The Bear Has Finally Emerged

It took the futures several days to get off the launcher following the ‘buy’ signal noted here a week ago, but by Friday they were on their way to an all but certain rendezvous with the 104.94 target shown. Because investors are obsessed with oil’s every move, we can infer that stocks will continue to fall  as energy jitters ratchet higher. The target pattern is very well-formed for reasons I won’t go into here, but that means D can be shorted with the tightest possible stop.  Please note that a decisive move through this Hidden Pivot resistance would open a path to as high as 125.26 over the near term, or even to 178.89, a target broached here earlier.

Five days of tedium could not push April Gold impulsively past the small but significant (i.e., ‘look-to-the-left’) peak at 4616.30 shown in the chart. That could change for the better with just a small leap, but until it happens there is no reason to give bulls the benefit of the doubt. However, just a little weakness could bring a test of a midpoint Hidden Support at 4282.90 that is associated with a ‘D’ target at 3964.70 (60-min, A=4736.30 on March 20).  The higher number is where a reversal should occur if bulls are ready to take charge again following a month-long slide from 5434, but either Hidden Pivot can be bottom-fished provided you understand how.  A side note: Bullion has sagged since the start of the war with Iran, but why? Turkey’s behavior may hold some answers. Although it has been one of the world’s most aggressive sovereign buyers of gold over the past decade, it sold or swapped about 60 tons of gold worth $8 billion in two weeks after the start of the war. Reportedly, this was to support a disinflation strategy that relies on a stable lira. ______ UPDATE for JUNE Gold (March 31, 7:07p.m. ET): The futures have stalled precisely at a 4709,70 ‘d’ target, but a breakout would clear a path to 4897.00, and thence to 5144.00. That last Hidden Pivot should offer precisely tradeable resistance, but its decisive penetration would announce that bulls are back in force.

Like Gold futures, this ETF proxy for junior miners spent the week in timid remission.  Although it triggered a theoretical ‘buy’ signal on Monday, the follow-through failed to reach the midpoint Hidden Pivot resistance after four days of flailing. That could chain in a trice, however, presumably with a jump-start from May Silver, which looked ready to rumble when the week ended. As always, a strong push through p would clear a path to the 133.49 ‘d’ target of the pattern shown.

Rates on the 10-Year Note came within a hair on Friday of lows not seen since October. My suggestion is to enjoy it while it lasts, since the intraday bottom closely coincided with a Hidden Pivot target at 3.952%. The actual low was 3.956%, which was near enough to consider the target fulfilled. Alternatively, if the downtrend continues on Monday, breaching not just the target but October’s 3.976% bottom, be ready for more slippage to 3.917%, a voodoo number worth bottom-fishing with as tight a stop-loss as you’re comfortable with. _______ UPDATE (Mar 7): It looks like the prediction of an important low hit a bullseye, since this vehicle has since trampolined as high as 4.19% after bottoming a split hair from the 3.952 target. Here’s the chart. _____ UPDATE (March 28): And now rates have rebounded to as high as 4.49%.  Too bad the talking heads on Bloomberg and MSNBC, the Fed board of governors and the Wall Street Journal editorialists were unaware of the potentially major turn-up when my forecast caught its exact low, since precisely accurate technical forecasts are unknown in their world of bullshit metadata.