The futures ratcheted marginally higher last week, vexing traders of all stripes every step of the way. It didn’t matter whether you were a bull or a bear, a seller or buyer of straddles, a directional bettor or a delta-neutral rocket scientist, there were pitfalls and booby traps to bedevil even the most seasoned pros. Notice in the chart how the E-Mini S&Ps made a series of marginally higher highs over the course of the week. Although a bull could have profited in the end by simply staying long, this was a bad bet from a risk/reward standpoint. Notice how getting from one high to the next would have required weathering adverse swoons three to four times as large as the incremental gain achieved using a buy-and-hold strategy. For better or worse, the new week promises at least a little more of the same. The 2697.25 rally target we’ve been using all along is still viable, although an easy move past it, or a two-day close above it, would strongly imply the rally will continue. _______ UPDATE (April 16, 4:58 p.m.): Yet more tedious ratcheting bought the futures to within 10 points of the 2697.25 target. It is sufficiently clear and compelling that I expect a pullback, possibly tradeable, from within 2-3 ticks of my number. However, an easy and decisive move past the pivot, especially one that exceeds the 2744.00 ‘external’ peak shown here, would suggest the uptrend may be about to steepen.________ UPDATE (April 17, 6:04 p.m.): Buyers barely paused at 2697.25, implying they have eyes for the 2744.00 benchmark I’ve noted above. If ES pulls back after slightly exceeding it, be alert to any ‘camouflage’ entry set-up that could occur thereupon.
