-- Posted Tuesday, 18 July 2006 | Digg This Article
| Source: GoldSeek.com
Rick’s Picks
Tuesday, July 18, 2006
For investors who’d rather be smart than lucky
I’m once again baffled as to why any significant buying of stocks should have occurred yesterday, but it is a matter of record that the Dow did indeed rise eight points on the day. Perhaps investors have deluded themselves into believing, as someone in a chat group I monitor wrote, that it’s “just a regional conflict” with no serious implications for the world’s financial and commodity markets. Yeah, right. And the assassination of the Archduke of Sarajevo was just a petty squabble over a dinner invitation. In any event, for the time being investors seem to have bought into TV-land’s take on the war – i.e., that Condie would be in the Middle East later this week, her mere presence sufficient to ensure that cooler heads will prevail.
I wouldn’t bet on it. In fact, I’d bet against it. Our Secretary of State commands about as much respect from Hezbollah as Britney Spears and has absolutely nothing to offer the Israelis that they are likely to see as win-win. Nor is there any returning to a “peace process” that never existed to begin with, especially since neither side seems likely to accede to outside demands for a cease-fire. And why should they? What could either be promised at this point of greater importance than the goals they have long paid for with blood: Israel, to destroy the operational capability of an implacable foe; Hezbollah, to drive the Jews into the sea?
World War III?
Meanwhile, as Monday’s perverse action on Wall Street demonstrated, it’s going to be extremely tough to predict the markets, even if the world is an odds-on shot at this point to go to hell in a handbasket. I’d put out a fairly bearish prospectus on Friday, almost changing it to a full-blown alert on Sunday after imbibing quite a bit of extremely bearish analysis over the weekend. Could this conflict trigger a Third World War? You bet it could, and there’s no need to concoct an exotic scenario to make the case – only to believe it possible that Iran has its own Manhattan Project underway, and that its leaders are not in fact clinically insane.
Energy and precious metals markets are unlikely to be fooled about this for long, even if yesterday’s respite from selling seemed more like an recovered gasp than a sigh of relief. I put out a bulletin on gold Sunday night because it looked like the August Comex contract was about to blow past the 677.50 rally target I’d touted on Friday. Turns out I needn’t have alarmed you, since that is precisely where the futures peaked, to-the-tick: 677.50. The drop from that high was a rather nasty affair, producing a low of 642.00 within mere hours. I’m not so confident that gold is about to come roaring back, but as for crude oil, only a skip-and-go-naked optimist such as the kind who appear regularly on CNBC could possibly believe the worst is over.
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Vancouver Seminar
We’ve engaged the Pan Pacific Hotel (pictured above) for the Vancouver seminar in late October, promising an event that will be just as enjoyable for spouse and kids as for attendees. The facility is central to many of the amenities that make Vancouver such a great town. If you’re interested and haven’t contacted me yet, please let me know via-email . Is this seminar for you? Here’s the prospectus:
Trust Yourself,
Not Some Guru
Would you like to be able to forecast trends and price swings so accurately that you’ll never again have to seek advice from the supposed experts? That is the goal of the Hidden-Pivot Seminar: to teach you to read the markets so confidently that you will come to trust your own judgment over that of gurus who forecast for a living.
My proprietary Hidden-Pivot Method derives from a few simple principles that I’ve developed and honed over the last twelve years. It is the simplest and most powerful method I have ever found for predicting trends and price swings accurately and with complete confidence. Moreover, it works in any time frame and for virtually all types of securities, including stocks, indexes, commodities and options.
Inhale…Exhale
The system is based on the theory that stocks and commodities are constantly trying to balance yin and yang energy as they move around. Their ups and downs are analogous to breathing in and breathing out, and in the end these complementary actions must offset each other precisely. The trick to understanding how the process works in the securities markets is to visually match up trend segments that are part of ABCD patterns on charts.
Consider as an example the chart of eBay below. The key number is 28.89, the presumptive D target of a pattern defined by points A, B and C. The target is what I call a “hidden pivot,” and it is calculated by subtracting the length of the A-B segment (3.90) from point C. In the example, the resulting value is 28.89, a mere two cents from where eBay actually turned. In retrospect, we see that this would have been an excellent spot to buy the stock using a stop-loss as tight as a nickel. It also would have provided a precise target to enable disciplined short-covering.
A Simple Trick
The visual trick to identifying these patterns is really no trick at all. You simply find the B-C leg first, then move backwards to locate A. Those three price points are all you will need to calculate a D target. Note that the B-C leg is simply any countertrend move that looks like it might eventually be the axis of symmetry dividing an AB impulse leg from a CD follow-through leg.
That’s all there is to it. Since the system is based entirely on price action, you won’t ever have to consider trading volume, oscillators, channels, MACDs, trendlines or any of the other conventional indicators that most technicians use. And with just one more trick, you will be capable of forecasting as accurately as those who do it for a living. You need only locate the exact midpoint of the B-C segment’s second leg. Once you are able to find this specially endowed hidden pivot – a simple task for the trained eye – you will never again need an “expert” to tell you what a stock, index or commodity is likely to do next.
The Hidden Pivot Seminar is held over two days, during which time you will learn how to spot the most promising ABCD patterns. You will also learn, in under 20 minutes, a surprisingly easy way to use stochastic indicators and other oscillators to enhance your timing. Finally, you will learn how to use hidden pivots to manage risk so that you will always know exactly when to cut losses and when to let profits run.
Free Mentoring
An important feature of the seminar, at no extra cost, is post-grad mentoring in a hidden-pivot chat room set up by some of my students. Here is what one of them, Hunter Reynolds, recently had to say: "We have all come a long way. I think everyone here is making a little $$, or we would be doing something else by now. I can honestly say I am up about ten percent, maybe a little more, since your class. I am pretty conservative. I just trade from the long side, but I'm getting really good at picking the hidden-pivot reversal points for the uptrend!"
I should tell you that seminar grads who frequent the chat room are coming to understand my method as well as I do. Indeed, some have adapted what they learned in highly effective ways that I could not have foreseen. Buttressed by the continuing lessons of the chat-room, the Hidden Pivot Seminar offers an opportunity to acquire powerful analytical tools that will serve you for a lifetime.
