Serpo
30th October 2012, 03:01 AM
http://news.goldseek.com/GoldSeek/1351609200.php
something for the tech heads.......
Timing the Gold Bull
-- Posted Tuesday, 30 October 2012 | Share this article (http://news.goldseek.com/GoldSeek/1351609200.php) | Source: GoldSeek.com
Dreaming the impossible dream
The question of when gold’s long awaited ascent will happen is not without precedence. A similar question is still being asked by the Jews concerning the appearance of the Messiah. Prediction has always been an inexact science.
TIMING MARKETS AND TIMING GOLD
http://67.19.64.18/news/2012/10-29ds/1.jpg
In my book, Time of the Vulture, How to Survive the Crisis and Prosper in the Process (http://www.drschoon.com/bookstore.asp), I quote market timer and industry insider, Rick Ackerman:
…the stock market is a rigged game… It really is just a giant carny game, one in which there are only predator and prey, and precious few big winners. Wall Street’s best and brightest may have more teeth and fewer tattoos than carny men, but they employ essentially the same skills in separating the gullible from their hard-earned dollars. Both try to convince us that “Everybody goes home a winner!” even though we know better. We always imagine ourselves winning the big stuffed panda, even though we know we’ll be lucky to take home a pack of Marlboros or a Luke Skywalker keychain
Ackerman’s cynical comments are a result of Ackerman’s 12 years experience as a market maker on the floor of the Pacific Stock Exchange. That markets are rigged, however, doesn’t mean that hedged, educated and often accurate predictions cannot be made. In fact, Ackerman’s newsletter, Rick’s Picks (http://www.rickackerman.com/), purports to do just that.
I first became aware of Ackerman’s refreshingly cynical market commentary in the 1990s when he wrote a financial column for the San Francisco Chronicle. It was not, however, until ten years later that I became aware of Ackerman’s sometimes astounding accuracy.
Using a proprietary technical methodology Ackerman calls ‘hidden-pivots’, Ackerman predicts tops and bottoms, i.e. turning points, for all markets, i.e. commodities, treasuries, stocks, etc; and, in 2006 we had an opportunity to see what Ackerman’s hidden-pivots could do.
In 2006, we were holding warrants issued by Agnico-Eagle Mines. Warrants on gold mining shares can often be more volatile than profitable. In March 2006, our warrants had lost 2/3 of their value before gold suddenly began moving upwards, increasing exponentially the value of our warrants in a very short period of time.
Warrants, by definition, are time-dependent giving buyers the option for a limited time to purchase underlying shares at a predetermined price; and as gold began rising in 2006, the question became, what would be gold’s top before it turned down?
Gold had started its rise in mid-March at $535. In April, it moved up past $600 and by the end of the month was nearing $700. The hidden-pivot Ackerman predicted for gold’s turning point was $715.50 and I remember watching gold’s daily move towards Ackerman’s hidden-pivot.
In early May, gold crossed $700. Then on May 11th, gold exceeded Ackerman’s hidden-pivot during inter-day trading before dropping to end exactly at $715.50, Ackerman’s hidden pivot. The next day, gold rose to $725.00 before beginning a multi-week decline.
On May 12th, we sold our warrants and that summer flew to New York to attend Ackerman’s hidden pivot seminar. We wanted to know how anyone could predict with that degree of accuracy, gold’s then top; and, at the seminar, Ackerman explained how he had come by his methodology and how it worked.
Today, when I was referencing Ackerman’s website, in his October 29thnewsletter, Ackerman explained his methodology in About the Hidden Pivot Method (http://www.rickackerman.com/about-the-hidden-pivot-method/):
The method I use to forecast swing points and trends is the most accurate and powerful I’ve discovered in 30 years of trading. It is also by far the simplest, requiring little more than junior high school math to do the necessary calculations. I first learned about this amazingly precise method of analysis from a floor trader on the Pacific Stock Exchange named Ira Tunik. At the time, Ira was using the cycles work of J.M. Hurst, a pioneer in the field of technical analysis, to make a very good living on the options floor. When he retired as a pit trader in the late 1980s, he shifted his nest egg mostly into bonds, which at the time were providing annualized returns approaching 10 percent. However, when interest rates began to decline from those cyclical peaks, Ira realized he would need a foolproof trading strategy to live well off his savings without having to dip into principal.
http://67.19.64.18/news/2012/10-29ds/2.jpg
How does the system work? To start with, I always try to visualize the price movement of stocks, commodities, options and indexes in the perspective of an ABCD pattern such as the one shown above. Unlike Elliott Wave Theory, which is rooted in trend patterns with five legs and corrections with three, my method distills all of the action down to three legs. It also sidesteps the often daunting task of distinguishing corrections from trend moves. Those who are familiar with Elliott Wave Theory know that even EWT experts sometimes bog down in the choppy seas of corrective patterns. Terms such as expanded flats, extended or truncated fifths, double and triple threes, zigzags, and contracting, ascending and descending triangles are all part of Elliott Wave terminology, and they must all be mastered by the chartist who would attempt to forecast accurately and profitably. However, Hidden Pivot strategies, on the other hand, shun such complexities, focusing instead on the most fundamental rhythms of the market. If you can distinguish good art from bad, you can learn the Hidden Pivot Method.
Nothing can be predicted with 100% accuracy and Ackerman doesn’t make that claim. Heisenberg’s Uncertainty Principal is far too ubiquitous a truth for that to occur. Nonetheless, for those not yet committed to buy and hold gold and silver for the long term, Ackerman offers a viable alternative to investing in increasingly unpredictable markets.
Caveat: Ackerman’s methodology requires a sustained concentration that I don’t possess. You may.
THE FUTURE
Buckminster Fuller was described as a futurist. Of that future, Fuller wrote in 1981 that the world’s power structures were about to collapse; but, in that collapse, humanity’s vast resources would become available on a scale never before experienced.
The introduction to Fuller’s The Critical Path was titled Twilight of the World’s Power Structures, Fuller wrote: …the world’s power structures have always “divided to conquer” and have always “kept divided to keep conquered.”
