Shorts were on the ropes the whole day and getting no relief Tuesday evening. The rally during the regular session tripped a theoretical ‘buy’ signal at the green line (3272.25) that portends more upside to at least p=3311.25. I’ll recommend shorting there, presumably with an rABC pattern on a lesser chart, but only if you’ve caught a profitable piece of the action on the way up. As always, an easy move through the midpoint resistance would shorten the odds of more upside to D — in this case, 3389.50. That would be quite a rally, equivalent to about 1000 points in the Dow Industrials. They’d be trading just below 30,000 at that point, presumably drawn as if magnetized toward a historical milestone. _______ UPDATE (Jan 29, 9:14 p.m.): Bulls couldn’t get it going for a rare change, a failure that has opened a path down to p=3240.88 (click here to see chart). Traders can try bottom-fishing there rABC-style, with a suggested point ‘A’ at 3270.25 (1/29 at 10/20 a.m.). An easy breach of this Hidden Pivot support would portend more downside to as low as D=3189.00. ______ UPDATE (Jan 20, 8:43 a.m.): The 3240.88 target given above nailed the low of a 31-point dive overnight within a point, allowing subscribers to make hay — as much as $900 per contract — on the subsequent 18-point bounce. And so they evidently did, based on reports this morning from several happy campers in the chat room. Here’s a chart that shows the futures bouncing precisely from the targeted low. ______ UPDATE (Jan 30, 4:29 p.m.): The bounce continued from the tradeable low identified above, attracting ferocious short-covering in the final hour. This left bears on the ropes and bleeding badly. Their panic seems all but certain to drive the futures to at least p=3311.25, but a decisive move past this Hidden Pivot resistance would put D=3389.50 solidly in play. _______ UPDATE (Jan 31, 11:15 a.m.): Bulls are getting bloodied badly today. Refreshing as this may feel, it’s all just noise until such time as the downtrend starts taking out external lows on the hourly chart. At the moment, the decline has yet to even surpass the point C ‘internal’ low of the pattern with the 3311.25 midpoint. Although bears should be encouraged that today’s selloff has come without the futures having achieved a clear midpoint pivot (i.e., 3311.25), we’ll have to cross our fingers and hope bears don’t turn chicken and become short-covering fools. The Gold Standard: We still await three consecutive days of weakness, which has occurred only a few times over the last few decades.
