Just because the futures topped Friday almost exactly where we’d expected doesn’t mean the rally is over. It will be, eventually, perhaps even in our lifetime. But odds favor more upside most immediately to at least D=4413.75 (see inset) before buyers take a breather. I’m down with getting short there, but let’s at least try to make a few bucks on the remaining 50 or so points to the target. This will require close attention to the intraday charts, since there can be no true impulse legs on the daily chart when the averages are making new record highs. To keep things in perspective, especially for hopeful permabears, the September contract could plunge to the red line (p=4216), and be none the worse for it — be a fetching ‘mechanical’ buy, actually; or even to x=4118 and still look bullish. _____ UPDATE (July 13, 10:13 p.m.): A promising ‘mechanical’ long triggered late in the session off this pattern, but I did not sanction it because it promised a long night for bulls. This was irrespective of whether one’s goal was the red line (not recommended), or just a nominal profit. True to the forecast at the time (in the chat room), the futures stopped out the intraday low before embarking on a so-far weak rally that is break-even at the moment. _______ UPDATE (July 14, 9:31 a.m.): After bottoming out in the dead of night, the September contract has miraculously rallied to the red line, producing a profit of $3600 for anyone who boarded four lots ‘mechanically’ yesterday afternoon at x=4359.75. I’d suggest exiting at least half here while noting there is probably more profit left in the trade, since the phony JPM/GS shakedown is spent. D=4413.75, our old friend. _______ UPDATE (Jul 15, 5:39 p.m.): The weakness is becoming concerning, at least to bulls. It should have subsided a couple of days ago, when DaBoyz shook down stocks on ostensibly ‘bad’ new from the banking sector. But when has this bull market paused for more than a day or two, no matter how ‘bad’ the news? Anyway, They’ll be doing their best to prop up this hoax ahead of the weekend, so let’s sit back and enjoy whatever comedy comes our way. The 4413.75 target will remain theoretically valid nonetheless, even on a pullback of several hundred points, because it comes from a pattern of much larger degree than the minor, coincidental one at 4413.75 noted in the update.
ESU21 – Sep E-Mini S&P (Last:4348.00)