In the chat room on Thursday, we used 2090.25 as a lodestone and it served us well, not only keeping us on the right side of the session’s 28-point rally, but also providing a very predictable target. How predictable?  Here is my post in the chat room from 12:18, when the futures were closely approaching 2090.25:  “[The E-Minis are] slithering up to a key ‘external’ peak at 2090.25 recorded last Thursday on the way down. There WILL be a pullback from just beneath it that could be tradable. However, a pullback [following a move ] exceeding 2090.25 by even a tick would almost surely be tradable — from the long side, of course.”  In the actual event, the E-Minis topped at 2088.75 ten minutes later, then spent the next hour-and-a-half screwing the pooch.

Whether this entirely gratuitous chop was tradable or not is open to discussion, since the three pullbacks that occurred over the 90-minute pooch-screwing interval amounted to no more than five points each.  Thereafter, however, and precisely on cue, shorts panicked in the final minutes of the session, driving the future up to — you guessed it! — an intraday high at 2091.25. Night owls may have an opportunity to get long via a ‘counterintuitive’ entry if the futures go no lower than 2084.25. I’ve sketched this tactic for your guidance, using the current low, 2085.00, to set up a possible entry trigger at 2086.81. (Note: This would change if a lower point ‘C’ occurs.)  The key to the trade, and to maintaining a bullish bias here, is that the AB leg of the ABC pattern shown, in strongly impulsive fashion, exceeded the 2090.25 peak from a week ago.