As a consequence the power structure has so divided humanity—not only into special function categories but into religious and language and color categories—that individual humans are now helplessly inarticulate in the face of the present crisis. They consider their political representation to be completely corrupted; therefore they feel almost utterly helpless. (1981)
Buckminster Fuller believed, however, that it was not political and economic systems that needed examination. It was ourselves; that as individuals we needed to examine our own integrity.
…When we speak of the integrity of the individual, we speak of that which life has taught the individual by direct experience. We are not talking about loyalty to your mother, your friends, your college fraternity, or your boss, who told you how to behave or think. In speaking of truth, we are not talking about the position to take that seems to put you in the most favorable light.
If we want the future to be a better future we must be that better future ourselves. Expecting it to be otherwise is as self-deceiving as it is futile. These are significant times. Expecting politicians to provide us with answers will leave us with none.
My current youtube videos are Today’s crisis: The 1930s Magnified (http://youtu.be/e-fGq07eekg) and The Mystery of my Writing: Time of the Vulture, etc (http://youtu.be/0y8vPPNxKo8).
Buy gold, buy silver, have faith.
Darryl Robert Schoon
www.survivethecrisis.com (http://www.survivethecrisis.com/)
www.drschoon.com (http://www.drschoon.com/)
Timing the Gold Bull
...........
-- Posted Tuesday, 30 October 2012 | Share this article (http://news.goldseek.com/GoldSeek/1351609200.php) | Source: GoldSeek.com
Dreaming the impossible dream
The question of when gold’s long awaited ascent will happen is not without precedence. A similar question is still being asked by the Jews concerning the appearance of the Messiah. Prediction has always been an inexact science.
TIMING MARKETS AND TIMING GOLD
http://67.19.64.18/news/2012/10-29ds/1.jpg
In my book, Time of the Vulture, How to Survive the Crisis and Prosper in the Process (http://www.drschoon.com/bookstore.asp), I quote market timer and industry insider, Rick Ackerman:
…the stock market is a rigged game… It really is just a giant carny game, one in which there are only predator and prey, and precious few big winners. Wall Street’s best and brightest may have more teeth and fewer tattoos than carny men, but they employ essentially the same skills in separating the gullible from their hard-earned dollars. Both try to convince us that “Everybody goes home a winner!” even though we know better. We always imagine ourselves winning the big stuffed panda, even though we know we’ll be lucky to take home a pack of Marlboros or a Luke Skywalker keychain
Ackerman’s cynical comments are a result of Ackerman’s 12 years experience as a market maker on the floor of the Pacific Stock Exchange. That markets are rigged, however, doesn’t mean that hedged, educated and often accurate predictions cannot be made. In fact, Ackerman’s newsletter, Rick’s Picks (http://www.rickackerman.com/), purports to do just that.
I first became aware of Ackerman’s refreshingly cynical market commentary in the 1990s when he wrote a financial column for the San Francisco Chronicle. It was not, however, until ten years later that I became aware of Ackerman’s sometimes astounding accuracy.
Using a proprietary technical methodology Ackerman calls ‘hidden-pivots’, Ackerman predicts tops and bottoms, i.e. turning points, for all markets, i.e. commodities, treasuries, stocks, etc; and, in 2006 we had an opportunity to see what Ackerman’s hidden-pivots could do.
In 2006, we were holding warrants issued by Agnico-Eagle Mines. Warrants on gold mining shares can often be more volatile than profitable. In March 2006, our warrants had lost 2/3 of their value before gold suddenly began moving upwards, increasing exponentially the value of our warrants in a very short period of time.
Warrants, by definition, are time-dependent giving buyers the option for a limited time to purchase underlying shares at a predetermined price; and as gold began rising in 2006, the question became, what would be gold’s top before it turned down?
Gold had started its rise in mid-March at $535. In April, it moved up past $600 and by the end of the month was nearing $700. The hidden-pivot Ackerman predicted for gold’s turning point was $715.50 and I remember watching gold’s daily move towards Ackerman’s hidden-pivot.
In early May, gold crossed $700. Then on May 11th, gold exceeded Ackerman’s hidden-pivot during inter-day trading before dropping to end exactly at $715.50, Ackerman’s hidden pivot. The next day, gold rose to $725.00 before beginning a multi-week decline.
On May 12th, we sold our warrants and that summer flew to New York to attend Ackerman’s hidden pivot seminar. We wanted to know how anyone could predict with that degree of accuracy, gold’s then top; and, at the seminar, Ackerman explained how he had come by his methodology and how it worked.
Today, when I was referencing Ackerman’s website, in his October 29thnewsletter, Ackerman explained his methodology in About the Hidden Pivot Method (http://www.rickackerman.com/about-the-hidden-pivot-method/):
The method I use to forecast swing points and trends is the most accurate and powerful I’ve discovered in 30 years of trading. It is also by far the simplest, requiring little more than junior high school math to do the necessary calculations. I first learned about this amazingly precise method of analysis from a floor trader on the Pacific Stock Exchange named Ira Tunik. At the time, Ira was using the cycles work of J.M. Hurst, a pioneer in the field of technical analysis, to make a very good living on the options floor. When he retired as a pit trader in the late 1980s, he shifted his nest egg mostly into bonds, which at the time were providing annualized returns approaching 10 percent. However, when interest rates began to decline from those cyclical peaks, Ira realized he would need a foolproof trading strategy to live well off his savings without having to dip into principal.
http://67.19.64.18/news/2012/10-29ds/2.jpg
How does the system work? To start with, I always try to visualize the price movement of stocks, commodities, options and indexes in the perspective of an ABCD pattern such as the one shown above. Unlike Elliott Wave Theory, which is rooted in trend patterns with five legs and corrections with three, my method distills all of the action down to three legs. It also sidesteps the often daunting task of distinguishing corrections from trend moves. Those who are familiar with Elliott Wave Theory know that even EWT experts sometimes bog down in the choppy seas of corrective patterns. Terms such as expanded flats, extended or truncated fifths, double and triple threes, zigzags, and contracting, ascending and descending triangles are all part of Elliott Wave terminology, and they must all be mastered by the chartist who would attempt to forecast accurately and profitably. However, Hidden Pivot strategies, on the other hand, shun such complexities, focusing instead on the most fundamental rhythms of the market. If you can distinguish good art from bad, you can learn the Hidden Pivot Method.
