-- Posted Friday, 11 July 2008 | Digg This Article
| Source: GoldSeek.com
Rick’s Picks
Friday, July 11, 2008
“Phenomenally accurate forecasts”
Hope sprang eternal in the Rick’s Picks chat room yesterday that crude oil’s big surge would somehow send stocks plummeting. Alas, it was not to be. Short-covering persisted throughout the day, pushing the Dow Industrials to a yet another undeserved gain – in this case, 82 points. Bearish hopes had doubtless been inspired by a 1218.00 target we’d proffered for the E-mini S&P. The target implied a decline of about 27 points, equivalent to around 250 points in the Industrial Average. Instead, the S&P futures bounced twice during the day from just above the previous day’s lows, hinting that traders were not about to be embarrassed by having their lack of imagination and daring put on global display.
Was there perhaps some news out that would explain the stock market’s perverse behavior? The big story of the day concerned a second test by Iran of medium- and long-range missiles. This was surely responsible for most of crude’s more than $5 gain yesterday, but it could hardly have been the cause of the rally in the broad averages. Perhaps we should simply accept the time-tested wisdom of chartists that holds that stocks will rally whenever they are ready to rally no matter what the news.
Tit for Tat
The scariness of Iran’s missile maneuvers may have been mitigated by the fact that Israeli fighter jets had performed heavily symbolic maneuvers of their own a few weeks back. “Tit-for-tat” therefore seems a more plausible explanation than that the two countries are planning to go to war. This is notwithstanding the Ayatollah’s somewhat churlish statement on Tuesday that Tehran would "set fire" to Israel and the US navy in the Gulf in response to any American attack over its nuclear program. This threat did not appear to rattle the U.S. brass. Asked if the two countries were closer to a military confrontation in light of the escalating rhetoric, Defense Secretary Gates said, "No I don't think so. The reality is there is a lot of signaling going on, but everybody recognizes what the consequences of any kind of a conflict would be," he said.
It would seem that the doctrine of Mutually Assured Destruction has returned to play a role in Middle East affairs. Or so we should hope. As the defense secretary has implied, everyone does indeed recognize that the consequences of armed conflict between Israel and Iran are almost too grave to contemplate.
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Last Chance to Register
Because of family vacation plans, I will be able to offer the Hidden Pivot Seminar only once this summer – on two consecutive weekday evenings, July 23-24. If you’ve been thinking about signing up, now is the time to do it, since once this class is full there will not be another opportunity to take it until fall. 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).
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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 Friday, 11 July 2008 | Digg This Article | Source: GoldSeek.com
