Rick Ackerman

We're long 400 shares from a 'mechanical' buy at the green line (x=34.60). Friday's bull-trap rally on the opening bar strongly implies GDXJ will take out at least another low or two before it can get traction. So that we don't get caught like everyone else in a stressful second-guessing game, I'll suggest sticking with the 34.11 stop-loss I posted in the chat room on Thursday. My hunch is that a more tradeable low will occur near 33.21 (60-min, A=36.80 on 9/1). We can try again to get long there rather than suffering-and-shuffling along with the herd in the meantime. _______ UPDATE (Sep 25, 10:04 p.m.): Today's nasty dive stopped out the trade for a loss of about $200. This is a sign of rotten health, considering the textbook appeal of the pattern we used to get long 'mechanically,' 

Crude turned sluggish last week, but not before generating a bullish impulse leg on Friday that will likely hold positive consequences for the near term. I say 'positive' while acknowledging that another turn of the screw could send the world's fragile economy into a tailspin. Pump prices are already above $4/gallon and will become headline news when it looks as though $5 is coming. To get in step with that eventuality, I've lowered the point 'A' low of the chart we've been using to produce a somewhat higher target at 94.76.  A swoon to the green line (x=87.69) would generate an attractive 'mechanical' buy signal, but we'll wait until it is close to happening before we hatch a strategy to trade it. _______ UPDATE (Sep 28, 1:54 p.m. EDT): November Crude has plunged after topping a hair from the 94.76 target billboarded in the current tout. This adds to the evidence that The Big Picture may have changed, since the dollar and Treasury rates have also reversed sharply after achieving important Hidden Pivot targets precisely. 

The bullish gap on the chart holds ominous implications for the global economy, since it removes almost all doubt that interest rates on U.S. Treasury Bonds are headed significantly higher. The rally looks nearly certain to reach 4.81%, the target of the pattern shown.  The red line through which the gap occurred last Thursday is a 'Hidden Pivot midpoint resistance,' and it is where we look to get a firm handle on trend strength. When it is penetrated as easily and decisively as it was last week, this almost invariably results in a continuation of the trend to the target, in this case a 48.14 level that corresponds to a 4.81% rate. A tradeable corollary is that a swoon to the green line would be merely corrective, and that bond bears, far from being scared out of their positions, could double down on their bets with confidence.  The equivalent rate for the Ten-Year Note would be 4.68%. Historical Downturn You should jot those numbers down, since they will allow you to tune out the din of pundits and economists arguing about how high rates are likely to go. With the economies of China and Europe already sinking into recession, and the U.S. about to do so when the inevitable bear market in stocks gets rolling, another turn of the interest-rate screw threatens a downturn that will be one for the history books.  It will feature above all a strengthening dollar that will not only catch economist and policymakers by surprise, but also crush everyone who owes dollars. A ruinous debt deflation is coming, and it will make us nostalgic for the pesky consumer inflation that has ruled our economic lives since the wildly reckless credit-stimulus of the Covid years.

[Last week's commentary on the gathering economic storm elicited a light-hearted reminiscence from our friend Richard Charles of Alpine Capital.  You'll find his recollection of some notable deflationists enlightening, and there's also a new word -- screwflation -- he has coined to describe a phenomenon that has yet to gain traction with eggheads at some of our finer universities. RA] Must have been something stimulating in that New Jersey aquifer we drank from, before saltwater and tritium from the Salem County nuclear plant made Bourbon the safer beverage. Since the Great Depression, an ever-inflating Fed made houses the number one wealth engine for the middle-class American Dream. Our Palo Alto home accidentally saw unbelievable nominal appreciation exceeding the original price tenfold -- or a hundredfold if you run the numbers with 10 % down on an adjustable-rate, fixed-payment, negative amortization at sixteen percent that everyone, especially the mortgage broker and realtor, told us was cuckoo. Merrill’s all-American asset manager back then in the mid-1980s, pipe-smoker Stanley Salvigsen, was a deflationist who actually shorted his home and made money. He was invited to leave Merrill for Comstock Partners before he died at 53 of a heart attack in the mid-90s. His offense: staying too short for too long. Bucking Merrill Lynch Gary Schilling had a similar experience in the mid-70s with Standard Oil,  the San Francisco Fed, Merrill Lynch and White Weld. His complaint letter to Don Regan, Merrill's CEO and former U.S. Treasurer, attested that Schilling's disinflationary views did not comport with Merrill Lynch's bullishness on America. This is despite the fact that his unconventional ideas made money for the investment firms' clients. Back in Silicon Stanford Valley, the biggest bond bull-market in history bailed us out with rates that ultimately fell almost to 2%, freeing yours truly for a

