As anticipated, the futures ratcheted into a supply zone created last week before the broad averages went into a four-day decline. The purpose of this is to erode the confidence of any bear prescient enough to have gotten short near the recent, record highs. Bears shouldn’t expect any respite today, and they could even get impaled if there is ‘bullish’ news on the tape. My immediate target is 2118.50 (p2), or 2137.50 if any higher. If the futures come to rest near the second number shortly before Friday’s close, check for further guidance in the chat room, since that could provide a good opportunity to get short. Please note as well that the futures are already a mechanical buy at 2099.75, stop 2089.75, although the implied ten points of initial risk makes a ‘camouflage’ entry an enticing alternative. ______ UPDATE (2:12 p.m. EDT): So much for follow-through. Was Wednesday’s short squeeze the theatrical gasp of a dying bull? We can’t know for sure, at least not yet, but this morning’s relapse is telling, since it occurred without the futures having achieved new record highs. That means there will be a few bears left to tell the tale, suggesting that the formerly rampaging bull is either too weak to finish the job, or that it has deliberately left some survivors to drive the next short squeeze. It seems likely in any event that stocks will need to go lower before they can be squeezed higher again.
