The futures finally broke out of a consolidation pattern Friday following seven days’ of constipated price action. Although we’ve been using 2492.50 as a big-picture rally target, the 2429.75 target shown, a minor Hidden Pivot Hidden resistance, can serve as a precise benchmark for the near term. Since we never assume the midpoint resistance will be exceeded on the first try, or even that it will be exceeded at all, it can be used for now as a minimum upside objective on Monday. If it gives way easily, that would be a clear sign that 2429.75 is likely to be reached soon thereafter. In the meantime, a pullback to the green line can be bought ‘mechanically,’ stop 2375.50. Once the futures have held decisively above the red line (p=2402.63) for the required several bars, it too can be used to set up a ‘mechanical’ entry bid, stop 2393.50. _______ UPDATE (May 8, 6:56 p.m. ET): The futures spiked above the red line at 2402.63 (see above) on the opening bar, but only by 1.00 point. The bull trap this thimble-rigging maneuver created is likely to weigh on Tuesday’s opening, but buyers should be sufficiently refreshed by mid-morning to attempt a run at Monday’s 2403.75 high.