The Dollar's impressive move off mid-July's 99.58 low will face a crucial test when it encounters the impediment shown in the chart, a Hidden Pivot midpoint resistance at 106.32 that lies less than 1% above. I am predicting an easy move through it, bringing the realization that the inflationistas have had it wrong all along; for in plain fact, consumer inflation was never going to be a big deal in comparison to a deflationary juggernaut of financialized debt totaling more than $2 quadrillion. So many owe dollars that inflation -- or better yet, hyperinflation -- would be a blessing. And that's why it is not going to happen, if for no other reason than that everyone has piled onto the same side of the bet. Those still in denial will be in for a shock as DXY continues to rally toward the 113.06 target.  By then, there will be fewer dollar bears to muddy the picture, and the quacks who run the central bank, especially the hawks, will have their backs up against a wall.

Quotes rose sharply again last week, threatening consumers around the world with yet more bad news and higher prices for everything. If the October contract were to pop through the secondary Hidden Pivot at 90.99 where it came to rest on Friday, that would likely spell more upside to at least D=99.84 (with a possible 'local' stop at 93.72, using A=7.26 on the '60' from 8/29). It would also push the price of a gallon of regular gas toward $5 and quite a bit higher in California. It is fortunate that the stock market, Wall Street, pension funds, insurance companies, and private and public investors have gone full-on 'mental' at the moment, since any sane reflection on the economic implications of oil priced at $100/barrel would produce a panic out of stocks. It's coming anyway, but don't be surprised if investors awaken one morning to an avalanche of cognition that kicks off the bear market with unmistakable force. _______ UPDATE (Sep 19, 9:25 p.m.): The 'local stop' at 93.72 flagged above caught the top of a so-far $2.67 plunge within two pennies. No one mentioned it in the chat room, however, so I haven't established a tracking position. If anyone still trades this vehicle or even remotely cares about it, it is time once again to declare your interest in the chat room.

AAPL's big bounce in August may have added tens of billions of dollars to the macro ledger for a short while, but September's symmetrical decline has taken it all back. The stock still appears bound for D=164.90 of the pattern shown, equating to a 17% decline from the 198.23 high recorded in early July.  Since Apple shares have been an infallible bellwether for the stock market as a whole, we'll want to pay close attention to price action when 164.90 is hit, which it eventually will be.  If the Hidden Pivot support is decisively exceeded, it would imply more downside is possible to as low as 146.25, a Hidden Pivot support derived from shifting 'A' up to last August's 176.15 peak.

The futures came down hard enough on Friday to suggest there must have been an interesting reason, but the chart suggests it was just tiredness. In fact, if the December contract were to fall just a little further to the green line (x=4454.25), that would generate a weak 'mechanical' buy signal.  I would expect a profitable, one-level bounce, at least, but whether buyers could summon the additional power needed to achieve D=4623.75 remains to be seen, especially since our standby market bellwether AAPL could already be in a bear market. ______ UPDATE (Sep 18, 8:22 p.m.): The fraudsters who work this gaff have been so unimpressive lately that I'm cancelling the 'mechanical' bid at the green line, since it no longer promises an edge.

Gold is in an obligatory bounce from the green line (x=1934.00), and any long positions initiated there would be showing a paper profit of around $4400 on four contracts. The futures would need to hit p=1954.30 to signal a partial exit, but bulls looked sufficiently energized to accomplish this when trading resumes Sunday evening. I have my doubts that the run-up will reach D=1995.00, though, in part because the turn from the recent low looked too agonized. Regardless, 1995.00 is theoretically in play and would become an even better bet if the rally impales the midpoint Hidden Pivot on first contact. _______ UPDATE (Sep 18, 9:17 p.m.): The textbook 'mechanical' buy that triggered a week ago at x=1934.00 has gone on to produce an $8000 gain for anyone who did the trade. It is time to realize half of your profits now, since the futures this evening have touched the red line (p=1954.30) as anticipated. Here's the chart.  _______ UPDATE (Sep 20, 8:20 p.m.): The vicious bull-trap stab this morning to 1069 was short-lived, but it gave anyone still long an opportunity to exit with an additional $1800 for each contract still held. If you kept 25% of the original position for a swing at the fence, I'd suggest an 'impulsive' stop-loss at 1943.70 for now.