The futures plunged Friday from a high just shy of the threshold where we’d eagerly anticipated getting short. The trade would have entailed using a ‘reverse ABC’ (rABC) pattern in order to cut the roughly $3000 entry risk per contract in half. It was not to be, however, since sellers clobbered this vehicle before it achieved the loft that would have triggered the trade. The 623-point rally decline in the Dow that followed drew headlines, but it was pretty feeble in my estimation, having failed, even, to re-test the midpoint Hidden Pivot support at 2825.50 that became the launching pad for a 120-point rally. Will Friday’s selloff intensify in the week ahead as the tariff-war’s mounting costs to the global economy become all too clear? If so, we should see the S&Ps fall more than 100 points in a single day, and sometime soon. For now, though, if sellers breach the 2825.50 midpoint pivot decisively, the pattern’s 2705.75 target will be in play. _______ UPDATE (Aug 27, 12:34 a.m.): The futures have been screwing the pooch for three weeks and just entered week four. We are waiting to get short when the face-saving trade deal that is coming triggers a short-covering rally.
ESU19 – Sep E-Mini S&P (Last:2882.75)