Friday’s wildly gratuitous swings were prompted by a Powell speech that added almost nothing to what investors already knew about the Fed’s intentions. The session ended with an impulsive leap of faith that surpassed an important ‘external’ peak made a day earlier on the way down. Despite this show of bravado, the suspicion of a bear rally will remain until such time as the major indices surpass the record highs of mid-February. The futures cannot but telegraph the outcome if and when they encounter the 3872.50 midpoint resistance, but they will need to smash through it on the first try to become an odds-on bet to reach the ‘D’ target at 4023.75. That would be yet another record high, even if no guarantee of a new bull market cycle. Come what may, we can use the HP levels shown in the chart to buy the futures ‘mechanically’ as opportunities arise. _______ UPDATE (Mar 8, 6:53 p.m. ET): Buyers diddled the 3872 pivot, exceeding it slightly before retreating sharply. I hesitate to ascribe any meaning to it, but it did not make me more bearish. ______ UPDATE (Mar 9, 4:22 p.m.): After three tries the futures have finally speared p=3872.50 and even closed above it, albeit slightly. Bulls look enervated and unimpressive, but the 4023.75 target still gets the benefit of the doubt because bears look even more drained.
ESH21 – March E-Mini S&Ps (Last:3870.00)