-- Posted Wednesday, 14 May 2008 | Digg This Article
| Source: GoldSeek.com
Rick’s Picks
Wednesday, May 14, 2008
“Phenomenally accurate forecasts”
Yesterday’s headline implied that it might be time for bears to take a vacation, but perhaps the mental health of bulls too might benefit if they “go away in May.” Seasonality will favor longer lapses of tedium on the nation’s bourses in the months ahead, but on Wall Street that is surely no remedy for hypertension. Quite the opposite, in fact, since prolonged stretches of sideways price action are almost as stressful as the number one killer of money managers, bear markets. Below is a chartist’s version of atrial fibrillation at work, straining the heart and arteries of anyone so foolish as to be trading the E-Mini S&P yesterday:
For our part we just watched, having lucked out overnight with a target that caught the bottom in June Crude within 12 cents. Here’s the advice for oil traders that went out to Rick’s Picks subscribers Monday evening, when quotes for Texas tea were hovering just below $124 : “There are some bullish targets near 131 given here earlier, but we'll put them aside for now, since the futures look primed for a fall to at least 123.22, or to 122.25 if any lower. Either can be bottom-fished with a stop-loss as tight as you can abide.”
The actual intraday low occurred at 123.10, so a 15-cent stop-loss would have survived our advice. The subsequent rally proved quite robust, hitting 124.19 about three hours later in the dead of night. But it took a nimble hand, iron nerves and quick reflexes to convert the recommendation into lucre, as one chat-room denizen appears to have done, since the June contract dropped like a brick after the rally apexed. Even so, the original low where we’d gotten in held, producing a second rally to 126.02. But by then, anyone in aboard near the overnight bottom would have been far from the madding crowds, fondling a StressEraser and counting sheep.
Hidden Pivot targets aside, we were somewhat surprised to see oil rebound as strongly as it did. The daily chart has been looking somewhat heavy, and the trajectory of crude’s rally looks too steep to sustain for much longer. But we do have higher targets outstanding, and that has tempered our enthusiasm for playing the short side of the move. Parabolas always ended badly for investors, and the one in crude will be no exception, We see quotes falling by 40% to 50% when the break finally comes. Let’s hope it comes by summer, though, since gas could be $5 at the pump by Labor Day if oil continues to rise at the current rate.
***
Reserve Your Seat Now
Because seats for the recent Hidden Pivot seminar were nearly sold out, I’m offering the course again on May 21-22, from 6 p.m. to 9 p.m. Mountain Time. Click here, and then on the “Upcoming” tab to register; or here if you would like more information as well as a detailed description of the Hidden Pivot Method and a free Hidden Pivot calculator (our latest model, perfect for beginners).
***
Get a Chat-Room Pass
The Rick’s Picks chat room is the place to be if you’re looking for tradable ideas in real time. Gold and silver traders in particular can benefit, since the room attracts experienced traders from all over the world at all hours of the day, particularly during U.S. market hours. If you would like a free one-day pass to check it out, click here, and then on the green banner.
***
Information and commentary contained herein comes from sources believed to be reliable, but this cannot be guaranteed. Past performance should not be construed as an indicator of future results, so let the buyer beware. Rick's Picks does not provide investment advice to individuals, nor act as an investment advisor, nor individually advocate the purchase or sale of any security or investment. From time to time, its editor may hold positions in issues referred to in this service, and he may alter or augment them at any time. Investments recommended herein should be made only after consulting with your investment advisor, and only after reviewing the prospectus or financial statements of the company. Rick's Picks reserves the right to use e-mail endorsements and/or profit claims from its subscribers for marketing purposes. All names will be kept anonymous and only subscribers’ initials will be used unless express written permission has been granted to the contrary. All Contents © 2008, Rick Ackerman. All Rights Reserved. www.rickackerman.com
-- Posted Wednesday, 14 May 2008 | Digg This Article | Source: GoldSeek.com