Nothing can be predicted with 100% accuracy and Ackerman doesn’t make that claim. Heisenberg’s Uncertainty Principal is far too ubiquitous a truth for that to occur. Nonetheless, for those not yet committed to buy and hold gold and silver for the long term, Ackerman offers a viable alternative to investing in increasingly unpredictable markets.
Caveat: Ackerman’s methodology requires a sustained concentration that I don’t possess. You may.
THE FUTURE
Buckminster Fuller was described as a futurist. Of that future, Fuller wrote in 1981 that the world’s power structures were about to collapse; but, in that collapse, humanity’s vast resources would become available on a scale never before experienced.
The introduction to Fuller’s The Critical Path was titled Twilight of the World’s Power Structures, Fuller wrote: …the world’s power structures have always “divided to conquer” and have always “kept divided to keep conquered.”
As a consequence the power structure has so divided humanity—not only into special function categories but into religious and language and color categories—that individual humans are now helplessly inarticulate in the face of the present crisis. They consider their political representation to be completely corrupted; therefore they feel almost utterly helpless. (1981)
Buckminster Fuller believed, however, that it was not political and economic systems that needed examination. It was ourselves; that as individuals we needed to examine our own integrity.
…When we speak of the integrity of the individual, we speak of that which life has taught the individual by direct experience. We are not talking about loyalty to your mother, your friends, your college fraternity, or your boss, who told you how to behave or think. In speaking of truth, we are not talking about the position to take that seems to put you in the most favorable light.
If we want the future to be a better future we must be that better future ourselves. Expecting it to be otherwise is as self-deceiving as it is futile. These are significant times. Expecting politicians to provide us with answers will leave us with none.
My current youtube videos are Today’s crisis: The 1930s Magnified (http://youtu.be/e-fGq07eekg) and The Mystery of my Writing: Time of the Vulture, etc (http://youtu.be/0y8vPPNxKo8).
Buy gold, buy silver, have faith.
Darryl Robert Schoon
www.survivethecrisis.com (http://www.survivethecrisis.com/)
www.drschoon.com (http://www.drschoon.com/)
About The Hidden Pivot Method
The method I use to forecast swing points and trends is the most accurate and powerful I’ve discovered in 30 years of trading. It is also by far the simplest, requiring little more than junior high school math to do the necessary calculations. I first learned about this amazingly precise method of analysis from a floor trader on the Pacific Stock Exchange named Ira Tunik. At the time, Ira was using the cycles work of J.M. Hurst, a pioneer in the field of technical analysis, to make a very good living on the options floor. When he retired as a pit trader in the late 1980s, he shifted his nest egg mostly into bonds, which at the time were providing annualized returns approaching 10 percent. However, when interest rates began to decline from those cyclical peaks, Ira realized he would need a foolproof trading strategy to live well off his savings without having to dip into principal.
http://www.rickackerman.com/wp-content/uploads/2011/05/can-a-powerful-trading-system-be-this-easy.jpg (http://www.rickackerman.com/wp-content/uploads/2011/05/can-a-powerful-trading-system-be-this-easy.jpg)
Over the next year-and-a-half, Ira delved exhaustively into the world of trading systems, reading every book he could find on Elliott Wave Theory, Gann Angles, Pyrapoint, Fibonaccis, oscillators, stochastics — even astrology. The system he finally settled on was called Lindsay’s Trident. But for reasons explained below, it took us both several more years and many modifications to tweak the system into its present, very powerful form. For starters, we discarded the core principle of Charles Lindsay’s trend-following system, substituting some stunningly effective corollaries that Lindsay himself evidently had failed to recognize. The result was a rules-based system that, combined with a little street-sense, can outperform some of the most powerful black box systems ever devised.
Stocks BreatheAt the heart of the system is a simple observation — that stocks breathe in and out, and that for every zig in a chart there is a zag somewhere else that corresponds to it exactly. Think of it as a flux of yin and yang energy seeking equilibrium at all times. Once you are able to identify the complementary zigs and zags, it becomes possible not only to discern the fundamental rhythms of the market, but to use this knowledge to predict price swings. This means, for one, that stop-losses of a point or less can be used to trade the Mini-S&P futures. Also, counter-trend entries are possible in the opening minutes of the day, when even the pros are typically on the sidelines waiting for the dust to settle.
http://www.rickackerman.com/wp-content/uploads/2011/05/buying-where-the-competition-fears-to-go.jpg (http://www.rickackerman.com/wp-content/uploads/2011/05/buying-where-the-competition-fears-to-go.jpg)
This allows us to initiate trades at “uninteresting” prices where relatively few predators will be ready to pounce. The result is that we can gain a statistically significant edge on the most tedious, range-bound days. Everyone who has traded index futures has experienced such days: the market establishes a range in the first 30-90 minutes, then spends the rest of the day making fools of those who would attempt to second-guess, or “pick,” that range.
But what if you could initiate trades before a range had even been established – and at a price which to most other chartists would look like the middle of nowhere, so to speak? That is exactly what the Hidden Pivot System allows you to do, enabling you to exit the market with a fat profit before the competition has had a second cup of coffee.
The beauty of the system is that you don’t have to be a math whiz to master it. My Hidden Pivot rules are more visual than mathematical, and they can be applied to potent effect by anyone with the patience and diligence to monitor weekly, daily and intraday charts over time. Speaking as a “permabear,” I should mention that the system has been particularly useful to me, since it allows me to override my innate bearishness with mechanical objectivity. I am a bear’s bear by inclination. Armed with this system, however, I am perfectly comfortable being a raging bull when the signs are right. (Note: You’ll receive a Hidden Pivot calculator with your course materials.)
