July

I've struggled to feign interest in crude, since it is hostage to geopolitical forces that taken together do not add up to anything whose meaning could be distilled for predictive purposes. There is scant interest in the chat room in trading this vehicle, although sometimes a subscriber will mention having used an ETF to leverage my targets. There's one at 56.90 that holds little practical value at the moment. Two 'mechanical' shorts performed well in recent months, but it is only on the weekly chart where the pain and sweat required to have made money on these swings is somewhat obscured. I'll keep it on the list because oil is the most important commodity of them all, but you'll need to nudge me if you have a trading idea you'd like vetted.

Although I've flagged a potential bottom-fishing trade in June Gold using 'mechanical' levels, July Silver would become a fetching 'mechanical' short if buyers push it up to the green line (x=25.19)  this week. The implied entry risk of $6200 per contract would warrant a trick-shot entry using a small reverse pattern, but that shouldn't present a problem for seasoned Pivoteers. Worst case over the next 2–3 weeks would be 21.460, although I doubt sellers have the moxie to accomplish something so dastardly.

Last week's plunge precisely to the red line, a midpoint Hidden Pivot support at 23.95, has validated the pattern and its 21.46 target. This is not necessarily as bearish as it sounds, since the futures will need to exceed p decisively, then close beneath it for at least two consecutive days, to imply they are bound for p2=22.704.  For now , however, they would become a spec buy using an rABC trigger, since the midpoint pivot is always a logical place for a price reversal. Please nudge me in the chat room at the appropriate time if you are interested. ______ UPDATE (May 16, 6:13 p.m.): Sinking, soon to drop off the edge.

The chart shown, with a downside target at 56.90, is one of the few I've presented here that actually might not be good enough for government work. The A-B impulse leg is one that only a mother could love, since its 'B' bottom surpassed no distinctive prior low.  On the other hand, no fewer than three kamikaze dives have reversed almost precisely from p and p2 Hidden Pivots. Regardless, the theme I have sounded here for nearly a month -- that the Saudi cutbacks amounted to a toothless threat -- has helped keep us on the right side of a downtrend that evidently knows a global recession when it sees one.

Silver loves to tease traders by tiptoeing up to old highs and lows, then reversing with sadistic brutality. You'd think the victims would have caught on by now, but if and when they do, the gremlins that animate this vehicle will have moved on to a different, equally nasty game. For all its histrionics, the ABCD pattern that has informed our bullishness for the last two weeks remained intact along with its 27.150 rally target. The futures already tripped a profitable 'mechanical' buy on a pullback a week ago to the green line, and it would trip another if it takes out Friday's low at the beginning of the week. That would amount to sloppy seconds, though, and so I will offer no guarantees.

July Silver has been in a so-far moderate correction of a top two weeks ago at 26.43 that we had precisely anticipated for the May contract. The corrective reverse pattern that I've drawn is probably more bearish than what we'll see, but it should still work for purposes of trading, forecasting and gauging trend strength. For now, you can use p=23.94 as a minimum downside objective. That Hidden Pivot support can be bottom-fished provided you are capable of limiting the risk tightly. A decisive penetration of p would shorten the odds of more weakness to D=21.46. _______ UPDATE (May 1, 10:03 a.m.): Scoundrels, lunatics and short-covering bears inadvertently teamed up before dawn to goose silver into a spasm that has turned the short-term picture bullish. The rally would become still moreso if and when it exceeds the 26.43 peak recorded on April 14. That would bring a 26.91 target into focus (60-min, A=24.26 on April 4).  _______ UPDATE (May 2, 7:38 a.m.): The futures just bounced from a voodoo number without having taken out the 24.735 'C' low of the bullish pattern shown in the current chart. They will need to hit 25.12, however, to suggest the rally has sticking power, and 25.36 to get out of trouble. _______ UPDATE (May 2, 6:30 p.m.): The futures easily exceeded my benchmarks (see above), setting up a possible run at the 26.43 peak recorded on April 14.

You just know that the scoundrels who rig the energy markets and who have transformed them into a flighty carnival game have gone clueless when your editor cannot find a good place to plant an 'A' high or low on a NYMEX chart.  Even so, we got the big picture right intuitively by not buying into the steep, fleeting rally that occurred after the Saudis took a pot-shot at Biden by ostentatiously cutting output. It is ultimately demand for crude that causes its price to rise, not the curtailment of supply. With the world economy sinking into stagflation-at-best, a surge in energy demand seems unlikely. Ordinarily, I rarely post a tout without putting a number in it that you can trade. In this case, however, I'll say that the July contract is just a trade and leave it at that. _______ UPDATE (May 2, 10:41 p.m.): Wheeee! Isn't this fun? It's probably time for another threatening PR release from the cartel that couldn't shoot straight.

Distrusting the hubris that accompanied Saudi Arabia's timid cutback on supply has paid off, since crude has relapsed as we might have expected. I've switched to an unambiguously bearish pattern that projects a drop to as low as D=66.86. We'll likely get to enjoy a ride down to at least p=74.89, where price action should tell us how much more weakness might remain. Let's keep our fingers crossed, since the last thing the country needs is gasoline prices pushing above $4 and staying there for a while.

Silver will need more rest after topping pennies from an important Hidden Pivot target at 26.20 target that I'd drum-rolled for the May contract. The corrective target at 24.80 shown may prove to be optimistic, but there's no harm in using it analytically, since its ability to contain sellers can tell us how much power is behind the downtrend. It has worked already for initiating a 'mechanical' short at the green line, and it can also be used to bottom-fish. Caution is advised, however, since the 'B' low of the pattern 'sausaged out' when it narrowly failed to impulse beneath the April 6 low at 24.91. ______ UPDATE (Apr 23, 6:00 p.m.): The 24.80 target worked nicely, getting within 7 cents of the low of a so-far 61-cent bounce. It seems likely to continue because the bounce overshot the 'd' target of a minor reverse pattern.