Rick Ackerman

Bears did what was expected of them Tuesday, driving the futures sharply higher with a spate of short-covering that should have caused DaBoyz to smile. The stock market is now entering day three of a global rally triggered by perceptions that voters will ultimately reject Marine LePen's bid for the French presidency. It would seem to matter little, particularly on Wall Street, that Macron, her opponent and likely victor in a runoff scheduled for May 7, will have no mandate to govern.  Still, as the thinking goes, at least he won't deny France its proper role in presiding over the inevitable collapse of the euro and the EU. In the investment world, that would seem to count as good news these days. Looking  ahead, we should expect the futures to continue their heedless ascent to the 2439.00 target shown. This Hidden Pivot has served as a lodestone since late March. Judging from the way buyers blew past the 2378.38 midpoint pivot on Wednesday, there should be little doubt that 2439.00 will be reached. A pullback to the red line before Thursday would not meet our criterion for a 'mechanical' entry, but there will be other ways to get aboard, so stay tuned to the chat room if you care.

DaBoyz looked to be in good position to short-squeeze the broad averages higher for a second straight day. They must be pleased to know that they can nearly always count on short-covering bears to push stocks higher with far more power than mere bullish buying ever could. Check out the latest update to my VXX tout, since it contains actionable guidance designed to take advantage of this. The trade could return great odds if a moderate rally today sputters out around mid-session.

An upthrust today exceeding 1290.10 would put bulls squarely back in charge. At that point our minimum upside objective would be 1315.10, a Hidden Pivot taken from the hourly chart where A=1248.20 on April 10. Alternatively, if the futures fall for a second consecutive day, the first chance they'd have to reverse would be from 1267.90, a minor midpoint Hidden Pivot. However, a decisive penetration of that support would indicate more downside to at least 1255.80. Traders could bottom-fish there with a stop-loss as tight as four ticks, but I'll recommend this only to those of you who have caught a piece of the short on the way down. _______ UPDATE (Apr 25, 10:54 a.m. ET): The rally from just beneath p=1267.90 will remain suspect until such time as it exceeds 1280.00. _______ UPDATE (Apr 25, 11:27 p.m.): Despite the gingerly probing of the secondary pivot at 1261.80, June Gold still looks like it wants to go lower. The 1255.80 target remains viable, along with the recommendation to bottom-fish there if you've been short for at least part of the way down.

GOOG will max out the rally pattern shown if and when it hits 866.35, a compelling Hidden Pivot target that will have taken nearly three months to reach. Let's be ready for a possible price reversal with a bid for some out-of-the-money puts. Specifically, bid 2.45 for two April 28 835 puts, day order. If filled, stop yourself out if the options subsequently trade below 2.00.  Alternatively, on an o-c-o basis, offer one of them to close for 3.90, good-till-canceled. Our bid is based on a calculation of the puts' fair value if the stock rises by nearly $4 on Tuesday;  from that I subtracted 20% to account generously for time decay, since the puts will expire in just four days. If the position is stopped out, bid 1.65 for two more puts, day order. That bid is based on a Hidden Pivot target for the options themselves. _______ UPDATE (Apr 25, 9:48 a.m.): The stock has dropped back moderately after failing to push past the 866.35 target. The intraday high so far is 865.80, close enough to the target to consider it a dead-center bullseye. The puts are out of reach at the moment but I'll suggest leaving in the lowball bid for the day nevertheless. _______ UPDATE (Apr 25, 12:02 a.m.): Cancel the bid for the puts, since the stock appears to be headed into the wild blue yonder, oblivious to gravity and driven by the global tide of funny money.

DaBoyz have goosed stocks punitively to start the new week, emboldened by LePen's failure to win France's presidential election in the first round. Although we usually prefer to fade extreme price moves when they are driven by news, in this case the bulls may have it right if LePen loses the May 7 run-off to centrist Macron. We'll get a confident read on whether this is likely to happen if the E-Mini S&Ps decisively exceed the 2378.38 midpoint Hidden Pivot shown, since that would put the futures on track to hit the 2439.00 target shown. Such a powerful rally would likely occur only if France averts the epic disaster predicted by the new media and elites should 'Trump candidate' Marine LePen, who favors pulling out of the EU, become France's new president.

The futures have been churning for a month, unable to muster the gumption for a run at new record highs.  The last one, recorded on March 1, occurred a millimeter from a Hidden Pivot target that had been 13 months in coming. Small wonder, then, that buyers would need a rest. But seven weeks' worth? What are they waiting for? If it's sunny economic news, traders may have to bide their time for a year or two while the U.S. economy weathers a recession. We've been writing about this prospect for quite a while, since it's seemed obvious that rising interest rates would eventually kill the housing and auto sectors. This appears to be happening right now, even if it will be another six to nine months before the Commerce Department figures it out.  The foregoing should tell you why the E-Mini S&Ps seem in no great hurry to test the old high. If and when they do, however, it will not be because of bullish buying power, but because of short-covering by bears too agitated to simply let stocks fall. That is sufficient reason for us to give the 2439.00 rally target the benefit of the doubt for now. But if the futures should pleasantly surprise by getting the crap kicked out of them next week, the fun would begin with a breach of the 2304.25 downside target shown. That target is not new, just neglected and forgotten in the throes of last week's excruciating scuddle. _______ UPDATE (Apr 23, 7:40 p.m. ET): DaBoyz have squeezed the futures sharply higher Sunday evening, exuberantly over-celebrating LePen's failure to capture the French presidency on the first ballot. We should pay attention not to the election, but to whether this short-squeeze pushes the June contract through the 2378.38 midpoint Hidden Pivot resistance

It's early Friday morning, and bears and bulls are frozen in a nervous standoff that is almost certain to settle in favor of the latter.  The E-Mini S&PS are up by a deceptively placid quarter of a point, but make no mistake, they would be absolutely flying if DaBoyz let go of the reins. That this has not occurred owes to the fact that, like the panic-stricken shorts they aim to torture all night, DaBoyz are eager to buy as much as they can get their hands on before they goose stocks shortly after the opening. Check out my 00:02 post in the chat room, since there may be a way to make a few bucks if things play out in just this way.

The futures impaled a clear Hidden Pivot resistance at 2356.25, surpassing April 12's 'external' peak at 2356.50 in the process to generate a robust impulse leg on the intraday charts. Clearly, bulls are in great shape to end the week on an upswing, although it may require a soft opening to prevent stocks from getting too juiced at the bell to attract buyers. I have no 'easy' trade to offer overnight, since it's impossible to predict where the point 'C' low of the pattern shown will occur. It looks promising nonetheless and would become still moreso for tripping a buy-stop entry if DaBoyz open this vehicle moderately lower, then reverse it suddenly in the first five minutes of the session.

All kinds of economic news is due out on Thursday, including jobless claims, leading indicators and money supply. Each has had its influence on the stock market at some time in the past, but none of them gets much respect these days. As such, DaBoyz will have to move stocks the old-fashioned way, manipulating them in whatever way it takes to goad shorts into covering. That's how nearly all strong rallies begin and end, even if we'll never see some celebrated permabear -- David Stockman gets my vote -- ringing the opening bell at the NYSE.