How It WorksHow does the system work? To start with, I always try to visualize the price movement of stocks, commodities, options and indexes in the perspective of an ABCD pattern such as the one shown above. Unlike Elliott Wave Theory, which is rooted in trend patterns with five legs and corrections with three, my method distills all of the action down to three legs. It also sidesteps the often daunting task of distinguishing corrections from trend moves. Those who are familiar with Elliott Wave Theory know that even EWT experts sometimes bog down in the choppy seas of corrective patterns. Terms such as expanded flats, extended or truncated fifths, double and triple threes, zigzags, and contracting, ascending and descending triangles are all part of Elliott Wave terminology, and they must all be mastered by the chartist who would attempt to forecast accurately and profitably. However, Hidden Pivot strategies, on the other hand, shun such complexities, focusing instead on the most fundamental rhythms of the market. If you can distinguish good art from bad, you can learn the Hidden Pivot Method.
So how do I keep from getting fooled or confused by corrective patterns? Simply by treating them, not as corrections, but as ABCD patterns unto themselves. Remember, I said that all price action can be reckoned in ABCD terms. This means that the B-C leg of the pattern above can itself be divided into an abcd structure, as follows:
http://www.rickackerman.com/wp-content/uploads/2011/05/the-cd-leg-contains-a-treasure-of-information.jpg (http://www.rickackerman.com/wp-content/uploads/2011/05/the-cd-leg-contains-a-treasure-of-information.jpg)
The subdivision yields no crucial information per se, but if one applies a simple test to the abcd pattern, specifically to its c-d leg, he will be rewarded with a cornucopia of tradable information. For example, if the midpoint of the c-d leg is hit precisely and a rally ensues, you can be confident the rally will reach the ‘D’ target of the larger pattern just as precisely. This rule, as well as many others that are equally useful, are discussed regularly in my newsletter, Rick’s Picks, with charts to illustrate.
Trident’s InventorIronically, the originator of the system never completely understood how powerful it was. The Trident System was developed in the early 1970s by a man named Charles Lindsay, who marketed it in seminar form with Larry Williams, commodity trader extraordinaire. The seminar had an unusual marketing gimmick: Students could pay the hefty tuition fee out of trading profits. No profits, no fee. Trident is still available in book form from Windsor Publishing, but its rudiments can be encompassed in a single chart:
http://www.rickackerman.com/wp-content/uploads/2011/05/the-trident-identified-just-one-entry-point.jpg (http://www.rickackerman.com/wp-content/uploads/2011/05/the-trident-identified-just-one-entry-point.jpg)
The crux of Lindsay’s method was to wait for an AB impulse leg to form; then, after a BC pullback into a rule-based “window,” the trader would initiate a position exactly 25% (point ‘X’) along a follow-through leg that one presumed would eventually equal AB in points. After entering, the trader would to place a stop-loss just below point ‘C’.
An Obvious WeaknessOne obvious weakness of this system is that it limits itself to just a single entry point along the entire length and breadth of the ABCD pattern. In the chart above, assuming it is of daily-bar magnitude, that could mean two or three week of waiting for one good entry opportunity. Another problem is that point ‘X’ is intuitively too obvious – a grazing spot where you and just about every other trader will instinctually be waiting to get long. Think about it. If you were looking to trade a stock and it suddenly shot up, producing a nice, robust AB impulse leg like the one in the illustration above, you would probably be thinking, “Geez, that was one heckuva rally I missed.” Still game to trade, you’d hope for a pullback – one that presumably would provide a comfortable spot to enter. Of course, you’d be nervous about buying the stock while it was still falling, so you’d look for a sign that the correction had ended. What better sign than a nascent uptrend? Typically, the comfort zone for buying this rally belatedly would occur somewhere around point X. Am I right? If you’ve ever traded stocks or commodities, you can understand why, in the midst of the picture-perfect rally described by the chart, jumping aboard at or near point X would feel entirely natural.
Then, as we know all too well, XYZ shares will fall just far enough to stop the herd out somewhere below point C. The stock will then turn sharply higher, and it’ll be “off to the races!” So how do we take advantage of this lovely pattern without getting burned? Recall what I said earlier, that Ira and I discarded Lindsay’s core principal, focusing on its far more useful corollaries. Specifically, we tossed out the notion that only point X works as an entry spot. By watching this pattern play out many thousands of times on the one-, five-, and fifteen-minute bar charts, we were able to determine more than a dozen additional entry points, both long and short, along the path of ABCD.
In the chart below, this implies you would get long at A; short at B; long at C; even longer at X; take partial profits at P; and exit at D — or even reverse the position by shorting at D.
http://www.rickackerman.com/wp-content/uploads/2011/05/milking-every-drop-of-opportunity-from-an-uptrend.jpg (http://www.rickackerman.com/wp-content/uploads/2011/05/milking-every-drop-of-opportunity-from-an-uptrend.jpg)
The system would be a winner if it merely yielded the microscopically accurate swing points that it does. But in fact it can do much more. An especially powerful feature of the system is that it can determine at all times which trend is dominant – up or down. By observing price action at the midpoint of follow-through legs (i.e., along ‘cd’), one can predict with confidence, precision and consistency the continuation of trends, or, alternatively, their termination.
Hidden Pivots and Risk ControlVeteran traders are wont to say that “the trend is your friend,” insisting that no system which trades against the trend, as this one appears to do, can make money consistently. I like to reply simply that we are not trading against the trend; rather, we are initiating positions at the very first tick of new trends. Indeed, the system is so accurate that bids must often be placed a tick above or below tradable swing points, since buying or shorting at the actual pivot risks missing the trade because of liquidity problems.
I usually refer to these swing points as “hidden pivots” because they are not on the radar screens of conventional chartists. In practice, I do not usually initiate trades at hidden pivots that are coincident with support and resistance lines, trendlines, Fibonaccis and other price points that are widely observed and likely to be well anticipated. It’s always a thrill to catch a ride at a reversal point that has obviously caught the crowd unawares. And what better way to start the day than with a profitable trade executed amidst what most traders would describe as opening-hour chaos? This system not only makes it possible to do so, it also allows rigorous control of risk to a degree that is all but impossible to achieve with other methods.
A Short Video DemonstrationThe following cursory but useful demonstration will give you an idea of the visual nature of my method.
Would you like to learn more? Consider taking my Hidden Pivot Seminar, a two-day, six-hour online event that provides complete instruction on the method. Click the button below for complete course details and signup.
something for the tech heads.......
