My coverage of crude will remain perfunctory, since paying closer attention might induce coma. Its gratuitous ups and downs over the last three years have been worse than merely screwing the pooch. The head-fakes, foot-fakes and other annoyances are especially difficult to trade, and even voodoo numbers don't seem to work. Although the sonofabitch cannot outsmart us when we observe its stupid little tricks on a 5-minute chart, it's simply not worth the effort to stalk them. No one has mentioned crude in the chat room in months -- not even Artie -- but I will continue to answer your trading-related questions as always.
The party is over, or so says the chart above. It is a long-term picture of the E-Mini S&Ps, and it shows the futures rolling down after touching a 6136 target that has been nearly five years in coming. Actually, it has taken nearly 16 years to get there since the longest bull market in U.S. history began in March 2009. The economy was emerging from the devastation of the Great Financial Crash, ready to embark on a fresh cycle of foolishness that has put Americans much deeper in hock. The major stock indices have more than quadrupled since then, and anyone who has stayed fully invested in index futures or a few high-flying 'lunatic stocks' would have achieved long-term gains that no portfolio manager in decades past could have imagined. My analysis has utilized a standard ABCD pattern to project the 6135.25 top. However, it should not be expected to work precisely for two reasons. For one, it is a blended chart, with key highs and lows derived from many successive contract months. Although the coordinates are matched closely, the result is not seamless, and the 'D' target could therefore be off by as much as 10 to 15 points. For two, the pattern is so in-your-face obvious that every Tom, Dick and Harry who fancies himself a chartist would have spotted it more than a year ago and used it to ride the bull to the top. Obvious, but Potent Assuming they did, more than a few would have reversed their positions and gotten short at the recent peak. If so, we shouldn't be surprised to see a short squeeze rip them a new orifice in the weeks ahead. The result would be a jagged top littered with the bodies of intrepid traders. Whatever happens, I strongly doubt
The S&Ps have yet to collapse in the heat of Santa Season as I had suggested they might, but they are acting mighty strange. Friday should have been a slam-dunk for bullish seasonality. Instead, the futures doubled-topped just shy of a juicy rABC rally target before selling off hard to end the week. Granted, there was a heavy layer of supply just beneath early December's record high near 6200. But it's not as though setting up a short-squeeze to get past it should have posed any difficulty for the scumballs who manipulate the markets. Let's give it another day to see whether the thimble-riggers are impaired or merely toying with shorts. If the latter, the futures should produce a profitable 'mechanical' buy at the green line (x=5930.44). You can trade this one for real if you know what you are doing, but it is not recommended for Hidden Pivot greenhorns.
The daily chart yields a much clearer picture than the 30-minute displayed here last week. It yields a 420.18 'd' target that can be used to bottom-fish the now three-week selloff with risk very tightly controlled. The downtrend did not demolish the midpoint Hidden Pivot support (p=438.17) on the way down, and that makes more weakness to d less than ironclad. However, it looks likely, and the gnarliness of the pattern suggests the turn from 420.18 would be sufficiently precise to allow for the tightest imaginable stop-loss. Please note that if MSFT is in a downtrend that has further to go, all U.S. stocks will be under similar pressure. _______ UPDATE (Jan 3, 10:56 a.m. EST): The trade was an easy winner using a reverse-pattern (rABC) to trigger, since the stock caught a nearly $6 bounce from 420.66. It eventually went lower, however, and is in the throes of a short-squeeze bounce off yesterday's bombed-out low at 414.85. Despite the ferocity of today's rally, I now expect the stock to fall to at least 409.05, and thence to 393.35. Plan on getting short with a tight stop if the bounce hits 430.07.
Bitcoin has drifted as low as 92,000 since topping two weeks ago a micron from a Hidden Pivot target at 107,343 that I'd flagged. The target came with an explicit recommendation to get short there. Now an opportunity is taking shape to bottom-fish the 89,246 target shown, again with as tight a stop-loss as you can craft. The pattern has already delivered a theoretically profitable 'mechanical' short position from the green line (x=97,218), at least half of which would have been covered on the subsequent drop to p=94,561. The bottom-fishing trade looks pretty juicy to me, so I will not be sharing it with the public or non-paying subscribers. To avoid queering its Hidden Pivot magic, I would ask that you not share it either. BRTI is not a tradable vehicle, so plan on interpolating the target for use with BTCUSD, GBTC, or any other symbol of your choosing.
