Ricks Picks header image
The Morning Line

With Bloomberg Running, It’s a New Race

Although a Warren victory would be an unqualified disaster for the stock market and, arguably, for America, it’s harder to imagine what a Bloomberg presidency might look like. The left-leaning billionaire entered the race on Friday by filing for the Alabama primaries. This is a change of heart from a few months ago, when the news mogul announced he had no plans to run. He has stepped in because he’s concerned that none of the leading Democrats could beat Trump. He may be right, especially since Warren shot herself in the foot — and  chest, and head — last week by spelling out exactly how she would pay for ‘Medicare for All’.

How’s That Again, Liz?

If there were any doubts that her ideas were hatched in the fever swamps of socialism, they have been dispelled by what she revealed of Warrencare. For starters, and as we already knew, everyone in America with an employer-based health plan would lose it. Billionaires like Bloomberg supposedly would pay for it, but if funding came up short, policy tweaks would make up the difference. How’s that again?  Here’s Warren in her own wonky words: “I will use available policy tools, which include global budgets, population-based budgets and automatic rate reductions to bring it back in line.” Are you reassured? Even Piketty, the French leftist whose ideas Warren has borrowed from promiscuously and plagiarized, must be embarrassed by such claptrap.

Bloomberg, at 77, is a year younger than Sanders but robust and seemingly in good health, so age would not be a major factor. He could run a much better race against Trump than any of the current Democratic frontrunners — Warren, Sanders, Biden and Buttigieg. Unlike them, although Bloomberg is a meddlesome liberal who would want to intrude heavily on every area of our lives, including our diets, he is at least no loony leftist like most of the Democratic candidates.  He is in fact very much a capitalist, for better or worse, and so Wall Street undoubtedly could live with him. If he were to win the election, the bull market probably wouldn’t miss a beat, assuming it was still chugging along a year from now. An added plus — for America and all mankind — is that a Bloomberg run would probably drive a stake through the heart of any Hillary candidacy, ending her political career once and for all

Rick's Picks for Friday
$ = Actionable Advice + = Open Position
List of Symbols to use in Search:

+GCZ19 – December Gold (Last:1418.00)

0 comments


Rick’s Picks Member-only content.You must be logged in to view this post

$AAPL – Apple Computer (Last:1770.00)

0 comments


Rick’s Picks Member-only content.You must be logged in to view this post

TNX.X – Ten-Year Note Rate (Last:1.933%)

0 comments

Although some notable long-term bond bulls are close to throwing in the towel as U.S. Treasury yields continue to climb, the chart suggests the bull market begun nearly 40 years ago still has farther to go.  Yields on the long bond settled Friday at 2.41%, up from 1.90% in August, while T-Notes have gone from 1.43% to 1.93% over the same time. The rallies have been impressive if not to say scary, since they have subjected hundreds of trillions of dollars of borrowings to a deflationary turn of the screw. The burden of debt promises to lighten before it becomes fatal , however, when the uptrend in interest rates reverses.

Is This a Good Thing?

Hidden Pivot analysis says relief could come soon, with the 10-Year topping at 1.984% and the 30-Year at 2.477%. How far might they fall thereafter?  My forecast calls for major lows at, respectively, 0.84% and 1.64%. This implies that the negative-rate weirdness of Europe will not afflict U.S. debt. Is this a good thing? Don’t ask the ‘experts’, because they don’t understand negative yields any better than the news media hacks who write about it.  Sub-zero yields reflect the central banks’ increasingly desperate efforts since the 1990-91 recession to avoid a catastrophic deflation. Predicting they will fail is not exactly rocket science, even if not one observer in a hundred expects this.

This is a free forecast (Tout) by Rick. Get a free trial of Rick’s Picks to see full member content.

$VXX – S&P VIX Short-Term (Last:18.64)

0 comments


Rick’s Picks Member-only content.You must be logged in to view this post

$ESZ19 – December E-Mini S&P (Last:3083.75)

0 comments


Rick’s Picks Member-only content.You must be logged in to view this post

$+AMZN – Amazon (Last:1771.90)

0 comments

As predicted, AMZN easily recouped losses incurred during last week’s shakedown on earnings news. DaBoyz used the dog-bites-man story of the month — Same-Day Deliveries Crimp Profits! — as an opportunity to steal shares from widows and pensioners at fire-sale prices. The trampoline bounce that ensued has tripped a theoretical buy signal at the green line (1773.79) and put p2=1862.52 in play as a minimum upside objective for the near term.  The target looks like it’s in-the-bag, but call options are too juiced to offer much edge. _______ UPDATE (Nov 5, 5;35 p.m. EST): A so-far mellow correction off Monday’s 1815 high looks bound for p=1796.88, or 1787.25 if any lower  (60-minute, a= 1813.25 on 11/5 at 6:00 a.m.). _______ UPDATE (Nov 6, 11:04 p.m.): The selloff reversed from 1788.58, just $1.33 from the correction target given above. The first rally resistance lies at 1803.45 (5-min, A= 1785.52 on 11/1 at 3:05 p.m.) _______ UPDATE (Nov 7, 8:46 a.m.): DaBoyz gapped AMZN past p=1803.45 on zero volume at 5:00 a.m. Nice work, guys. This means D=1818.12 is, like, 99% likely to be reached, probably sooner rather than later. ______ UPDATE (Nov 11, 9:28 p.m.): If AMZN continues to fall, you can use this 1754.35 target to bottom-fish.

