Monday’s wilding spree was perfectly predictable, although I didn’t notice why until I was preparing this tout. After the obligatory short squeeze in the opening minutes of the session, the futures spent the rest of the day slithering toward the 2051.00 target of the very asymmetrical pattern shown. I had originally suggested getting short Sunday night but canceled this guidance when the trade took far too long to develop. “Any downtrend this constipated must be an uptrend in disguise,” I noted in the chat room around 1:00 a.m. And so it was. Bears threw in the towel around 2 a.m. Monday, allowing the futures to waft higher, which in turn set the stage for a nasty morning goosing that left bears on the ropes for the remainder of the session.
As of around 8:00 p.m., the futures had given up little ground, suggesting that the short squeeze is likely to continue. Assuming this is so, the rally would gain critical mass with a push past 2062.50, a midpoint Hidden Pivot that can be located on the hourly chart using A=1982.50 on 10/14. Thereafter, a ‘mechanical’ bid based on p2=2094.25 would require a stop-loss at 2051.50. You should attempt this only if you thoroughly understand the tactic.