Although the futures have rallied nearly 700 points from last Monday's Hidden Pivot low, their failure to surpass the small external peak shown in the inset was timid behavior. It also set up a theoretical 'mechanical' short at 5406.25 (stop 5529.00) that we'll ignore. Instead, let's give bulls the benefit of the doubt for now, meaning we should expect a thrust above the 5528.75 recovery high shortly. Alternatively, a relapse could send the futures down to as low as d=5038.75 in search of traction (60m, a=5322.00 on 4/4). You could bottom-fish there aggressively with a stop-loss as tight as 2-3 points.
Last week's violent swings paused at the 389.29 midpoint Hidden Pivot shown in the inset. The shallow pullback from this resistance implies bulls had plenty of energy for a follow-through to the pattern's 'D' target at 410.78. If the stock pulls back to the green line from near the 395 'sweet spot', that would generate an appealing 'mechanical' buy signal. So would a pullback to the red line (p=389.29) once p2=400.04 has been touched. Your bid should be tied to a 382.12 stop-loss, but you could substitute naked-short puts for shares..
Ten-Year rates have taken a Whoopee Cushion bounce en route to a presumptive bottom at 3.67%. It reportedly was caused by the wholesale dumping of T-Bonds by European banksters intent on disrupting U.S. financial markets. Powell's tightening regimen is making it difficult for them to open up the credit spigot, and so they have desperately tried to force his hand. The survival of some large American hedge funds could be at stake, since they were leveraged up to the eyeballs with a spread that required a bullish position in bonds. With Powell standing his ground, my gut feeling is that the panic will subside shortly and that rates will not break out above January's 4.81% high. _______ UPDATE (Apr 21, 6:51 p.m. EDT): Rates on the Ten-Year Note look primed to burst through the 4.42% midpoint Hidden Pivot resistance shown in this chart. If they do, they should be presumed bound for at least 4.58% or even higher, to levels that could knock the U.S. economy and stock market for a loop.
I've drawn a cautionary pattern because gold is long overdue for a full abcd correction, and because Friday's high occurred almost precisely at a 3261.40 target I'd posted in the chat room around 10:00 a.m. Assuming the high endures, the rABC pattern implies a pullback to the 2868.60 'd' target is likely. (Note: You'll need to shift 'c' upward if gold continues to rise.) The years-old 'a-b' segment remains viable because no pullback since this leg was completed in 2021 has reached 'd'. If it does now, that would amount to a 12% correction. You can bottom-fish with a tight stop at p, but be aware that its decisive breach, wherever it occurs, would warn of more slippage to 'd' or lower. _______ UPDATE (Apr 14, 1:25 p.m.): The correction predicted for gold using the weekly chart (see ‘above) would be quite painful, but there is a milder scenario suggested by the hourly chart reproduced here. June Gold, playing coy, has not yet tripped a theoretical sell signal by touching the green line (x=3205.20), but if and when it does, it should be presumed bound for the midpoint Hidden Pivot support (p) at 3147.40. We’ll be better able to judge the strength of the downtrend after we’ve seen sellers interact with p. A decisive penetration on first contact would imply more weakness, as would a subsequent overshoot of d=3031.80. Both levels can be bottom-fished with a tight stop-loss. (Note: So much for weakness! The futures still haven't tripped a sell signal, never mind sold off. The chart has been updated and slightly revised, since the original ‘c’ coordinate was slightly off.)
The May contract got a strong push last week to the 'secondary' Hidden Pivot (p2) of a pattern with the potential to deliver more upside over the near term to d=33.635. The initial penetration of p=30.590 was hesitant, but once the futures got past the resistance they never looked back. Assuming silver plays hard-to-get, be ready to buy a pullback to p=30.590 'mechanically'. Your bid at that price would take a stop-loss at 29.575, so a 'camouflage' trigger of lesser degree is suggested. An easy and decisive move through d would portend more upside to 36,769, or even 39.844.
GDXJ struggled for eight months to push decisively past midpoint resistance at 49.02, so there are no guarantees that it will easily reach the 72.23 target, especially straightaway. More likely is a ratcheting move to the target that requires 6-8 weeks to complete. Gains from one peak to the next will likely be smaller than theoretical losses incurred from holding shares from trough to trough, but that also means positions can be 'worked' with covered writes on the way up to squeeze additional yield from your position.
