The bullish pattern shown is gnarly enough to work, whether you are trying to nail a short-term top, forecast intraday swings or bottom-fish on pullbacks. It also assumes that the vicious short squeeze in progress at the closing bell on Friday will carry into the new week. That’s hardly a given, considering the balky behavior and arrested trends in both directions that have characterized the market during the last couple of months. You can confidently infer that a follow-through to D=3916.75.75 impends if short-covering bears demolish the p=3779.13 resistance Sunday evening. A one-level pullback thereafter can be used to get long via a ‘mechanical’ bid, provided you thoroughly understand such set-ups. _______ UPDATE (Oct 24, 9:33 a.m.): Greed got the better of the night shift last night, as it nearly always does, although price action was much nuttier than usual for a Sunday night. It began with a single-bar head-fake on the opening, but it was downhill for the next ten hours. A so-far timid climb began at 5:00 a.m., with predictably low participation. However, all of this did not alter the bullish target, which I am adjusting slightly higher, to 3917.50, nor did it affect the usefulness of the pattern. A one-level pullback will still set up a ‘mechanical’ buy with a good chance of generating a profit. The overnight low at 3736.50 failed to do this — i.e., missed the green line (3711.06) — by 25 points, but a ‘sloppy seconds’ entry remains viable. Here’s a visual summary. _______ UPDATE (Oct 27, 6:07 p.m.): It is bearish that ES missed my 3916 rally target by 20 points, or 0.5%, but remarkable nonetheless that it is holding up fairly well amidst today’s FAANG carnage. ES has recouped half of the engineered, after-the-bell downdraft. This is pure distribution sleaze, but it is coordinated with the even more amazing swoon in AAPL. AAPL is so effectively targeted on short-squeeze opportunities that it is setting up a squeeze on the entire stock market. This afternoon’s two-minute dive from $145 to $136 and then back up to $145 is thumbing its nose at the earnings-news-obsessed maniacs with the taunt “Is that the worst you can do?”
ESZ22 – Dec E-Mini S&Ps (Last:3774.00)