Timing the Gold Bull
-- Posted Tuesday, 30 October 2012 | Share this article (http://news.goldseek.com/GoldSeek/1351609200.php) | Source: GoldSeek.com
Dreaming the impossible dream
The question of when gold’s long awaited ascent will happen is not without precedence. A similar question is still being asked by the Jews concerning the appearance of the Messiah. Prediction has always been an inexact science.
TIMING MARKETS AND TIMING GOLD
http://67.19.64.18/news/2012/10-29ds/1.jpg
In my book, Time of the Vulture, How to Survive the Crisis and Prosper in the Process (http://www.drschoon.com/bookstore.asp), I quote market timer and industry insider, Rick Ackerman:
…the stock market is a rigged game… It really is just a giant carny game, one in which there are only predator and prey, and precious few big winners. Wall Street’s best and brightest may have more teeth and fewer tattoos than carny men, but they employ essentially the same skills in separating the gullible from their hard-earned dollars. Both try to convince us that “Everybody goes home a winner!” even though we know better. We always imagine ourselves winning the big stuffed panda, even though we know we’ll be lucky to take home a pack of Marlboros or a Luke Skywalker keychain
Ackerman’s cynical comments are a result of Ackerman’s 12 years experience as a market maker on the floor of the Pacific Stock Exchange. That markets are rigged, however, doesn’t mean that hedged, educated and often accurate predictions cannot be made. In fact, Ackerman’s newsletter, Rick’s Picks (http://www.rickackerman.com/), purports to do just that.
I first became aware of Ackerman’s refreshingly cynical market commentary in the 1990s when he wrote a financial column for the San Francisco Chronicle. It was not, however, until ten years later that I became aware of Ackerman’s sometimes astounding accuracy.
Using a proprietary technical methodology Ackerman calls ‘hidden-pivots’, Ackerman predicts tops and bottoms, i.e. turning points, for all markets, i.e. commodities, treasuries, stocks, etc; and, in 2006 we had an opportunity to see what Ackerman’s hidden-pivots could do.
In 2006, we were holding warrants issued by Agnico-Eagle Mines. Warrants on gold mining shares can often be more volatile than profitable. In March 2006, our warrants had lost 2/3 of their value before gold suddenly began moving upwards, increasing exponentially the value of our warrants in a very short period of time.
Warrants, by definition, are time-dependent giving buyers the option for a limited time to purchase underlying shares at a predetermined price; and as gold began rising in 2006, the question became, what would be gold’s top before it turned down?
Gold had started its rise in mid-March at $535. In April, it moved up past $600 and by the end of the month was nearing $700. The hidden-pivot Ackerman predicted for gold’s turning point was $715.50 and I remember watching gold’s daily move towards Ackerman’s hidden-pivot.
In early May, gold crossed $700. Then on May 11th, gold exceeded Ackerman’s hidden-pivot during inter-day trading before dropping to end exactly at $715.50, Ackerman’s hidden pivot. The next day, gold rose to $725.00 before beginning a multi-week decline.
On May 12th, we sold our warrants and that summer flew to New York to attend Ackerman’s hidden pivot seminar. We wanted to know how anyone could predict with that degree of accuracy, gold’s then top; and, at the seminar, Ackerman explained how he had come by his methodology and how it worked.
Today, when I was referencing Ackerman’s website, in his October 29thnewsletter, Ackerman explained his methodology in About the Hidden Pivot Method (http://www.rickackerman.com/about-the-hidden-pivot-method/):
The method I use to forecast swing points and trends is the most accurate and powerful I’ve discovered in 30 years of trading. It is also by far the simplest, requiring little more than junior high school math to do the necessary calculations. I first learned about this amazingly precise method of analysis from a floor trader on the Pacific Stock Exchange named Ira Tunik. At the time, Ira was using the cycles work of J.M. Hurst, a pioneer in the field of technical analysis, to make a very good living on the options floor. When he retired as a pit trader in the late 1980s, he shifted his nest egg mostly into bonds, which at the time were providing annualized returns approaching 10 percent. However, when interest rates began to decline from those cyclical peaks, Ira realized he would need a foolproof trading strategy to live well off his savings without having to dip into principal.
http://67.19.64.18/news/2012/10-29ds/2.jpg
How does the system work? To start with, I always try to visualize the price movement of stocks, commodities, options and indexes in the perspective of an ABCD pattern such as the one shown above. Unlike Elliott Wave Theory, which is rooted in trend patterns with five legs and corrections with three, my method distills all of the action down to three legs. It also sidesteps the often daunting task of distinguishing corrections from trend moves. Those who are familiar with Elliott Wave Theory know that even EWT experts sometimes bog down in the choppy seas of corrective patterns. Terms such as expanded flats, extended or truncated fifths, double and triple threes, zigzags, and contracting, ascending and descending triangles are all part of Elliott Wave terminology, and they must all be mastered by the chartist who would attempt to forecast accurately and profitably. However, Hidden Pivot strategies, on the other hand, shun such complexities, focusing instead on the most fundamental rhythms of the market. If you can distinguish good art from bad, you can learn the Hidden Pivot Method.
Nothing can be predicted with 100% accuracy and Ackerman doesn’t make that claim. Heisenberg’s Uncertainty Principal is far too ubiquitous a truth for that to occur. Nonetheless, for those not yet committed to buy and hold gold and silver for the long term, Ackerman offers a viable alternative to investing in increasingly unpredictable markets.
Caveat: Ackerman’s methodology requires a sustained concentration that I don’t possess. You may.
THE FUTURE
Buckminster Fuller was described as a futurist. Of that future, Fuller wrote in 1981 that the world’s power structures were about to collapse; but, in that collapse, humanity’s vast resources would become available on a scale never before experienced.
The introduction to Fuller’s The Critical Path was titled Twilight of the World’s Power Structures, Fuller wrote: …the world’s power structures have always “divided to conquer” and have always “kept divided to keep conquered.”
