Last week's wrenching slippage brought GDXJ down to within 18 cents of the 50.55 'd' target of a reverse pattern on the daily chart that was displayed here previously. I've graduated to a bigger bearish pattern that targets 46.71, but the breach on Thursday of that pattern's 51.15 midpoint Hidden Pivot implies the correction will come down to at least p2=48.93. It could fall a further 2.22 to d=46.71, as noted above, if the 'secondary' support (i.e. 48.93) gives way easily. You can bottom-fish either Hidden Pivot with as tight a trigger interval as you can identify on charts of 5-minute degree or less.
The futures bottomed 33 cents above the 66.39 'd' target of a reverse pattern I flagged here last week, hinting that the riffraff was in there bottom-fishing. No matter, since we can always figure out ways to keep a couple of steps ahead of the clowns. For starters, I've moved the point 'a' high to the left, using a 'locked' high to form a reverse pattern that few if anyone will see. Bottom-fish the 65.27 target with as tight a stop-loss as you can craft if the opportunity arises. More immediately, the rally would trigger a 'mechanical' short if it touches the red line (p=71.49, although I am recommending the trade only to ace Pivoteers who know how to calculate the appropriate stop-loss.
The chart shows four Hidden Pivot levels that could yield cautious entry set-ups for traders who shun risk and especially fear high-volatility monsters like this one. We typically trade such levels using 'reverse-pattern' triggers that are discernible on the lesser intraday charts. This tactic is proprietary, but you can seek guidance in the Rick's Picks trading room, a hangout for some of the best day traders you will find online. Please note that if one of the levels shown is decisively (i.e., by more than 0.5%) penetrated on first contact, the next will automatically become the minimum downside target. The lowermost of the targets shown is 61,181, a Hidden Pivot that you should treat as a back-up-the-truck number likely to produce a precise, and therefore easily tradable, low. _______ UPDATE (November 5, 2:36 p.m.): A bullish bet at 67,379, the first place I’d suggested looking for an upturn in the post below, would have produced a gain so far of $3,146. That is based on a so-far high of 70.525 for the move. The low at 66,803 was less than 1% beneath the ‘hidden’ support of the line I drew on the chart accompanying the earlier post. My hunch is that bitcoin will relapse to get a running start on the record 73,578 high recorded on October 29. If so, a tightly stopped bid at 64,280 can be attempted. However, 61,181 is still a back-up-the-truck place to get long ahead of a presumptive record-breaking run-up in the unlikely even Bertie pulls back sharply. Please note that the BRTI symbol is a real-time proxy for bitcoin that reflects the best bids and offers across many crypto markets at a given instant. For trading purposes, you can interpolate my targets, support and resistance levels.
[The author of this week's commentary is an old friend who worked his way up from exchange-floor clerk to commercial real estate mogul over the time I've known him. He has demonstrated remarkable timing, courage and patience as an investor, buying commercial real estate at the bottom of the 2007-08 crash and holding it until two years ago, when an even bigger crash that shows no sign of abating began. He also started accumulating a large position in physical silver as it fell from around $30 in early 2021 to $17 a year-and-a-half later. He recently cashed out his entire position at upwards of $33 an ounce, roughly doubling his stake. Now he is striking out in a radical new direction, deploying a large portion of his sizable gains in the most unpopular investment of the day, Treasury paper. Although no investor is infallible, my friend has never had a misstep with a series of all-in bets. Coincidentally, or perhaps not, Comex Gold has fallen nearly $60 after coming within $1.60 of a 2803.40 target I started drum-rolling in September, when prices were $300 lower. Is the top in? It's too early to tell, but even if higher prices are coming, anyone who has held bullion during its steep run-up since last October could not go far wrong by taking a partial profit at these levels. RA ] Each time a massive wealth transfer occurs, it is caused not by an upward explosion in asset prices, but by crushing deflation such as we experienced in 2007-8. It's about to happen again, and not with a puny, garden-variety bear-market or recession, but with the epic crash that we have all known was coming sooner or later. The list of possible catalysts boggles the imagination, to wit: a politically wrenching transition
I've led the front page this week with an election week scenario that has the E-Mini S&Ps topping at 6102 on or around Election Day. This Hidden Pivot resistance comes from a composite monthly chart, so don't expect resistance precisely at that number. However, the overall look of the monthly chart is sufficiently compelling to warrant a yellow flag when the futures get there. The target lies 4% above Friday's close, 0r 256 points. Coincidentally, a lesser pattern from the daily chart yields an almost a precisely matching Hidden Pivot target at 6102.75. That means double-stopping power, so don't miss the opportunity to get short there if you trade this vehicle. Don't hesitate to nudge me in the chat room for timely guidance.
