Rick’s Picks

September Silver spent the week munching on midpoint resistance at p=29.700 ahead of a presumptive push to at least p2=31,298, and thence D=32,895.  There's always the chance Mr Slammy could bludgeon the futures lower for a few days, but a fall to x=28.103, however unlikely, should be regarded as a great buying opportunity. Silver moves much like crude, which is to say, with wicked, gratuitous feints in both directions that could unnerve anyone not proficient at interpreting charts. Focus on impulse legs of varying degree and you'll never go far wrong.

Mr Slammy hauled out his sledgehammer and knocked GDXJ for a loop midweek, but by Friday buyers were back in force, threatening to turn the 49.02 midpoint Hidden Pivot resistance into chop suey. It had stopped a strong rally cold a week earlier, but the next time, which appears imminent, bulls seem likely to triumph.  A decisive breach of the red line would put this symbol on track for an easy shot at p2=60.62. That number can be used as a minimum upside projection once GDXJ has traded for two consecutive days above p.

[I’m taking a summer break, so this will be my last commentary until after Labor Day. It will be the usual busman’s holiday for me, however, and actionable ‘touts’ for popular symbols will be updated ‘round-the-clock as always. Some recommendations will be accessible to non-paying subscribers, so check the home page regularly, especially if stocks go bonkers. I will also continue to provide tradable guidance and timely analysis in the chat room. To sum up the markets for now, though, let me note that the scripted savaging of the lunatic stocks (aka the egregiously misnamed 'Magnificent Seven') unfolded in July exactly as anticipated. Now, I am focused on the strong possibility that the manic bounce that has ensued will turn out to be a sucker rally, a distribution much like the summer binge that preceded the 1929 Crash. Concerning the painting, it is by Geoffrey Leckie and titled 'Restoration of St. Marco'. Geoff and I attended the University of Virginia at the same time and shared a farmhouse outside of Charlottesville. He is a deeply gifted artist whose works, mostly oil on canvas, include landscapes, still-lifes and portraits that have always stirred me with their beauty and uncompromising style. His California seascapes are a particular favorite of mine, capturing the roughness of the Northern California coastline and the ceaseless fury of the waves. Geoff lives in Venice, Italy, but travels the world for inspiration. Here is a link to some of his other paintings and the galleries that represent him. The Venetian scene is thematically tied to the literary text below, an excerpt from Thomas Mann’s magisterial The Magic Mountain. Mann considered vacations essential to restoring one’s vital energy following boring stretches on-the-job. His novella Death in Venice concerns a writer who takes a holiday to recoup his gifts, only to

The futures are bound for at least 5749.25, the 'D rally target of the conventional pattern shown. Barring nuclear Armageddon, this outcome is all but certain because buyers had no difficulty whatsoever getting past the 5434 midpoint Hidden Pivot last week. The move used up the largest available reverse pattern on the daily chart, so I've switched to the conventional one you see in the thumbnail inset. The vehicles we trade are unwitting slaves of Hidden Pivot levels, and so it comes as no surprise that E-Mini S&Ps spent all day Friday heading-butting Hidden Pivot resistance points. The intraday high occurred at the 5573 'd' target flagged here earlier as a place to get short, but also at the secondary pivot (p2=5591) of the new, conventional chart. ________ UPDATE (Aug 21, 10:05 a.m. EDT): As anticipated, the futures are getting second wind, presumably to make a tradable high even closer to the 5648.00 target I flagged in the chat room earlier this week. See my Monday, 11:39 points for details and an illuminating chart.

Our favorite bull market bellwether is still on track for a rendezvous with 449.13, the 'd' target of the reverse pattern shown. Buyers didn't exactly shred the midpoint resistance (p=417.36), but they did exceed it by four points, then closed above it. That is sufficient for us to infer the stock is likely, if not quite certain, to achieve 'd'. A pullback first to x=401.47, however unlikely, would offer an excellent opportunity to get long 'mechanically', although I expect the stock to head straightforwardly to p2=433.24 when trading resumes Sunday evening.

With expectations of a rally into the low 80s at least, we should be prepared to bottom-fish this correction when it comes down to the green line (x=73.56). This is a 'mechanical' set-up, and it comes with the caveat that x is neither target, nor support, nor Hidden Pivot, just a place on charts where we set up 'mechanical' trades. This one looks like a very good bet, but it will require staging on the lesser charts, since the textbook stop-loss would otherwise be at 70.87, a tick beneath C. That's too much to risk on a conventional entry, so stay tuned to the chat room for alternatives. _______ UPDATE (Aug 19, 9:34 p.m.): The futures rallied 45 cents after bottoming at 73.48, affording us a small winner of around $920 on four contracts (see my 14:58 post in the chat room for details). They have relapsed this evening and are now rallying in their wonted, psychotic fashion after making a marginal new low. Step away as crude carves out a tortuous bottom. _______ UPDATE (Aug 23): Crude doesn't merit an update, since it's trading exactly where it was six months ago. This is notwithstanding the flatulent rumble emanating from the charts since then. It has been paradoxically easy to trade, but you'll have to nudge me proactively in the chat room for timely guidance. _______ UPDATE (Aug 31): Zzzzzzzzzzzzzzzzzzzzzzzzzzz.

Gold took off Friday following a shallower correction than we'd become used to. It's tempting to say that the scum balls who manipulate bullion prices for a living lost control, but more likely is that they are simply ready to let 'er rip. In any case, the October contract finished precisely at the authoritative trendline shown, and unless DaBoyz believe they can accumulate yet more tonnage with another takedown, this week should see the breakout that will finally take gold to $3000.

We had great fun with Comex Silver last week, notwithstanding its reputation among traders as a Brahma bull. Although it was not exactly docile, its gratuitous feints, squiggles, plunges and war-whoops were so easily and precisely predictable that we managed to hit a half-dozen tradable highs and lows before the week ended. I stayed closer to the intraday charts than usual after eliciting pledges from a bunch of subscribers to make the extra effort worth my while. And so it was.  If you're eager for more, then by all means light up the chat room with more ballyhoo. In the meantime, you can count on the little sumbitch to fist-pump to the 29.620 target shown, a Hidden Pivot resistance that would be tricky to short, since it lies a single tick above an 'external peak recorded July 24 on the way down.

Bulls finished the week comfortably above an external peak at 46.32 recorded July 31 on the way down. This left GDXJ in good shape to achieve the 48.45 Hidden Pivot target shown in the chart.  The pattern is the biggest reverse abcd I have at my disposal for projecting a high, although not necessarily a top. The target should be regarded as a minimum upside projection when the new week begins. The decisive penetration of p makes this a high-probability bet.