As a consequence the power structure has so divided humanity—not only into special function categories but into religious and language and color categories—that individual humans are now helplessly inarticulate in the face of the present crisis. They consider their political representation to be completely corrupted; therefore they feel almost utterly helpless. (1981)
Buckminster Fuller believed, however, that it was not political and economic systems that needed examination. It was ourselves; that as individuals we needed to examine our own integrity.
…When we speak of the integrity of the individual, we speak of that which life has taught the individual by direct experience. We are not talking about loyalty to your mother, your friends, your college fraternity, or your boss, who told you how to behave or think. In speaking of truth, we are not talking about the position to take that seems to put you in the most favorable light.
If we want the future to be a better future we must be that better future ourselves. Expecting it to be otherwise is as self-deceiving as it is futile. These are significant times. Expecting politicians to provide us with answers will leave us with none.
My current youtube videos are Today’s crisis: The 1930s Magnified (http://youtu.be/e-fGq07eekg) and The Mystery of my Writing: Time of the Vulture, etc (http://youtu.be/0y8vPPNxKo8).
Buy gold, buy silver, have faith.
Darryl Robert Schoon
www.survivethecrisis.com (http://www.survivethecrisis.com/)
www.drschoon.com (http://www.drschoon.com/)
Timing the Gold Bull
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-- Posted Tuesday, 30 October 2012 | Share this article (http://news.goldseek.com/GoldSeek/1351609200.php) | Source: GoldSeek.com
Dreaming the impossible dream
The question of when gold’s long awaited ascent will happen is not without precedence. A similar question is still being asked by the Jews concerning the appearance of the Messiah. Prediction has always been an inexact science.
TIMING MARKETS AND TIMING GOLD
http://67.19.64.18/news/2012/10-29ds/1.jpg
In my book, Time of the Vulture, How to Survive the Crisis and Prosper in the Process (http://www.drschoon.com/bookstore.asp), I quote market timer and industry insider, Rick Ackerman:
…the stock market is a rigged game… It really is just a giant carny game, one in which there are only predator and prey, and precious few big winners. Wall Street’s best and brightest may have more teeth and fewer tattoos than carny men, but they employ essentially the same skills in separating the gullible from their hard-earned dollars. Both try to convince us that “Everybody goes home a winner!” even though we know better. We always imagine ourselves winning the big stuffed panda, even though we know we’ll be lucky to take home a pack of Marlboros or a Luke Skywalker keychain
Ackerman’s cynical comments are a result of Ackerman’s 12 years experience as a market maker on the floor of the Pacific Stock Exchange. That markets are rigged, however, doesn’t mean that hedged, educated and often accurate predictions cannot be made. In fact, Ackerman’s newsletter, Rick’s Picks (http://www.rickackerman.com/), purports to do just that.
I first became aware of Ackerman’s refreshingly cynical market commentary in the 1990s when he wrote a financial column for the San Francisco Chronicle. It was not, however, until ten years later that I became aware of Ackerman’s sometimes astounding accuracy.
Using a proprietary technical methodology Ackerman calls ‘hidden-pivots’, Ackerman predicts tops and bottoms, i.e. turning points, for all markets, i.e. commodities, treasuries, stocks, etc; and, in 2006 we had an opportunity to see what Ackerman’s hidden-pivots could do.
In 2006, we were holding warrants issued by Agnico-Eagle Mines. Warrants on gold mining shares can often be more volatile than profitable. In March 2006, our warrants had lost 2/3 of their value before gold suddenly began moving upwards, increasing exponentially the value of our warrants in a very short period of time.
Warrants, by definition, are time-dependent giving buyers the option for a limited time to purchase underlying shares at a predetermined price; and as gold began rising in 2006, the question became, what would be gold’s top before it turned down?
Gold had started its rise in mid-March at $535. In April, it moved up past $600 and by the end of the month was nearing $700. The hidden-pivot Ackerman predicted for gold’s turning point was $715.50 and I remember watching gold’s daily move towards Ackerman’s hidden-pivot.
In early May, gold crossed $700. Then on May 11th, gold exceeded Ackerman’s hidden-pivot during inter-day trading before dropping to end exactly at $715.50, Ackerman’s hidden pivot. The next day, gold rose to $725.00 before beginning a multi-week decline.
On May 12th, we sold our warrants and that summer flew to New York to attend Ackerman’s hidden pivot seminar. We wanted to know how anyone could predict with that degree of accuracy, gold’s then top; and, at the seminar, Ackerman explained how he had come by his methodology and how it worked.
Today, when I was referencing Ackerman’s website, in his October 29thnewsletter, Ackerman explained his methodology in About the Hidden Pivot Method (http://www.rickackerman.com/about-the-hidden-pivot-method/):
The method I use to forecast swing points and trends is the most accurate and powerful I’ve discovered in 30 years of trading. It is also by far the simplest, requiring little more than junior high school math to do the necessary calculations. I first learned about this amazingly precise method of analysis from a floor trader on the Pacific Stock Exchange named Ira Tunik. At the time, Ira was using the cycles work of J.M. Hurst, a pioneer in the field of technical analysis, to make a very good living on the options floor. When he retired as a pit trader in the late 1980s, he shifted his nest egg mostly into bonds, which at the time were providing annualized returns approaching 10 percent. However, when interest rates began to decline from those cyclical peaks, Ira realized he would need a foolproof trading strategy to live well off his savings without having to dip into principal.
http://67.19.64.18/news/2012/10-29ds/2.jpg
How does the system work? To start with, I always try to visualize the price movement of stocks, commodities, options and indexes in the perspective of an ABCD pattern such as the one shown above. Unlike Elliott Wave Theory, which is rooted in trend patterns with five legs and corrections with three, my method distills all of the action down to three legs. It also sidesteps the often daunting task of distinguishing corrections from trend moves. Those who are familiar with Elliott Wave Theory know that even EWT experts sometimes bog down in the choppy seas of corrective patterns. Terms such as expanded flats, extended or truncated fifths, double and triple threes, zigzags, and contracting, ascending and descending triangles are all part of Elliott Wave terminology, and they must all be mastered by the chartist who would attempt to forecast accurately and profitably. However, Hidden Pivot strategies, on the other hand, shun such complexities, focusing instead on the most fundamental rhythms of the market. If you can distinguish good art from bad, you can learn the Hidden Pivot Method.
