The Nasdaq has punched through to new record highs. Although its tempting to dismiss this dubious milestone as the work of lunatics who recklessly manage Other People’s Money and who believe that no price is too much to pay for the likes of Tesla, Netflix, Priceline, Twitter and other legendary companies of the New Millennium, the rally is proof that the game is not yet over.  The S&Ps and Industrial average seem all but certain to follow the Naz higher, and so we need to be prepared for whatever blow-off top impends.

The rally could yet collapse, since a stock market trading in record territory generates the sort of fervor among bulls that blinds them to their own excesses. The prospect of a bull trap seems even more compelling, given that economic data from around the world has begun to dim ominously. While this might portend mere recession in ordinary times, it is a matter far more grave when a global slowdown could easily set in motion the deflationary implosion of a quadrillion-dollar, global house of cards.

In any event, we’ll be eager to short the 3674 target shown, since this ‘Hidden Pivot’ resistance is a technically logical place for the rally to fail.  However, if the resistance gives way easily, we’ll simply keep trying — always with the very tight stop-losses that the Hidden Pivot Method allows. FYI, the next appealing short would come at 3739 — our minimum upside target if 3674 gives way. _______ UPDATE (February 17,  11:53 p.m.): The futures peaked on Friday just 1.50 points from our target, denying us an easy opportunity to get short safely ahead of a three-day weekend. If you did so nonetheless, you’ll need to keep tabs on this critter Monday night. I’d suggest an impulse leg-based stop-loss derived from the 3-minute chart or less. Please report any ‘live’ positions in the chat room if you would like me to update my guidance.