwhile it would take a print exceeding 1882.50 to negate the 1756.90 downside target that has been in play for nearly a month. ______ UPDATE (Jul 5, 11:20 a.m. EDT): So much for giving gold the benefit of the doubt. Today's freefall looks bound for D=1746.30, a back-up-the-truck spot for bottom fishing as far as I'm concerned. Here's the chart, with a pattern that caught a beautiful mechanical short just head of what eventually will have been a $136 selloff.  _______ UPDATE (Jul 6, 8:06 p.m.): We're now working on a 1710.00 target, although the bearish forecast did not prevent our exploiting a mid-day rally worth as much as $2300 to anyone who followed my 11:43 a.m. Trading Room 'rABC' guidance. (It also went out in timely fashion to all subscribers in the form of a 'Notification'.))))))))))))) 

Crude ended the week with an unimpressive rally that exceeded no prior peaks. Accordingly, I'll suggest sticking with our plan to wait for a pullback to x= 98.84 (the green line) before we do any buying. Since the by-the-book stop-loss at 86.88 equates to entry risk of nearly $12,000 per contract, we'll need to initiate the trade using a 'camouflage' set-up on the very lesser charts. There are no guarantees the required pullback will occur, but I'll post alternative ideas for getting long only if chat-roomers demonstrate keen interest. _______ UPDATE (Jun 28, 8:10 p.m. EDT): This chart, with a 113.47 rally target, is the least bullish picture I can draw at the moment.  Why so cautious? I am bearish on the global economy is why, particularly China's manufacturing sector, which sets oil prices at the margin. Yes, an exogenous geopolitical shock could send quotes soaring, and we must always be ready to concede that that's possible. It would become a likelihood in my view if the August contract were to blow past 113.47. This squares with my view that market trends and price action determine the news, or at least our perception of the news, rather than the other way around.  Whatever happens, the 'conservative' rally pattern I've drawn cannot but tell us whether the uptrend is just getting warned up. If the futures close above 113.47, I'd infer they were bound for a minimum 116.70, or even 121.75 if the lower resistance gives way. That target was calculated by sliding 'A' down to the May 19 low at 100.66, turning a reverse pattern into a conventional one. ______ UPDATE (Jun 29, 6:34 p.m.): Crude means to fool us with psychopathic behavior, but it's all just impulse legs, isn't it? The futures retreated sharply after exceeding the 113.47 target by

Gold remains a study in disappointment and tedium. We've focused on a too-obvious pattern with a bearish target at 1756.90, and even shorted it on paper at 1851.20,  but with no great expectation of the futures getting there. Nor are they likely to achieve the very bullish, 2082 target of a much larger pattern any time soon. If you'd prefer to trade this vehicle nonetheless, try bottom-fishing in the range 1787-1792 with a 'camouflage' set-up using a chart of five-minute degree or less. _______ UPDATE (Jul 1, 9:27 a.m.): The futures are in a presumably meaningless bounce from 1783.40. That's below my bottom-fishing range, which was tied to a p2 'secondary pivot' at 1788.30.  The $6 overshoot is sufficient for us to presume that the next leg down, if and when it comes., will be an even-odds bet to reach the worst-case, 1756.90 target. Ray-rah-sis-boom-bah, Gold! You go, girl!

I'd suggested paper-trading the 'mechanical' short at 1851.10 that triggered last Thursday, but the point of the exercise was to underscore my advice that any rally not be taken too seriously. This one came off a low at 1806.10 hit on Tuesday, and the trade became theoretically profitable the next day with a so-far moderate reversal. The price target is 1756.9o, a Hidden Pivot support that can serve as a worst-case objective for the next 7-10 days. _______ UPDATE (Jun 22, 9:20 p.m.): Gold's price action can be best understood if you see it as a Bill Cosby girlfriends, unwittingly drugged and in a deep stupor.

This will come as scant consolation to long-term investors who have suffered through three months of corrective pain and tedium, but the recent low failed to generate a bearish impulse leg on the weekly chart (see inset). It could still happen, but the implication of a second try would be that bears don't have the conviction to crack 1700. Whatever happens, bullion is just a trade at the moment and nothing more, with a time horizon of perhaps 2-5 days. _______ UPDATE (Jun 13, 10:13 p.m,): Here's a fresh chart with a 1773.70 downside target that is probably the best that bulls can hope for over the near term. A rally to x=1855.30 would trip an enticing 'mechanical' short, stop 1882.60, The trade is recommended for Pivoteers who are proficient with 'camouflage' triggers, since the initial risk on four contracts would be around $12,000 theoretical. ______ UPDATE (Jun 16, 10:32 p.m.): The rally tripped the 'mechanical' short noted above, but I am still recommending the trade only to subscribers proficient with 'camouflage' set-ups.

The chart implies that I am cautiously bullish, but that's a small exaggeration. The recent dip below 1800 seems to have exhausted sellers for the time being. However,  bulls, such as they are, appear to lack the energy or enthusiasm for turning things around.  For starters, they would need to surpass early May's 1917.60 peak to generate a bullish impulse leg on the daily chart. In the meantime, there's no point getting excited about gold's prospects until this happens. A relapse that breaches the 1792.00 low would have very bearish implications. Alternatively, if gold shocks with a powerful rally that blows up p=1937.20, we could justifiably take an earnest interest in the 2082.30 target, which is theoretically in play because the green line has been touched.