Nothing can be predicted with 100% accuracy and Ackerman doesn’t make that claim. Heisenberg’s Uncertainty Principal is far too ubiquitous a truth for that to occur. Nonetheless, for those not yet committed to buy and hold gold and silver for the long term, Ackerman offers a viable alternative to investing in increasingly unpredictable markets.
Caveat: Ackerman’s methodology requires a sustained concentration that I don’t possess. You may.
THE FUTURE
Buckminster Fuller was described as a futurist. Of that future, Fuller wrote in 1981 that the world’s power structures were about to collapse; but, in that collapse, humanity’s vast resources would become available on a scale never before experienced.
The introduction to Fuller’s The Critical Path was titled Twilight of the World’s Power Structures, Fuller wrote: …the world’s power structures have always “divided to conquer” and have always “kept divided to keep conquered.”
As a consequence the power structure has so divided humanity—not only into special function categories but into religious and language and color categories—that individual humans are now helplessly inarticulate in the face of the present crisis. They consider their political representation to be completely corrupted; therefore they feel almost utterly helpless. (1981)
Buckminster Fuller believed, however, that it was not political and economic systems that needed examination. It was ourselves; that as individuals we needed to examine our own integrity.
…When we speak of the integrity of the individual, we speak of that which life has taught the individual by direct experience. We are not talking about loyalty to your mother, your friends, your college fraternity, or your boss, who told you how to behave or think. In speaking of truth, we are not talking about the position to take that seems to put you in the most favorable light.
If we want the future to be a better future we must be that better future ourselves. Expecting it to be otherwise is as self-deceiving as it is futile. These are significant times. Expecting politicians to provide us with answers will leave us with none.
My current youtube videos are Today’s crisis: The 1930s Magnified (http://youtu.be/e-fGq07eekg) and The Mystery of my Writing: Time of the Vulture, etc (http://youtu.be/0y8vPPNxKo8).
Buy gold, buy silver, have faith.
Darryl Robert Schoon
www.survivethecrisis.com (http://www.survivethecrisis.com/)
www.drschoon.com (http://www.drschoon.com/)
About The Hidden Pivot Method
The method I use to forecast swing points and trends is the most accurate and powerful I’ve discovered in 30 years of trading. It is also by far the simplest, requiring little more than junior high school math to do the necessary calculations. I first learned about this amazingly precise method of analysis from a floor trader on the Pacific Stock Exchange named Ira Tunik. At the time, Ira was using the cycles work of J.M. Hurst, a pioneer in the field of technical analysis, to make a very good living on the options floor. When he retired as a pit trader in the late 1980s, he shifted his nest egg mostly into bonds, which at the time were providing annualized returns approaching 10 percent. However, when interest rates began to decline from those cyclical peaks, Ira realized he would need a foolproof trading strategy to live well off his savings without having to dip into principal.
http://www.rickackerman.com/wp-content/uploads/2011/05/can-a-powerful-trading-system-be-this-easy.jpg (http://www.rickackerman.com/wp-content/uploads/2011/05/can-a-powerful-trading-system-be-this-easy.jpg)
Over the next year-and-a-half, Ira delved exhaustively into the world of trading systems, reading every book he could find on Elliott Wave Theory, Gann Angles, Pyrapoint, Fibonaccis, oscillators, stochastics — even astrology. The system he finally settled on was called Lindsay’s Trident. But for reasons explained below, it took us both several more years and many modifications to tweak the system into its present, very powerful form. For starters, we discarded the core principle of Charles Lindsay’s trend-following system, substituting some stunningly effective corollaries that Lindsay himself evidently had failed to recognize. The result was a rules-based system that, combined with a little street-sense, can outperform some of the most powerful black box systems ever devised.
Stocks BreatheAt the heart of the system is a simple observation — that stocks breathe in and out, and that for every zig in a chart there is a zag somewhere else that corresponds to it exactly. Think of it as a flux of yin and yang energy seeking equilibrium at all times. Once you are able to identify the complementary zigs and zags, it becomes possible not only to discern the fundamental rhythms of the market, but to use this knowledge to predict price swings. This means, for one, that stop-losses of a point or less can be used to trade the Mini-S&P futures. Also, counter-trend entries are possible in the opening minutes of the day, when even the pros are typically on the sidelines waiting for the dust to settle.
http://www.rickackerman.com/wp-content/uploads/2011/05/buying-where-the-competition-fears-to-go.jpg (http://www.rickackerman.com/wp-content/uploads/2011/05/buying-where-the-competition-fears-to-go.jpg)
This allows us to initiate trades at “uninteresting” prices where relatively few predators will be ready to pounce. The result is that we can gain a statistically significant edge on the most tedious, range-bound days. Everyone who has traded index futures has experienced such days: the market establishes a range in the first 30-90 minutes, then spends the rest of the day making fools of those who would attempt to second-guess, or “pick,” that range.
But what if you could initiate trades before a range had even been established – and at a price which to most other chartists would look like the middle of nowhere, so to speak? That is exactly what the Hidden Pivot System allows you to do, enabling you to exit the market with a fat profit before the competition has had a second cup of coffee.
The beauty of the system is that you don’t have to be a math whiz to master it. My Hidden Pivot rules are more visual than mathematical, and they can be applied to potent effect by anyone with the patience and diligence to monitor weekly, daily and intraday charts over time. Speaking as a “permabear,” I should mention that the system has been particularly useful to me, since it allows me to override my innate bearishness with mechanical objectivity. I am a bear’s bear by inclination. Armed with this system, however, I am perfectly comfortable being a raging bull when the signs are right. (Note: You’ll receive a Hidden Pivot calculator with your course materials.)
