Except for the booster stage of this rally, it’s been just mincing steps. The implied power of it would ratchet up a few notches, however, if it hits 117^27 by week’s end.
From the monthly archives:
June 2009
The 9008 target is growing a bit stale, even if it remains viable in theory. Here’s a target that is equally valid and which is proffered to stretch the bearish imagination: 7569. It is the Hidden Pivot midoint of the pattern shown in the chart, and the implied 1000-point drop doesn’t seem like much of a stretch in the context of the larger, bearish patterns at work.
I’m not keen on chasing the puts, so let’s move to the sidelines and wait for the minor downtrend play out. If the Diamonds are going to provide us with another opportunity to get short on an upswing, they should put in a tradable bounce from either 84.43 or 83.47, or both. While we’re waiting, you can bottom-fish the second number with a stop-loss as tight as 8 cents. _______ UPDATE: Cancel the bid, since DIA has remained stubbornly buoyant.
The futures will need to punch through a midpoint resistance at 938.00 to convert yesterday’s impulsive rally into something we can root for. A Hidden Pivot at 945.00 would become the minimum upside objective at that point, and just a dime more (i.e., 945.10) would renew the bull trend on the hourly chart for yet another surge.
Powerful as yesterday thrust may have seemed, it fell a tad shy of impulse-leg glory on the hourly chart. The September contract would need to beat 1.0366 to accomplish that — 14 ticks above yesterday’s high. Traders please note: a pullback from just 2-3 ticks above 1.0366 would be buy-able.
Any Hidden Pivots we might find would be superseded by visually obvious support near 36.60 that was created by a series of lows in mid-May.
The Dollar Index looked like it was on its way up to at least 81.76 yesterday when it got timed out. Any higher today would suggest that this rally has legs.
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We’ll stick our necks out an inch today, bidding 1.90 for two August 80 puts (DIJTB). We’d be looking to buy more of them if the futures were aboutto top at a Hidden Pivot resistance, but in this case they have already started lower, negating any edge we might hope to gain by shorting as Hidden Pivot swing point. _______ UPDATE (8:48 a.m.): Lower the put bid to 1.70 and leave it in for the session. With DIA likely to open somewhat higher, there’s no point in sticking our necks out.
What’s Next, an Abby Cohen Sell Signal?
by Rick Ackerman on June 17, 2009 2:40 am GMT · 4 comments
Sometimes common sense comes from the most unexpected places. Consider this bearish take on the stock market from – better sit down for this – a Morgan Stanley strategist, Jason Todd: “Equity markets now implicitly need a V-shaped recovery to sustain further gains,” he told a reporter for the Wall Street Journal yesterday. “We do not expect such a recovery and therefore believe the next move is more likely to be down than up.” What’s next? A warning from Abby Cohen, perhaps, to lighten up on stocks? Actually, it looks like traders » Read the full article