We’re short a single contract from last week’s exact high, shooting for a theoretical gain of at least $5000 per contract.  However, I’ve recommended that those who initiated the trade using three or more contracts have two-thirds of the position covered if and when the June contract closely approaches 1310.00, my minimum downside target for the corrective cycle begun from 1373.50 0n May 1.  I’ll also recommend bottom-fishing at 1310.50, stop 1309.50.  This trade can be done “against-the-box” if your broker will allow it, but also as a new position for those of you who currently have no stake. You should take a partial profit on 50% of the position at 1314.00 on a multi-contract position, switching to a 3.00-point trailing stop above 1328.00.

I have jettisoned my wonted, niggardly risk:reward parameters this time for two reasons: 1) even traders who are obsessive about risk management as I am occasionally swing for the fences; and 2) even if we get stopped out by a head-fake above 1358.25, there will always be another opportunity. In any event, we will keep shorting this little s.o.b. until we catch the actual top of the Mother of All Bear Rallies. As you can see, it’s possible to do this at every swing high without losing a dime if we are wrong.  The trick is to take a partial profit if the pullback we expect from each Hidden Pivot rally target actually occurs.  If you’re curious about how well we’ve succeeded at this, try asking in the chat room.  And if you’re not a paying subscriber, click here for a free trial that will give you access to the entire Rick’s Picks site, including a 24/7 chat room frequented by veteran traders from around the world.