The May 12 peak at 1160.75 that I’ve highlighted in the chart remains crucial to determining the ostensible health of the bear rally begun in July. The futures already missed an opportunity to impress us with an uncorrrected thrust through that resistance when they pulled back 27 points last week. That allowed them a running start at 1160.75 that has needed to be corrected as well. While we should love to see this limping lump of brick dust fail to clear the peak altogether, and for the Kudlows and institutional miscreants of the financial world to be trapped like the Egyptians at the Red Sea, that is probably too much to hope for. Shorts remain to be squeezed, and even to be stampeded, if the news should turn less than horrific for a week or two, and so we should expect DaBoyz to eventually effect a distribution above 1160.75. Regardless, we’ll take things one day at a time, which means we are focused on an 1159.75 Hidden Pivot rally target right now, subject to midpoint cross winds at 1143.50. Said midpoint has already been exceeded by 2.50 points, so don’t hold your breath waiting for a trend failure here.
