-- Posted 2 March, 2006 | | Source: SilverSeek.com
Rick’s Picks
Friday, March 3, 2006
For investors who’d rather be smart than lucky
Is the long bond about to break down? John B., a subscriber who has taken an active interest in hidden pivots, studied a weekly bond chart like the one below and that’s what he concluded. Take a look for yourself and see if you agree:
“T-Bonds appear to be on the verge of breaking down,” he writes. “I may be all wet, but I was looking at the weekly March T-Bond chart and saw an ABCD pattern started last September that has violated the midpoint of its CD ‘follow-through’ According to your rules, that means it’s likely to complete the pattern by falling all the way to D at 107^15 – a 4 percent decline from these levels. If that’s the case, look out below for stocks and real estate. Am I reading this wrong?”
I read it somewhat differently, John, and although I see little to celebrate, I am not so pessimistic as you. Although bond prices have been falling since last June, the bearish AB “impulse leg” that you’ve measured is not what I’d call a killer wave. If it were, implying significantly lower prices ahead, the indicated point ‘B’ low would have surpassed the 109^00 low made in March of last year.
That said, one could make the case that a large head-and-shoulders pattern has been forming for the last year-and-a-half. That would have negative implications, of course, but even if so, it will probably take another six to eight weeks to reach the danger threshold of the still incomplete right shoulder.
We’ll know before then whether this pattern is the real McCoy, since it would have to breach that 109.00 low mentioned above before it becomes truly threatening from a hidden-pivot perspective. Moreover, this would have to occur without an upward retracement of more than a week’s duration once ‘B’ has been penetrated. If the bear were to stumble any more significantly than that, it would imply that investors have little to fear, at least for the intermediate term.
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Hi-Ho Silver!!!
For those of you who missed yesterday’s intraday bulletin on Comex Silver, here it is: May Silver has blown past the 10.160 rally target I gave here a while back. Since the next hidden-pivot resistance above is 10.270, we'll make that our minimum upside projection for the very near-term. I am confident the intermediate-term bull cycle begun in December will reach a minimum 10.776 before it takes a healthy rest.
In fact, Silver surged anew after I posted this alert, pushing as high as 10.265 – a half-cent from my target – in early-night trading. We covered a very small short position in Agnico Eagle just before the surge.
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Information and commentary contained herein comes from sources believed to be reliable, but this 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 © 2006, Rick Ackerman. All Rights Reserved. www.rickackerman.com
-- Posted 2 March, 2006 | |
