The futures bounced yesterday two ticks from the 2101.75 target I’d flagged the night before. However, if you missed buying near the low, which occurred a few minutes before the opening bell, the remainder of the day would have entailed a struggle to stay awake. The rally carried to 2112.00 — worth nearly $500 per contract to anyone lucky enough to have been long for the ride — but from that point forward, stocks meandered in a trance-inducing range for the next five hours.
This was on a day when earnings announcements from AAPL and Chipotle should have energized stocks. Instead, Chipotle took a maniacal leap in the opening minutes, then leveled off into a tight range; while AAPL, for its part, jumped to recover half of the previous night’s losses, then went brain-dead until the close.
Going forward, I’d suggest a ‘mechanical’ buy on a pullback to p=2107.75, using a stop-loss at 2106.75. The trade looks like it could ripen before the bell, so I am recommending it to night owls. Regardless, my immediate expectation is for a rally to D=2112.75, a Hidden Pivot that can be shorted provided you’ve been long on the way up. ________ UPDATE (9:57 a.m. EDT): No trade got triggered at p; however, a ‘mechanical buy’ from p2=2110.25 would have worked, producing a $125 profit in 56 minutes following entry at 12:28 a.m. The trader would have experienced no adversity, since 2110.25 was the low tick of the rally that ultimately reached the target. Thereafter, the futures never got above 2113.75, so reversing the position at the target as advised would have worked too, producing a gain so far of a little more than $400 per contract. Not bad on a day when ‘nothing’ is happening.