The failure of sellers to push this air ball down to the 70,417 target is mildly bullish, but it will take an upthrust exceeding the two 'external' peaks recorded on March 24 and April 2 to put bulls back in charge. The peaks lie, respectively, at 88,530 and 88,805, close enough to form a double resistance that will require short-covering to penetrate. Once that happens, the 94,850 point 'C' will magnetically draw this vehicle higher. There is a theoretical path to as high as 133,759 (weekly chart, A=49,050 on 8/10/24), but we'll put that out of mind until such time as p=104,090, just beneath the record 108,388, is achieved.
Quotes for crude have turned up from an odd place, well shy of a 'secondary' Hidden Pivot support at 49.25. Odds of a relapse will depend on how bulls fare pushing past a minor Hidden Pivot resistance at 62.22, and another at 65.68 (60-min, A=56.42 on 4/9). If both of these numbers are exceeded, especially decisively, then last week's low at 55.12 may prove to have been an important one. For now, set screen alerts at 62.22 and 65.68 to determine whether the bounce is likely to get legs.
[Just ahead of last Monday’s steep plunge, I predicted here that an S&P reversal from 4820 would mark the end of the bear market. So far, SPX has rallied 646 points off an actual low at 4835. Bulls are not yet out of the woods, however, since a relapse could occur at any time. The stock market remains spooked by Europe’s dumping of Treasury paper in a deliberate attempt to destabilize the U.S. financial system. With the EU economy swirling down the crapper, the globalists are desperate to force Powell to ease in order to rescue big hedge funds that were leveraged up to their eyeballs with Treasury paper. So far, the Fed chairman has stood his ground, and it appears the EU attempt to sabotage the U.S. bond market will fail. In any event, the commentary below will continue to run until such time as the S&Ps crash the 4820 Hidden Pivot and prove me wrong. If you keep my thesis in mind — that as long as 4820 holds, there will be no recession, nor any harmful effects from tariffs — you will be better able to judge the jaw-dropping stupidity of the mainstream media’s coverage of Trump 2.0. Because of their blind hatred of the president, the eggheads, reporters, pundits and benighted editorialists will continue to get everything wrong until stocks are once again soaring to new all-time highs. RA] *** A word of advice if you’re looking for bankable information on the direction of the economy: tune out the mainstream media’s cavalcade of Trump-deranged bozos and focus on the 4820 target in the SPX chart above. Think of it as Trump’s lucky number, but also a very good place for these all-too-interesting times to find temporary equilibrium. That is my worst-case target for a bear market that many believe is
[Just ahead of last Monday's steep plunge, I predicted here that an S&P reversal from 4820 would mark the end of the bear market. So far, SPX has rallied 646 points off an actual low at 4835. Bulls are not yet out of the woods, however, since a relapse could occur at any time. The stock market remains spooked by Europe's dumping of Treasury paper in a deliberate attempt to destabilize the U.S. financial system. With the EU economy swirling down the crapper, the globalists are desperate to force Powell to ease in order to rescue big hedge funds that were leveraged up to their eyeballs with Treasury paper. So far, the Fed chairman has stood his ground, and it appears the EU attempt to sabotage the U.S. bond market will fail. In any event, the commentary below will continue to run until the S&Ps crash the 4820 Hidden Pivot and prove me wrong. If you keep my thesis in mind -- that as long as 4820 holds, there will be no recession, nor any harmful effects from Trump's tariffs -- you will be better able to judge the jaw-dropping stupidity of the mainstream media's coverage of Trump 2.0. Because of their blind hatred of the president, the eggheads and benighted editorialists will continue to get everything wrong until stocks are once again soaring to new all-time highs. RA] *** A word of advice if you’re looking for bankable information on the direction of the economy: tune out the mainstream media’s cavalcade of Trump-deranged bozos and focus on the 4820 target in the SPX chart above. Think of it as Trump’s lucky number, but also a very good place for these all-too-interesting times to find temporary equilibrium. That is my worst-case target for a bear market that many believe is
