September Silver took a tentative bounce from the launcher last Thursday, but it will need to close above the pink line at 28.82 to be considered airborne. The reverse pattern shown is both compelling and obscure, so d=27.41 stood to work precisely. Is the reversal from 14 cents above that Hidden Pivot sufficiently precise to infer the downtrend is spent? Probably. But if the futures relapse this week, be ready to bottom-fish voodoo 27.05 with a trigger interval as tight as a dime. ______ UPDATE (Jul 29, 6:13 p.m.): The futures relapsed, all right, but only enough to get them even closer to my 27.41 target. Is the new low at 27.45 close enough? The question is no longer worth pondering, but you should be long if you used the suggested trigger interval, with a partial profit from the 60-cent move that has occurred so far.
Ordinarily, the failure of a downtrend to achieve a 'D' target should be read as a sign of incipient strength. In this case, however, the gap-down opening after GDXJ head-faked above p=45.95 implies that the target remains likely to be reached, notwithstanding the robust bouncce that has occurred so far. The midpoint Hidden Pivot is a speculative place to try aa 'mechanical' short in any event, so be ready to buy puts there if overly enthusiastic buyers goose this vehicle in the early going after Monday.
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.
Last week's correction has further to go before buyers could step in without risking much. A pullback to the green line (x=5422) would trigger a 'mechanical' buy, although there are no guarantees we'll be gifted with such a bargain price. More interestingly, neither can there be any guarantees that the next big rally will reach the 5881 target shown in the chart. Had the uptrend impaled p=5575 a month ago on the way up, a finishing stroke to 5881 would be more or less asssured. However, price action at p was muffled, and it took fully three weeks before buyers were able to push past it decisively. That is a cautionary sign, even in a bull market that has been as strong and steady as this one.
MSFT is falling after having slightly exceeded the 462.80 target shown. Ordinarily I would regard the overshoot as mildly bullish, but in this case the target was simply front-run by sellers eager to short an ABC pattern so obvious it could be seen from outer space. With all these clowns piling on, the short squeeze that occurred above the target should have been stronger. The implication is that the stock is falling on organic weakness and will need to correct stridently before it can turn around. Hidden Pivot levels aside, my guess is that the pullback will come down into the space defined by the two prior lows at, respectively, 388 an 404.
Bertie is a lock-up to reach the 69,161 target shown, but it will need to close for two consecutive weeks above 71,395 to put an 89,029 'D' target in play. It goes with this pattern, and it is the highest projection I've identified that is tied to Hidden Pivot levels. It is curious that bitcoin rose so sharply in a week that featured heavy selling in the S&Ps and the tech stocks. I can't imagine that the King of Cryptos would be considered a safe-haven asset, but if so, then perhaps the End of Times is nearer than we'd thought.
Three successive, marginally higher tops in the last three months have made this vehicle more than a little tiresome. The futures will need to come down to at least p=2352.00 of this latest, bullish pattern before we can get a confident read on how long the tedium might last before gold blasts off toward 3000. We might be able to determine trend strength accurately as early as Monday or Tuesday by looking at patterns going in either direction on the lesser charts, so stay tuned.
A full correction to the 27.41 'd' target shown would be a back-up-the- truck buying opportunity that could be initiated with a tight stop-loss. We should be alert to the possibility, however, that the retracement will fall somewhat shy of d before reversing. A logical 'fooler' spot for a reversal would be from near 28.11, the midway point between p2 and d. A second possibility would be a turn from around 27.72, midway between the last two prior lows. In any case, I expect sellers to bring the futures down below the 28.90 low from June 28 before a turnaround can occur.
Friday's decisive breach of the 45.95 midpoint support of the reverse pattern shown implies the correction is likely to hit d=42.78 before it ends. GDXJ did run back up to p at the close, but the fact that it still settled below this Hidden Pivot can only be read as a negative. A retracement rally to x=47.53 would generate a textbook mechanical short, so don't pass up the opportunity if it materializes. The 'd' target can be bottom-fished if and when GDXJ gets there, but the obviousness of the pattern, even though it's a reverse, will work against a precise turn.
Bears shouldn't get their hopes too high just because the S&P 500 plummeted for three straight days last week. The selloff seemed tightly scripted, given that the Dow Industrials were rising just as sharply at least part of that time. This is shown in the chart above, which captures price action on Thursday. The implication is that portfolio managers were simply shifting money from one simmering vat to another, an efficient way to keep stocks bubbling without expending much capital. Someday their ingenious siphon pump will be overwhelmed by honest-to-goodness selling. You'll know the weakness is real because it will last for three or more days, it will encompass all of the broad indexes, and it will gain in momentum. Three straight days of selling has been an extremely rare occurrence since this gaseous bull run began in March 2020, just before the covid hoax laid seige to the U.S. economy. But four days? You'd have to go back many years to find an instance of this. Lessons to Unlearn Even the 1987 crash didn't last for three full days. It began on the afternoon of Friday, October 16, but by mid-morning on Tuesday, October 19, selling had dried up and stocks were poised to come roaring back. Bears who were slow to cover short positions got savaged almost as badly as bulls who'd been trapped in the initial avalanche. The downtrend had drawn enormous power from huge open positions in far-out-of-the-money put options. For years, selling them 'naked' was considered a reliable source of free money. But when stocks started to fall hard on that fateful Friday, the ordinarily docile puts turned into a water-cannon enema for short sellers. Traders learned their lesson, and more than a few of my colleagues in the pits of the Pacific Stock Exchange
