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-- Posted Sunday, 10 August 2008 | Digg This Article | Source: GoldSeek.com
Rick’s Picks Monday, August 11, 2008 "Phenomenally accurate forecasts" We sometimes forget that whenever the stock market misbehaves with breathtakingly bizarre perversity, that it is merely punishing traders who harbor fantasies of reaping easy profits by doing the obvious. Friday, for instance. Before the opening bell, Fannie Mae shares were getting slaughtered on news of huge new write downs, and full-blown war was erupting between Georgian Russia and a well-armed army of Moscow-backed separatists. In Pakistan, Musharraf’s by-now fragile stand against chaos was being threatened by impeachment. And yet, with all these new troubles to beset an already gravely troubled world, index futures were down only fractionally -- revving up for what turned out to be spectacular gains on the day. 
No less surreal was that gold futures, brain-dead as always to geopolitical tensions, were getting hammered, plummeting to within easy distance of an 850.10 target we’d been using to keep us profitably aligned with the opaque stupidity of the mindless herd. This perversely bullish tableau for a powerful stock-market surge was irresistible, and we said so in the chat room just before the opening bell: "[E-Minis] trading 10 points beneath overnight lows, strongly against expectations...and reality. Suggests DaBoyz are keen on buying 'em this morning." And boy were they ever! Within an hour, the Industrial Average was up 216 points, on its way to a 303 point gain. And celebrating…what? The economic survival of our planet for yet one more precious day? Easy to Predict Ironically, the stock market has never been easier to read. Predicting its movements each day would be far more difficult if price action were tied in some discernible way to the observable facts of the real world. But in actuality, the stock market has come to be 99% dominated by short-term traders, and so, the more obvious the bullishness or bearishness of the news at any given moment, the more confident we can be that stocks will react opposite from what we should expect. Thus, when the shares of Exxon Mobil got slammed on a day when the company reported the biggest quarterly earnings in human history, we can only infer, not that traders were disappointed, as the financial-show bozos had it, but that all of the buying in anticipation of spectacular earnings had been done before the earnings were announced. So what does such nuttiness portend most immediately for stocks in general and for precious metals in particular? These questions are addressed in specific detail in my trading recommendations for Monday. Many of the gold bugs who frequent the Rick’s Picks chat room had been looking for a washout in gold and silver to provide one last, fabulous buying opportunity before precious metals head for the promised land. And perhaps they will. But we have already explained why the major trends, driven mainly by collapsing oil prices, can continue for quite a while. In any event, the main purpose of Hidden Pivot analysis is to allow us to exploit opportunities without getting schmeissed if we are wrong. Most recently, coldly dispassionate analysis saved us from buying into a $70 decline in gold and an even steeper one in Silver. (Note: We initiated a tightly stopped long position in September Silver on Friday when the futures bottomed a single tick from the low we’d projected, a Hidden Pivot support at 15.245.) Precious-metal bulls keen on speculating on a bottom here should tune not only to the touts, but to the Rick’s Picks chat room, which has been attracting some very savvy players from UK, India, Australia and all over the world.
*** 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 Sunday, 10 August 2008 | Digg This Article | Source: GoldSeek.com
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