I've labeled the impulse leg shown in the chart 'promising' because the pattern's point 'B' low crushed an external low the way reliable A-B legs are supposed to. So what does it promise? Two things of value to us: 1) a profitable 'mechanical' short if the futures should rally to the green line (x=2696.00); and 2) the prospect of bottom-fishing when D=2500.00 -- a logical minimum downside target -- is reached. Because a gaggle of village idiots will be trained on round-number support there, we shouldn't count too heavily on a precisely tradable turn. There is also a chance of that occurring from the secondary pivot, p2=2565.30. However, bottom-fishing there would need to be done with a 'counterintuitive' (i.e., rABC) trigger. Nudge me in the chat room for guidance in real time if I'm around. _______ UPDATE (Jan 2, 2:18 p.m. EST): I don’t trust today’s rally, but there is no percentage in trying to intercept it. The Feb contract is currently trading at 2668.30 and looks likely to achieve 2722.40. That would still leave it shy of December’s 2761.30 peak, let alone the record 2826.30 recorded on 10/30. One trade to recommend: buy a dip to 2628.10, stop 2596.70. Since that implies $12,000 of risk on four contracts, you would need to fashion a small-pattern trigger (aka ‘camouflage’) to cut the risk by 95% or more.
With the current focus on gold and silver futures calling for moderately bearish outcomes, I've selected a GDXJ chart that shows a potential best-case scenario. It implies that the 47.14 low that ended the week came close to fulfilling a minor d correction target at 46.69. If so, and the gold miners are close to an interim bottom, that would imply bullion prices are also about to turn higher. Regardless, GDXJ can be bottom-fished at 'd' with a reverse-pattern trigger of small degree (i.e., 'camouflage'). Alternatively, if sellers simply shred 'd', expect more downside to at least 44.75 (daily chart, A= 50.57 on 11/7). _______ UPDATE (January 5): Last week's rally failed to generate an impulse leg on the daily chart because its 44.91 apex fell 18 cents shy of surpassing the 45.o8 'external' peak recorded on December 20. This disappointing price action implies that the 40.21 'D' target is still likely to be reached.
The pattern shown has enough quirks that it should work precisely for bottom-fishing at D=28.185. That Hidden Pivot also makes a logical minimum downside target because of the downtrend's decisive penetration of p=30.728 on the way down. That is why the chart is somewhat more bearish than the one I have presented in gold with a 2500.00 target. As exhilarating and encouraging as a silver rally to x=31.999 might seem at this time, it would actually trigger a 'mechanical' short with potential for tight risk management and good odds for success.
Nothing can prevent more slippage down to at least D=40.21, the Hidden Pivot target of the pattern shown. That will amount to a 27% decline since this symbol topped near 56 in October. The target is unlikely to be usable for conventional bottom-fishing, unfortunately, since it is coincident with a low recorded back in August that is certain to attract the attention of the herd. The pattern is too obvious as well, but it is also sufficiently compelling for us to assume the bear cycle begun in October will not much exceed it. If you plan to bottom-fish, use a 'counterintuitive' trigger with an rABC pattern that comes from the 15-minute chart or lower. The point 'c' low can be planted just above the August low (40.26), equal to it, or slightly below it, since a bounce from within the midst of these levels will be unavoidable.
I’m making no bold predictions for 2025, since getting it right in these way-too-interesting times is like trying to guess when a ticking time bomb will explode. When it does, the shrapnel will pop an economic bubble so pumped with folly, greed and hubris that only a Wall Street shill or a madman could believe the soft-landing story. Made-up statistics to support this fantasy are being peddled aggressively nonetheless by the likes of Bloomberg, The Wall Street Journal and a few other mainstream sources whose editors evidently are incapable of imagining what a hard landing might look like. For starters, a commercial real estate market that has been imploding in slow motion for more than three years will collapse with the swiftness of a black hole, swallowing up a galaxy of underperforming assets in nanoseconds. Tens of trillions of dollars’ worth of imagined ‘wealth’ will be wiped from the global ledger by the tsunami that follows. And yet, against this likelihood, Wall Street’s newspaper of record can still report with a straight face that some Manhattan landlords are starting to make money with office rentals. A recent article would have us believe the city's property market may have bottomed. The unfortunate truth is that the relative handful of big companies that are signing leases rather than fleeing New York's high taxes and rampant street crime have been moving into showcase buildings that represent only a minuscule fraction of rentable space. Meth-Money Bitcoin’s inevitable implosion could set an even bigger disaster in motion. The collapse will inflict long-lasting psychological damage on securities markets, but it will also purge an important source of meth-money from the financial shell game that sustains global GDP. The possibility that Bitcoin will fall from whatever peak it achieves above $100,000 to under $100 exists because it
