It looked liked bulls would romp ahead of the holiday weekend, but they grew increasingly cautious as the day wore on and eventually pulled back 20 points shy of the 3175.50 target shown. They were rightfully concerned about the strongly resurgent pandemic and even more fearful that news over three-day weekend would worsen. Even if it does, expect the lunatics to be out in force on Monday, trashing common sense and brimming with confidence that short-covering will keep stocks moving higher. Ordinarily we’d have been bidding on the pullback to the red line (p=3119.13) , stop 3100.30, but not just ahead of a long weekend. Traders could still attempt the ‘mechanical’ buy if index futures open soft on Sunday evening, but it would be less risky to wait for a pullback to x=3090.14 to go bottom-fishing. Here’s a bigger picture that shows why Thursday’s stampede halted exactly where it did. The 3392.75 rally target may seem surreal, but it could become an odds-on bet, depending on how the lunatics handle the 3158.25 midpoint Hidden Pivot.
