June

Traders spent the entire week screwing the pooch, demonstrating that bulls and bears are equally clueless at the moment. It suggests that the coming bear rally will likely be a tedious affair, about as much fun to watch as the 1893 New Orleans matchup between two determined lightweight boxers, Andy Bowen and Jack Burke. It went 110 rounds before the ref mercifully called it a draw. Will the SEC step in and freeze stocks at a permanently high plateau? My hunch is that the longer this slugfest lasts, the more likely the broad averages will make marginal new highs before a full-blown, take-no-prisoners bear emerges. More immediately, however, you should use 5845.75, the Hidden Pivot target shown in the chart (inset), as a minimum upside objective when the new week begins. It will remain viable as long as traders, entranced by Wall Street's fun-house mirror, don't stop themselves out with a stupid, pointless feint beneath last week's 5650.75 low.

Friday's 101-point thrust came within less than a point of fulfilling the 5649.50 target I'd flagged in the chat room an hour before the day began. I'd said it would take much more than that to produce a bear rally worthy of the name.  How much more?  Probably another 300 points before bears who have bet the 'don't' line would start feeling queasy. The sassy little pisher that capped the week didn't surpass a single distinctive peak. Still, that's how all memorable bear rallies begin, greeted with skepticism the moment they bolt from the gate.  Let's see if short-covering bears have the energy to lift this brick above 3/12's 5675.00 peak as the new week begins. Expect this to happen earlier in the session if at all, since that is when the sleazeball who control the game have the most control over the order book. _______ UPDATE (Mar 17, 12:53 p.m. EDT): The June contract's timid rally this morning just missed taking out a peak at 5726.75 equivalent to the one given above for the March futures. It will do so shortly, however, and will then face a more challenging and less obvious resistance at exactly 5740.25. That is the midpoint Hidden Pivot resistance of this pattern, which allows a bear rally to as high as 5920.50, a back-up-the-truck number for getting short.  You can try shorting 5740.25 as well, provided you can handle a 'camo' trigger on the lesser charts. Risk no more than 3.50 points on the initial stop-loss.

September Crude loitered for four days at a 76.26 Hidden Pivot correction target identified here earlier, then crushed it with a running dive that followed a vicious head-fake. The subsequent low occurred almost precisely at the too-obvious trendline shown. Since every oil trader in the galaxy will have used this feature to bottom-fish, it is unlikely to work precisely. However, sellers are going to have difficulty turning such a compelling 'structural' support to mush, so look for oil's so-far 12% slide to end hereabouts. _______ UPDATE (Aug 5, 12:35 p.m.): The slide did not end at the support. Is oil perhaps discounting the possibility that the stock market's plunge has set in motion an economic collapse?

Crude's so far $1.35 bounce from within 7 cents of the 76.26 target I'd flagged suggests the rally is likely to get legs, so don't be fooled if this vicious little sonofabitch fakes a low beneath Friday's 76.19 bottom before it takes off.  This could set up a 'counterintuitive' trigger for Pivoteers who are familiar with the technique, which is the forerunner of the reverse-pattern set-up. Since no forecast should be chiseled in stone, let's remain open to the possibility that the low will be broken decisively. If that occurs, assume DaBoy are fixing to crush quotes.

I still consider a pullback to x=5105 more likely than a move straightaway to D=5542. A subsequent rally to the target would not be a done deal, either, given the mild struggle bulls have had surmounting the midpoint Hidden Pivot's gravitational pull.  Impale it they did not, and that leaves the pattern's completion to D at least mildly in doubt.  We can still use p=5397 as a minimum upside objective, since that is the most logical place for this rally to stall.

Friday's nutty finale should remind us that the agent responsible for such behavior is none other than...ourselves. Lest you take the vicious, end-of-day short-squeeze too seriously, the thumbnail chart puts it in perspective. The futures have in fact rolled down without even reaching 5398, the p2 'secondary pivot of the still-bullish pattern shown. They are a better bet to fall to 5108.25 first than to reach D=5542.50 straightaway.  We'll be ready in any case, especially for a feint marginally above last week's record high at 5368.25. That was itself a slightly new all-time high, creating ideal conditions for a top of potentially diabolical cleverness.

Gold has repeatedly resolved double tops in favor of bulls for many years, but always differently. The current pair of peaks is tightly spaced, giving the impression of weighty distribution. The 2530.40 rally target on this continuous weekly chart is viable nonetheless, and there is no reason to presume it won't be reached. But that does not preclude a sharp pullback first to the red line (p2=2071.70). It makes a logical target if bulls are to be rebuked yet again for their steadfast belief in the quaint idea of gold's historical primacy as money.  For now, let's draw our inferences from the lesser charts of August Gold, which currently provide an easy path down to 2300-2320. ______ UPDATE (June 7, 12:15 p.m.): Gold has in fact followed an all-too-'easy path' south, to a so-far low today of 2320.20. That is the upper threshold of the corrective range I'd forecast. However, I'd be surprised if the futures did not take out May 3's 2308.70 low and then diddle 2300 just for good measure. 

The drubbing that gold received last week after having slightly exceeded the 2449 high from mid-April was a rude shock. It created a series of impulse legs on the hourly chart, even if it missed being impulsive on the daily chart by a mile. The most troubling aspect of May 20's false breakout is that the rally fell $34 shy of the 2588 target I'd identified earlier, a Hidden Pivot related to a chart of higher degree. This trend failure will have taken enough bulls by surprise to add the weight of their shock and disappointment to current selling. It points most immediately to a test of the 2285 low recorded on May 3, so let's make that our minimum downside objective for now.  It would take a print all the way down at 2170.70 to generate a bearish impulse leg on this chart, but that is a prospect we needn't worry about at the moment.

Although a swoon to the green line (x=5108) would set up an appealing opportunity to bottom-fish there 'mechanically', I now doubt that the implied bounce would reach D=5542. More likely is that it would fail at p=5253 or lower, creating a secondary top that would still be seductive enough to trap bulls and bears alike (the latter via a short squeeze).  There is another visually appealing possibility that rates equal mention: a feint next week to p2=5397, as suggested here earlier.  I will continue to monitor the lesser charts diligently for signs of one outcome or the other. If the swoon is coming soon, it will likely be signaled by the futures' failure to achieve 'D' rally targets of minor degree, and to overshoot minor 'd' corrective targets.