Rick Ackerman

There are no epiphanies in this lesson, just solid examples of rABC- and ‘mechanical-trade logic when applied to some of our favorite trading vehicles. There is a forced trade in the E-Mini S&Ps that produced a very quick, theoretical profit of $800 in real time. This gambit was interesting because the rally we shorted extended well above the level where we’d originally planned to do the trade.

Bertie has been too dull lately to deserve the top spot in the 'touts'  list, but it has found its way there nonetheless because of a quirk in my publishing tool that I did not foresee when I published the latest updates later than usual on a Sunday. Be that as it may, this vehicle is still generating some excellent trading opportunities, mostly with 'mechanical' entries. The one shown is a textbook inversion that tripped a buy signal on the September 10 pullback to the green line. A somewhat riskier buy signal would occur on a retracement now to p=46,180.  The stop-loss would be at 45,177.  I suggest paper-trading this one unless you know what you're doing. The D target at 49,371 can be used similarly. ______ UPDATE (Sep 20, 12:23 p.m.): Evergrande has sucked the speculative juices from even the hardiest lunatic vehicles, including this one. The 'risky' mechanical trade got crushed, along with the bullish reverse ABC pattern that had informed it. Bitcoin will continue to lead stock-market rallies, but keep in mind that these will be bear rallies, presumably offering us opportunities that will differ from what we've seen over the last decade.

Bears seem to be struggling more than bulls, implying the next move will be up rather than down. This is out of kilter with just about everything else I track, however, so I'll suggest using the bearish pattern shown, at least for the time being, to set up trades and gauge trend strength. Most immediately, I like the odds of bottom-fishing with an rABC pattern anchored midway between p and p2 (i.e., at around 219,35). This is intended as a day-trade, since the countertrend will not get very far if the broad averages continue to act weak. _______ UPDATE (Sep 20, 12:41 p.m.): IWM opened on a gap well beneath my prospective 'c' low, negating the trade. The fact that it has relapsed to crash the pattern's 'D' target is not a sign of good health. Sliding point 'A' up to Sep 7's 229 high yields a new target at 213.41. Given the way the downtrend crushed 'p'. further slippage to at least D=213.41 is all but inevitable, and your trading bias should therefore remain bearish. Here's the chart. _______ UPDATE (9:57 p.m.): The nasty bounce has come from a low that fell somewhat shy of the 213.41 target. I still regard a relapse to this Hidden Pivot as likely, so I'll suggest shorting p=218.38 with a 220.03 stop-loss. ______ UPDATE (Sep 21, 10:20 p.m.): The 'mechanical' trade suggested in the last update worked perfectly, producing a quick $996 gain on 400 shares early in the session.  No one mentioned it in the chat room, so I did not established a tracking position.  Here's a chart that illustrates how the trade worked. (Note: You could still be short 25% to 50% of the original position, shooting for D or lower.) _______ UPDATE (Sep 22, 9:31 p.m.): We're at three days

Usually, violent swings make for profitable 'mechanical' trading. In this case, however, the ride south has been marked by heavy chop that's made trading an obvious downtrend as difficult as surfing in a storm. DIA has triggered just one legitimate short along the C-D leg  -- but from the red line rather than the less risky place at the green one where we typically jump aboard.  I am still looking for a tradeable if temporary upturn from around 340, which would be well within the discomfort zone that has cued up so many of our trades in recent months.  As noted here earlier, this gambit will require an rABC-type entry recommended only for those who are familiar with the tactic. _____ UPDATE (Sep 20, 12:52 p.m.): Sellers have pushed DIA well below 340, implying that the next place we might look for a 'discomfort-zone' low would be in the range 335.15-337.40 (visually estimated). if you understand why, I would encourage you to attempt the trade. Here's a graph to help you visualize the set-up. ______ UPDATE (Sep 20, 10:04): The trade worked, but because it entailed an especially  challenging entry and only one subscriber reported doing it, I have not established a tracking position. Now let's see if the little bugger can make it up into to the gap between 342.16 and 345.31. _______ UPDATE (Sep 21, 10:34 p.m.): The little bugger's rally failed near the middle of the gap, setting up a nice 'discomfort zone' short for any Pivoteer who was eager to trade. The subsequent downtrend projects to at least 336.90 (60-min, a= 342.16 at 10:30 a.m. on 9/20 , b=335.99 and c=343.07. _______ UPDATE (Sep 22, 9:36 p.m.): The rally had shorts mildly on the run at the close. It also negated the short-term bearish pattern, albeit

Subscribers have reported doubling out of put positions initiated at or very near the recent, precisely predicted high, presumably leaving themselves with enough contracts to swing for the fences. Please let me know in the chat room where you stand, since that will allow me to fine-tune my guidance.  Regardless, the immediate downside target is the 370.30 Hidden Pivot support shown in the chart (inset).  Judging from the decisive penetration of the pattern's midpoint pivot at 374.60, sellers have enough steam to get it to D.  FYI, a pop up to x=376.75 in the meantime would trigger a theoretical 'mechanical' short, stop 379.00. _______ UPDATE (Sep 20, 1:04 p.m.): There is no avoiding a test of the 359.96 low recorded on Aug 19.  This will create a tradeable opportunity, so nudge me in the chat room when the time comes if you are interested.  In the meantime, your trading bias should be short. Here's the chart. ______ UPDATE (Sep 21, 10:08 p.m.): Short-covering bears hit the panic button well shy of the 359.96 low noted above, implying they were all but certain the Cubes would bounce from near there in a big way. Their certitude means a test of the low is likely, but even so, we should not get in the way of the bounce, which looks headed into a gap between 369 and 372. _____ UPDATE (Sep 23, 9:53 p.m.): Bear buying filled the gap, but without surpassing any prior peaks. We'll hang back and see what Friday brings.

