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August 8, 2017 | Bulls Getting Smacked Down with Increasing Regularity

Rick Ackerman

Rick Ackerman is the editor of Rick’s Picks, an online service geared to traders of stocks, options, index futures and commodities. His detailed trading strategies have appeared since the early 1990s in Black Box Forecasts, a newsletter he founded that originally was geared to professional option traders. Barron’s once labeled him an “intrepid trader” in a headline that alluded to his key role in solving a notorious pill-tampering case. He received a $200,000 reward when a conviction resulted, and the story was retold on TV’s FBI: The Untold Story. His professional background includes 12 years as a market maker in the pits of the Pacific Coast Exchange, three as an investigator with renowned San Francisco private eye Hal Lipset, seven as a reporter and newspaper editor, three as a columnist for the Sunday San Francisco Examiner, and two decades as a contributor to publications ranging from Barron’s to The Antiquarian Bookman to Fleet Street Letter and Utne Reader.

Index futures were continuing to sell off Tuesday night after having peaked intraday at levels where we’d anticipated a top of possible importance. Specifically, I’d flagged two rally targets that lay, respectively, at 2486.75 and 2489.50. Together, these Hidden Pivot resistance points stopped a strong rally in the first half of the session at 2488.50, then sent the futures into a dive that has reached 2461.50 so far this evening.

Although Rick’s Picks subscribers were able to take partial profits on short positions initiated at or very near the top, I would caution bears about celebrating prematurely. My concern is that the shares of two supremely important stock-market bellwethers, Amazon (see chart inset) and Boeing, were hanging tough Tuesday night after having barely sold off during the day.

This divergence will not necessarily settle in bulls’ favor, but it may take a day or two before we can predict confidently who will win. Regardless, from a Hidden Pivot perspective something important has changed in the way stocks are acting. Instead of hitting or slightly exceeding bullish targets and pulling back lazily for a short while, stocks are reaching their targets exactly and then getting smacked down hard.  The inescapable conclusion is that buyers are feeling less feisty these days — for whatever reason.

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August 8th, 2017

Posted In: Rick's Picks

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