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NQM20 – June E-Mini Nasdaq (Last:9667.00)

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I sometimes joke that virtually every trading vehicle, in every time frame, whether trending up or down, reverses from p2, the secondary pivot, virtually every time. Or so it would seem. I was never really a p2 kind of guy, but my mentor, Ira Tunik, used it so often, and persuaded so many Rick’s Picks subscribers that it was important, that I eventually started to pay attention. That’s when I began to see that it actually does repel trends almost as consistently as my beloved ‘p’ midpoint Hidden Pivot. It has also become clearer recently that some of the most successful traders in the room have been using p2 to set up rABC trades that deliver as consistently as a loose slot machine in a Reno bust-out joint.

All of which is intended to call attention to the chart shown in the inset, a weekly graph of the E-Mini Nasdaq futures. This lunatic-powered vehicle comprises an invincible core of no-decision stocks that institutional holders would never even consider selling. That is why it is spitting fire at the moment, just inches from record highs. Notice as well that Wednesday’s peak, which put a new high on the bounce from March’s Mindanao abyss, occurred almost precisely at p2=9585. I wouldn’t want to put ideas in your head, but there are worse places to attempt getting short.  Just sayin’. We can use puts in $NDX, so stay tuned to the chat room for timely ideas — or make sure you’ve enabled ‘Updates’ on your account page. The caveat here is that buyers shredded the 8600.00 midpoint pivot the first time they encountered it on the way up. This made it likely that D=10,571 will be reached. As you can see, it sits well above the current record high at  9763.00.  I can’t believe I’m actually saying this, since it seems so preposterous. But that’s what the chart implies, and there is no getting around it. A two week close above p2=9585 would all but clinch a move to 10,571 in my estimation. If you’re itching to get short, better to do it here and get it out of your system, since it could be the last good opportunity you’ll have to do so if the futures break out above 10,571. _______ UPDATE (May 28, 7:28 p.m. EDT):  A 12:26 p.m. post in the Trading Room set up a short from near the intraday high that could have produced a profit of as much as $588 per contract. A second post followed at 2:46 p.m. containing detailed risk-management instructions. Here’s the chart.  Since some subscribers reported doing the trade, I’m establishing a tracking position. Those who followed my explicit guidance would have a realized gain so far of about $1000, with a single short contract remaining that has a profited adjusted cost basis of 9534. We’ll give it a generous stop-loss for now at  9503.50, worked o-c-o with a bid to cover at 9307.  _______ UPDATE (May 31, 10:53 p.m.): The last contract was covered at 9503.50, adding $610 to the $1000 gain already booked. A wide stop-loss was used only because the original plan was to swing for the fences. Ordinarily, we would not subject ourselves to the headless-chicken histrionics that were likely to accompany an important speech by Trump during market hours. In this case, the market went psychotic in both directions but eventually moved higher when traders breathed a sigh of relief that China would not be punished too severely for putting a stake through the heart of Hong Kong’s political and economic autonomy. _______ UPDATE (June 3, 8:57 p.m.):  It looks like an explosion to 10,571 is coming, since the futures have met the requirement stipulated above — i.e., a two-day close above 9586.

Please do not ask trading questions!

  • STANLEY A CARSON June 3, 2020, 1:42 pm

    You ought to be the star of a Las Vegas nightclub show or be a new superhero of good humor who offers us a healthy dose of much needed truth. You crack me up so thoroughly I can almost enjoy being forced out of my perpetual shorts. Thanks for dissolving the boredom blues for a moment or two.


    Thanks for the kind words, Stan. Your note made my day.

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