How It WorksHow does the system work? To start with, I always try to visualize the price movement of stocks, commodities, options and indexes in the perspective of an ABCD pattern such as the one shown above. Unlike Elliott Wave Theory, which is rooted in trend patterns with five legs and corrections with three, my method distills all of the action down to three legs. It also sidesteps the often daunting task of distinguishing corrections from trend moves. Those who are familiar with Elliott Wave Theory know that even EWT experts sometimes bog down in the choppy seas of corrective patterns. Terms such as expanded flats, extended or truncated fifths, double and triple threes, zigzags, and contracting, ascending and descending triangles are all part of Elliott Wave terminology, and they must all be mastered by the chartist who would attempt to forecast accurately and profitably. However, Hidden Pivot strategies, on the other hand, shun such complexities, focusing instead on the most fundamental rhythms of the market. If you can distinguish good art from bad, you can learn the Hidden Pivot Method.
So how do I keep from getting fooled or confused by corrective patterns? Simply by treating them, not as corrections, but as ABCD patterns unto themselves. Remember, I said that all price action can be reckoned in ABCD terms. This means that the B-C leg of the pattern above can itself be divided into an abcd structure, as follows:
http://www.rickackerman.com/wp-content/uploads/2011/05/the-cd-leg-contains-a-treasure-of-information.jpg (http://www.rickackerman.com/wp-content/uploads/2011/05/the-cd-leg-contains-a-treasure-of-information.jpg)
The subdivision yields no crucial information per se, but if one applies a simple test to the abcd pattern, specifically to its c-d leg, he will be rewarded with a cornucopia of tradable information. For example, if the midpoint of the c-d leg is hit precisely and a rally ensues, you can be confident the rally will reach the ‘D’ target of the larger pattern just as precisely. This rule, as well as many others that are equally useful, are discussed regularly in my newsletter, Rick’s Picks, with charts to illustrate.
Trident’s InventorIronically, the originator of the system never completely understood how powerful it was. The Trident System was developed in the early 1970s by a man named Charles Lindsay, who marketed it in seminar form with Larry Williams, commodity trader extraordinaire. The seminar had an unusual marketing gimmick: Students could pay the hefty tuition fee out of trading profits. No profits, no fee. Trident is still available in book form from Windsor Publishing, but its rudiments can be encompassed in a single chart:
http://www.rickackerman.com/wp-content/uploads/2011/05/the-trident-identified-just-one-entry-point.jpg (http://www.rickackerman.com/wp-content/uploads/2011/05/the-trident-identified-just-one-entry-point.jpg)
The crux of Lindsay’s method was to wait for an AB impulse leg to form; then, after a BC pullback into a rule-based “window,” the trader would initiate a position exactly 25% (point ‘X’) along a follow-through leg that one presumed would eventually equal AB in points. After entering, the trader would to place a stop-loss just below point ‘C’.
An Obvious WeaknessOne obvious weakness of this system is that it limits itself to just a single entry point along the entire length and breadth of the ABCD pattern. In the chart above, assuming it is of daily-bar magnitude, that could mean two or three week of waiting for one good entry opportunity. Another problem is that point ‘X’ is intuitively too obvious – a grazing spot where you and just about every other trader will instinctually be waiting to get long. Think about it. If you were looking to trade a stock and it suddenly shot up, producing a nice, robust AB impulse leg like the one in the illustration above, you would probably be thinking, “Geez, that was one heckuva rally I missed.” Still game to trade, you’d hope for a pullback – one that presumably would provide a comfortable spot to enter. Of course, you’d be nervous about buying the stock while it was still falling, so you’d look for a sign that the correction had ended. What better sign than a nascent uptrend? Typically, the comfort zone for buying this rally belatedly would occur somewhere around point X. Am I right? If you’ve ever traded stocks or commodities, you can understand why, in the midst of the picture-perfect rally described by the chart, jumping aboard at or near point X would feel entirely natural.
Then, as we know all too well, XYZ shares will fall just far enough to stop the herd out somewhere below point C. The stock will then turn sharply higher, and it’ll be “off to the races!” So how do we take advantage of this lovely pattern without getting burned? Recall what I said earlier, that Ira and I discarded Lindsay’s core principal, focusing on its far more useful corollaries. Specifically, we tossed out the notion that only point X works as an entry spot. By watching this pattern play out many thousands of times on the one-, five-, and fifteen-minute bar charts, we were able to determine more than a dozen additional entry points, both long and short, along the path of ABCD.
In the chart below, this implies you would get long at A; short at B; long at C; even longer at X; take partial profits at P; and exit at D — or even reverse the position by shorting at D.
http://www.rickackerman.com/wp-content/uploads/2011/05/milking-every-drop-of-opportunity-from-an-uptrend.jpg (http://www.rickackerman.com/wp-content/uploads/2011/05/milking-every-drop-of-opportunity-from-an-uptrend.jpg)
The system would be a winner if it merely yielded the microscopically accurate swing points that it does. But in fact it can do much more. An especially powerful feature of the system is that it can determine at all times which trend is dominant – up or down. By observing price action at the midpoint of follow-through legs (i.e., along ‘cd’), one can predict with confidence, precision and consistency the continuation of trends, or, alternatively, their termination.
Hidden Pivots and Risk ControlVeteran traders are wont to say that “the trend is your friend,” insisting that no system which trades against the trend, as this one appears to do, can make money consistently. I like to reply simply that we are not trading against the trend; rather, we are initiating positions at the very first tick of new trends. Indeed, the system is so accurate that bids must often be placed a tick above or below tradable swing points, since buying or shorting at the actual pivot risks missing the trade because of liquidity problems.
I usually refer to these swing points as “hidden pivots” because they are not on the radar screens of conventional chartists. In practice, I do not usually initiate trades at hidden pivots that are coincident with support and resistance lines, trendlines, Fibonaccis and other price points that are widely observed and likely to be well anticipated. It’s always a thrill to catch a ride at a reversal point that has obviously caught the crowd unawares. And what better way to start the day than with a profitable trade executed amidst what most traders would describe as opening-hour chaos? This system not only makes it possible to do so, it also allows rigorous control of risk to a degree that is all but impossible to achieve with other methods.
A Short Video DemonstrationThe following cursory but useful demonstration will give you an idea of the visual nature of my method.
Would you like to learn more? Consider taking my Hidden Pivot Seminar, a two-day, six-hour online event that provides complete instruction on the method. Click the button below for complete course details and signup.