Silver has fallen Sunday evening to the 22.11 secondary Hidden Pivot of the pattern shown (inset), but the weak bounce so far implies that if and when the support gives way, the selloff will continue down to at least D=21.165.  The pattern is a little too obvious for high-odds bottom-fishing , but it will still make it difficult for December Silver to take another leg down without an upward correction first from D. Accordingly, I"ll recommend a 'camouflage' set-up  on the 5-minute chart or less to get long, using an 'a-b leg' small enough to limit theoretical entry risk to no more than $750 per contract. Nudge me in the chat room when appropriate if you are looking for further guidance in real time.

Friday's closing bar ruptured the 'D' support shown, suggesting the December contract will grope its way lower in search of a temporary bottom. The week was hard on bulls and bears alike, but it is the latter who seemed to have gotten the worst of it. This suggests to me that the stock market is building a major top, a point of emphasis here over the last month or so.  The actual bull-market high may have occurred two weeks ago when the December contract hit 4549.50, but there are too many bears that I respect who agree for me to be confident it's going to be that easy.  My hunch is that index futures will open with a thud Sunday evening, and I am publishing this tout a couple of hours earlier than usual in order to put that prediction to the test. For a bigger-picture view of a 4503.50 bull-market target that has been very slightly exceeded, check out the chart and commentary accompanying the latest The Morning Line. _______ UPDATE (Sep 20, 1:16 p.m.): The futures have fallen into a gap between major lows recorded, respectively, at 4339.75 (Aug 19) and 4215.00 (7/19) that is too big to extrapolate a high-odds low.  When the turn finally comes, we can assess the underlying bullishness/bearishness of it based on its location relative to the two lows. In any event, the impulse-leg idea obtains here: The farther the collapse goes without an upward correction, the more bearish. ______ UPDATE (10:36 p.m.): The bounce came from roughly midway between two lows, the second of which was a compelling one-off. This suggests it is doomed, but that we shouldn't try to intercept it too aggressively. Let's see what the first bear rally in more than 12 years looks like before trying anything fancy.

Bears had a rare chance to get short with impunity last week -- arguably the first such free-money opportunity since the bull market began more than 12 years ago. With the Evergrande saga unfolding in real time, shares appeared to be doing a Wile E. Coyote ahead of Friday's opening. Their gravity-defying behavior reflected one of those deft manipulations where DaBoyz greet whatever fragile bids show up in the early going with a feather-light touch. On Friday, playing it by the book, they scaled back their offers until the very last of the idiots from Mars doing the  buying were fully satisfied. The result was that stocks hovered aloft for just long enough that traders who had gotten things exactly right -- i.e., realized that Evergrande's failure could make the 1998 collapse of Long-Term Capital Management look like a furniture-store liquidation -- must have begun to doubt themselves. It was only after the opening bell that they came to their senses with the apparent realization that any selling done on Friday was all but certain to look fortuitous come Sunday evening.  Stocks began to fall, but not nearly as steeply as they are likely to fall in the days, weeks and months ahead. Indeed, I am publishing this commentary ahead of Sunday's resumption in trading to drive home my point, which is this: Evergrande's imminent implosion could turn out to be the biggest speculative collapse in history. It is going to take down many big players, causing a chain reaction that will definitively end the buying mania that has gripped shares since Covid-19's "bullish" failure to put civilization into eclipse. Up to Their Eyeballs For now, don't believe talking-heads blather about how Black Rock, Goldman Sachs et al. hold only relatively small stakes in Evergrande.  The truth is, when you

This was the worst week the S&Ps have seen in a long while. They looked so enfeebled, actually, that bears for a rare change acted unthreatened by the rallies. Half-hearted upthrusts repeatedly failed, and even the impulsive head-fakes showed no follow-through. In the end, with a steep, downward finishing stroke ahead of Friday's closing bell, the futures created a robustly bearish impulse leg on the hourly chart.  Although Pivoteers can try bottom-fishing in the discomfort zone near 4410, my expectation is that the December contract will grind lower, seeking support from the August 19 low near 4340. ______ UPDATE (Sep 14, 1):55 p.m. ET): The jagged downtrend looks like no other that we've seen for years, suggesting something has changed. When was the last time the S&Ps declined for four straight days?  That is one reason the pattern is so unusual. However, bears have gotten the worst of it, since the rally spikes all the way down have exceeded the incremental gains from any short position held from one low to the next.  This is nasty price action, but bears may be tested even further before they get a two- or three-day freefall to enjoy. _______ UPDATE (Sep 16, 8:55 p.m.): Bears have been getting brutalized by short squeeze rallies that have been too fleeting to go anywhere, but too vicious to endure. If they lose again on Friday, DaBoyz will be in good position to pop this hoax to new record highs next week.