Rick Ackerman

With gold in one of its steepest climbs in recent memory, the 2068.00 rally target billboarded in my last update looks like a lock-up. The December contract's midweek stab through p=1945.80 all but clinched this outcome, along with a likely test of May's $2129 record high. That would bring into play an even bigger, bullish pattern begun in November 2022 from 1711 and which targets 2241.90.  These are the most ambitious targets I've broached in a year, but my high confidence is commensurate with the rally's steepness and the intimidating difficulty of climbing aboard.

Silver's rally last week wasn't quite as impressive as gold's, but it did manage to somewhat exceed the 23.70 target of the middling 'reverse pattern' we'd been using to stay on the right side of the trend. The next significant target is 27.18, a Hidden Pivot derived from a conventional pattern on the daily chart where A=20.61 on March 8. However, because we can assume silver will not ultimately lag far behind gold, I'll air a 28.15 target that is shown in the inset chart.  Critical resistance, and possible confirmation of the pattern, will come at p=24.83, my minimum upside target.

It's going to take investors a while to get used to the idea that higher gold prices must eventually produce higher prices for mining stocks. However, their skittishness is understandable, given the pounding, false starts and countless disappointments gold bugs have endured since prices topped in 2011. This phase of the fledgling bull market targets 72.73 (monthly chart, A=19.52 in March 2020). However, for reasons of practicality and tradeability, we can use the daily chart shown (inset), with a 42.09 target and minimum upside over the near term to p=36.28.

Although AAPL ended the week in the same precarious place as the E-Mini S&Ps, we shouldn't forget that it wears a wing suit for such occasions. The stock's institutional sponsors let it fall only when it suits their needs -- in this case a presumptive eagerness to load up at p2=159.25, nearly $14 below the current price. They've had more than two months to distribute Apple shares in preparation for this maneuver, so let's not feel sorry for them if their holdings deflate precipitously for a little while. The speed at which the stock falls will tell us how successfully they've been and how eager they are to run the stock back up to some insane height. The news backdrop features a nasty decline in iPhone sales in China, one reason we can be confident the bear market begun in mid-July from 198.11 will eventually find its way down to at least 146.13.

We've been using a 117 target to discount the horrific geopolitical climate, but for trading purposes let's focus on the 98.69 target of the pattern shown. It is affirmed by September's powerful thrust past the 80.85 midpoint resistance, but also by the difficulty crude has presented for anyone wanting to get long, even by way of last week's all-too-fleeting dip to a 'mechanical' buying trigger at p=80.85. Gasoline prices dipped as well, but they will be headed higher soon if December Crude is in fact on its way to at least 98.69.

The week ended with an unsettling pause when the futures went into a trance rather than leap off a cliff. Settlement was just above a low made on October 4, beneath which lies a nearly 100-point drop to a secondary Hidden Pivot at 4138.  What shocks is that DaBoyz did not cause the futures to feint briefly beneath the low, the better to run them up the wazoo of shorts enjoying a rare moment of self-satisfaction. In any event, the 100-point fall looks like it's in-the-bag, even if half of it occurs Sunday night. That would make the futures a potentially opportune buy when they reach p2=4138.

It took nearly two weeks for bears to recoup their mojo after getting sucker-punched by a suspiciously buoyant market following the October 7 Israel massacre. Although the attack could lead to a nuclear conflagration and world war, Wall Street kept its cool while trade desk sleazeballs deftly distributed shares to the rubes. But Fridays are often clarifying, since they force traders to guess how America's mood might change or intensify over the weekend. That would explain why stocks fell hard to finish the week. But this followed nearly two weeks of perverse strength, presumably because there is virtually nothing for anyone to be bullish about at the moment. Geopolitical news grew still grimmer last week, even as shares hovered until Wednesday as though they were gathering strength for one more psychotic upthrust. A 'Theoretical' Buy We should never discount this possibility, as the chart reminds us. What it says, in coldly disinterested technical terms, is that the Dow Industrials became a theoretically enticing buy when, with dubious prescience, they bottomed on the green line just hours before the Hamas attack. Under the simple rules of the Hidden Pivot System, this triggered a 'mechanical' signal to get long. Although this doesn't't necessarily mean we should expect the Indoos to rocket to new all-time highs, it does portend a rally to at least the red line (34,455) before DJIA relapses to beneath  C=31,428. This bullish set-up usually works, so don't be surprised if a preternaturally powerful rally develops amidst growing darkness in the real world.

Even though Friday's rally was the best we can recall in a long time, there are still reasons to believe it may not have been the usual fraud. We'll know once we've seen how buyers handle the green line (x=2041.60). Ordinarily a hit there would trigger a succulent 'mechanical' short to as low as D=1777.10. My hunch, though, is that the rally will liquefy the Hidden Pivot resistance and keep on going, ultimately surpassing the nasty, bull-trap summit at 2129.70 recorded back in April. In the meantime, using x=2041.60 as a minimum upside objective, we have a hundred points of bull-friendly turf to play with. ______ UPDATE (Oct 18, 9:10 a.m.): Buyers had little trouble pushing past the 1955.40 'D' target of a gnarly pattern this morning, implying they will be gung-ho to take on an important 'external' peak at 1972.40 before pressing on to an all but inevitable rendezvous with $2000. Here's the chart. The move targets a minimum 2068.00 on the daily chart (reverse A=1885.20 on 3/8).

Friday's pop through the red line left no doubt that the rally will reach the 23.695 target of the middling reverse pattern shown. We can trade confidently with a bullish bias until then, but it is what happens thereafter that matters. A decisive move through the Hidden Pivot or a two-day close above it would portend a likely follow-through that tests  the 26.940 peak recorded in May. In any event, the next 80 cents of the ascent looks so certain that we might expect half of it to occur when the futures resume trading Sunday evening. _______ UPDATE (Oct 16, 12:03 p.m.): Don't believe bullion's sluggishness today; it is being stage-managed by big players who are even more eager than you or I to buy the stuff before it takes off.