This is a free forecast (Tout) by Rick. Get a free trial of Rick’s Picks to see full member content.

$GDX – Gold Miners ETF (Last:26.49)

0 comments

We gutted it out last week to stay long through a swoon that left GDX little changed from a week earlier. The partial profit we took on half the position gives us 200 shares with an adjusted cost basis of 26.77. Friday’s punk performance lagged physical gold, which was up nearly $5 at one point. GDX never went ‘green’, but it is not likely sit still if bullion’s rally resumes or picks up steam in the week ahead.  In any event, offer 100 shares to close for 28.60, o-c-o with a stop-loss on the position at 26.78. If GDX takes out the 26.18 point ‘C’ low of the pattern, we’ll look to re-enter at the first good opportunity. _______ UPDATE (Nov 7, 10:54 p.m.): We were stopped out at 26.78 for no loss or gain. GDX has yet to break down as badly as gold futures, although this will come as scant consolation to those who’ve held a long position in this vehicle. I’ll recommend waiting for a washout down to this 25.22 target before buying. We can adjust if GDX reverses without falling that far.

This is a free forecast (Tout) by Rick. Get a free trial of Rick’s Picks to see full member content.

$DXY – NYBOT Dollar Index (Last:98.37)

0 comments

I rarely update my dollar forecast because 1) my very-long-term outlook is unshakably bullish, and 2) subscribers do not trade it. Nevertheless, the dollar sold off hard last month, raising mild concerns about whether the long-tern trend has changed. A glance at the weekly chart, however, reveals little technical damage. Regardless, I’ll need to start treating the chart as I would some trading vehicle I don’t care about. Strictly speaking, a further decline touching the green line would put p=92.67 in play as a downside target. I refer to it as my worst-case scenario in the chart, but in fact 85.67, the pattern’s ‘D’ target, would be the actual worst-case possibility. That is unimaginable to me, and so I’ve put it out of mind.  ‘Impossibilities’ aside, I’ll be watching for ‘counterintuitive’ buying signals each time DXY takes out a new low on the weekly chart. The nearest of them lies at 97.03, and thence at 95.84. _______ UPDATE (Nov 8): Interesting that a market as vast as the dollar should rally following a cheesy fake-out low that exceeded a previous one by a few cents.  That is what has happened, however, as this chart makes clear.  The rally we look more sincere if and when it exceeds the external peak at 98.65.

This is a free forecast (Tout) by Rick. Get a free trial of Rick’s Picks to see full member content.

$+BRTI – CME Bitcoin Index (Last:9239)

0 comments

I’ve been trying to avoid this vehicle, since it stirs up craziness in the trading room. That said, a pullback to x=7609 would trigger a textbook ‘mechanical ‘ buy.  Hard to ignore? Not for me, since the nearly $4500 initial risk is scary no matter how you slice it.  I’m putting out this advisory for informational purposes anyway, but if I hear from at least two subscribers who do the trade (this will be on the honor system), I’ll make it official by establishing a tracking position. Little further guidance would be needed, since winning would be a simple matter of gutting it out. Your stop-loss would be just beneath C=3134, with p=12,083 as a minimum objective.  Please let me know in the trading room if you’re a player. Good luck! ______ UPDATE (Oct 5): Paypal has dropped out of Facebook’s Libra cryptocurrency experiment, so don’t be surprised if the ‘mechanical’ buy at 7609 triggers soon. It missed by an inch on the last selloff. ______ UPDATE (Oct 10, 10:50 p.m.): Bitcoin has turned pathetic again. I’ll leave the tout up for a while anyway because the dip to 7719 came so close to signaling the ‘mechanical’ buy noted above that we could consider the trade as having triggered. _______ UPDATE (Oct 24, 6:50 p.m.): The nasty selloff from late June’s 13855 high has finally triggered the ‘mechanical’ buy signal noted above.  This type of trade works best in vehicles that move violently, but I’d suggest watching from the sidelines, since, with a stop-loss at 3133,  the initial theoretical risk would be $4475. A less risky place to attempt entry would be at the 6166target of the smaller ABC pattern shown here. The long-term rally target associated with the 7609 buy signal is 21,032. _______ UPDATE (Oct 29, 8:30 a.m.): The buy signal triggered on Oct 23; two days later, BRTI embarked on a $2600 rally, its strongest since last year. If you climbed aboard, you should take a fat partial profit. No one reported doing the trade, but if I hear from at least three subscribers who did, I’ll establish a tracking position. _______ UPDATE (Nov 2, 3:50 p.m.): Some ‘experts’ wrote last week that $10,000 resistance looks all but impenetrable, but I would disagree. In any event, we’ll use a trailing stop if and when bitcoin pushes above $1ok, so stay tuned for details if you care.

This is a free forecast (Tout) by Rick. Get a free trial of Rick’s Picks to see full member content.