You can always tell when portfolio managers are hard at play, immersed in an epic circle jerk that has become more tediously familiar with each passing week. And so it went on Friday, as money migrated for no discernible reason from certain, temporarily disfavored stocks to flavor-of-the-day hotties. It seemed almost as though the chimpanzees who purport to manage everyone's money were on a conference call that morning, scripting a narrative simple enough for Jim Cramer to shill to the legions of widows and pensioners addicted to his show. The Dow was down more than 300 points at its lows, even as the lunatic-sector stocks -- you know them as the idiotically misnamed 'Magnificent Seven' -- winked at the thrashing their poor cousins were getting on less sexy exchanges. The Naz was borne aloft as always by light volume and timid resistance. Bears evidently were too gutless to resist the uptrend, which in recent weeks has become increasingly confident of a Trump victory. 4% Above Sits Trouble Even so, there is a palpable feeling that the stock market has been nutso for so long that it's overdue for a sea change. That could mean irrational exuberance will peak on or around election day. But Mr Market could also surprise with a rally that turns even steeper than the one that has prop-washed the flesh from sane observers and skeptics. So which? The chart above makes a compelling case for something in-between. The 6102 S&P target lies 256 points, or 4.4%, above Friday's close. It would not be as large a gain in points as occurred in August or September. However, if the top were to coincide with the November 5 election, the entire gain would have occurred in just seven trading days. That looks like a good bet, but I
MSFT would somewhat outperform the E-Mini S&Ps if it achieves p2=444.97 around Election Day. Although the secondary pivot is not as reliable a place to go short against the trend as a midpoint Hidden Pivot, the fact that the 4.4% rally it would take to get it there is so close to my predicted 4% rally in the S&Ps makes the target worth considering as a short. We'll look to buy near-the-money puts with a week or two left on them when MSFT hits 444.97. If you're keen to trade this one, stay tuned to the chat room or your email notifications when the stock gets close.
Last Wednesday's low at 91.66 triggered the 'mechanical' buy that had been noted in the previous tout. Simultaneously, a second such buy signal occurred at the green line (x=93.21) of this smaller pattern. It carries a commensurately smaller stop-loss, but we'll back away from the trade nonetheless, since the pullback to x came after TLT had barely reached the red line. Ideally, the retracement for a 'mechanical' set-up should come from our 'sweet spot', which lies midway between p and p2.
The December contract has been a good bet to reach the 2803.40 target since September 12, when it blew past p=2576.75, retested it a week later, then never looked back. However, the pattern is sufficiently clear and compelling to temper our enthusiasm when the target is reached. Recall that we have always felt great, looking for more, just as gold was topping. A tradeable high looks likely at 2803 even if it proves not to mark an important top. We should treat it as such unless buyers impale it on first contact. Alternatively, if the December contract closes for two consecutive days above 2803, you can assume it is bound for at least 2940 (A=1933 on 10/6/23).
Correcting the reverse pattern shown has taken December Silver below the 'hidden' midpoint support at 33.63, implying it will likely require a move down to p2=32.91 for the futures to regain their footing; or even to d=32.19. In fact, a snap back rally to x=34.35 would trigger a 'mechanical' short, even if my enthusiasm for initiating the trade would not be high. If the retracement does hit d=32.19, though, it would be an excellent opportunity to bottom-fish with a tight stop loss. ______ UPDATE (Nov 2): The futures danced to our beat last week, triggering a 'mechanical' short at x=34.35 that would have evinced little pain. Now they are on their way down to d=32.19 of this pattern. You can bottom-fish with a reverse-pattern trigger that uses a= 33.26 from Oct 25. That implies a 72-cent trigger interval, but you can reduce it by perhaps 95% by using a pattern from the 5-minute chart or less. _______ UPDATE (Nov 6, 8:26 p.m.): You can still try bottom-fishing using the 32.19 'd' target to set up a low-risk trigger, but this chart shows what to expect if 'd' fails to hold. Worst case for the intermediate term could be as low as 28.455, but there's no reason to assume it will be that bad unless sellers start crushing p and D/d supports of different degree.
