Silver stalled Friday precisely at the 29.00 midpoint of the bullish pattern shown. My gut feeling is that it will finish the week above this Hidden Pivot resistance, presumably bound for at least p2=30.37, and thence D=31.75. These are relatively modest targets in comparison to longer-term charts that show upside potential to 36.03 and higher, but we'll take them one at a time, the better to keep risk under tight control as we augment and hedge positions on the way up. If you're keen on trading this vehicle, please be vocal about it in the chat room.
Last week's tedium left July Silver with somewhat further to fall before sellers are likely to exhaust themselves. Specifically, the futures will need to come down to at least 25.90 for that to happen. This appears likely due to the way the downtrend crushed the midpoint Hidden Pivot support at 28.045 the first time sellers encountered it following mid-April's 30.19 peak. There are no easy hooks for determining a trigger interval to bottom-fish, so we may have to calculate it in real time if and when the target is hit. Stay tuned to the chat room and your email Notifications if you care..
July Silver's weekly chart allows room for a 34% rally to 36.96. In order to extrapolate a comparable move in gold, we need the help of an extremely gnarly pattern on the continuous monthly chart that projects a 28% rally to 2995.00 (A= 681.00 on 10/31/08, B=2063 on 8/31/20). More immediately, July Silver's correction from the 30.19 high recorded on April 12 appears bound for a minimum 25.90. (This would imply that gold's correction has further to go.) The provenance of this target is shown in the thumbnail chart. The decisive downside breach of the rABC pattern's midpoint pivot (28.04) implies not only that D=25.90 will be reached, but that an intervening rally to x=29.12 would offer a tempting opportunity to get short 'mechanically'.
The way sellers crushed p=22.92 on June 21 leaves little room for optimism that this correction will somehow avoid falling all the way down to the 21.21 target of the pattern shown. In fact, even a strong rally to the green line (x=23.77) would set up a 'mechanical' short that we should not pass up. The pattern meets all of our requirements for legitimacy but is perhaps a tad too obvious to produce a tradeable low at exactly 21.21. We'll attempt to bottom-fish there nonetheless if and when the time comes, but with a 'camouflage' trigger that allows for some skirmishing ahead of the expected turn. We'll also need to consider an alternative target at 20.98 that would result from treating the somewhat higher 'A' at 26.43 (May 5) as a one-off peak. _______ UPDATE (July 3, 5:55 p.m.): The equivalent downside target for the September contract is 21.44, and a rally to 23.98 would trip a mechanical' short.
With 'Doc' Copper tiptoeing higher, we should prepare for a possible opportunity to short the July contract 'mechanically' if and when the futures get to the green line (x=4.026). The week ended on a downstroke that would require a last-gasp rally to reach our goal. This is a potential $65,000 winner on four contracts, with commensurate entry risk, so we would want to initiate the trade with a 'camouflage' trigger capable of drastically shrinking the initial exposure. I have no indication that subscribers trade this vehicle, but please let me know in the chat room if you're interested. _______ UPDATE (Jun 28, 5:56 p.m.): The shorting opportunity is past, since the futures have sold off hard since narrowly missing our offer. The 2.956 downside target noted here earlier remains in play.
July Silver caught a bounce from the 22.06 secondary Hidden Pivot last week, but that won't save it from a further fall to the 21.205 target shown in the chart (inset). That much is clear from Wednesday's crushing breach of p=22.91. The pattern looks too obvious to deliver a precise bounce, but a tradeable turn from very near the target seems unavoidable. So far, the 'natural' trigger interval on a reverse-pattern entry would be 25 cents, but we'll look for alternative ways to get aboard (i.e., 'camouflage'), since the implied entry risk on four contracts would be around $5,000.
The rally from May 26's 22.78 low would become an enticing 'mechanical' short if it touches the green line (x=25.19), as seems likely. Initial risk would be a little more than $4000 per contract, so the trade is recommended only to those of you who know how to cut that by at least 90% using a 'camouflage' trigger. If there is sufficient interest in the chat room, I will provide guidance in real time. We would be shooting not for a drop to 'D', but for a single-level profit predicated on exiting at p=23.946. A fall to D=21.46 would still be a theoretical possibility, however. ______ UPDATE (Jun 16): Yet another week of excruciating tedium told us nothing we didn't know a month ago. Even the crime syndicate that manipulates bullion futures seems too bored to bother. The analysis above can stand as given.
Silver looks likely to fall to a D target at 21.46 that's equivalent to one in gold that seems somewhat out of reach. On balance, I lean toward a bearish resolution, but we'll monitor this symbol closely in any case. A rally to the green line (x=25.19) would trigger an enticing 'mechanical' short, but because the entry risk would be more than $6000 per contract, we should plan on doing the trade with a camouflage trigger that can cut that to $600 or less. If the futures instead fall, bottom-fishing at D would be attractive, although the pattern looks too obvious to deliver a precise low at the Hidden Pivot.
July Copper's breach in late May of the 3.65 midpoint Hidden Pivot support shown (see inset) is bearish and hints of a further drop to as low as D=2.95. A corrective rally to the green line (x=4.00) would set up an opportune 'mechanical' short, but failing that, the most promising swing trade we could envision on the middle horizon would be bottom-fishing at p2=3.30. If that were to occur, the energy sector would undoubtedly experience a corresponding drop that in turn would imply an easing of inflationary pressures and a positive impact on mining stocks. Please note that this is 'Doc' Copper's first appearance on the touts list in a very long time, and it is intended to supplement and confirm my analysis of crude, which is also in a secular downtrend.
It's been a while since I updated this mudder, but it tripped a textbook 'mechanical' buy last week that would have been easy money for any Pivoteer who was watching. The signal came on Wednesday at the green line of a corrective pattern projecting to as high as 80.05. The nascent uptrend bears watching, since it would spoil the possibility of gasoline prices for regular gasoline falling below $3 a gallon across much of the country. More likely in my estimation would be a relapse to below C=63.91 of the reverse pattern shown. ______ UPDATE (Jun 16): Since May 4, July Crude's meaningless ups and downs have triggered no fewer than three 'mechanical' buy signals on the daily chart, each worth a little more than $16,000 on four contracts. Are you beginning to see that it's all just a big, sleazy carnival game, but with players who are not missing four or five teeth? ______ UPDATE (Jun 23): Yet another $16,000 mechanical winner came home on Friday, even as the futures continue to screw the pooch with meaningless ups and downs.
