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A 228.44 downside target I'd sent out the night before caught Thursday's V-shaped low precisely. I'd proffered trading instructions as well, enabling some subscribers to buy call options at the exact bottom of an 846-point Dow rally.  Those who reported getting aboard in the Rick's Picks Trading Room used different strategies, so I did not establish a tracking position. However, using the 'rABC' entry tactic I'd explicitly advised could have produced a gain of as much as $34,000 on four round lots. Those who bought options instead would have doubled their money easily, although some of the expiring out-of-the-money calls traded for as much as seven times what they'd fetched in the early minutes of the session. I put DIA back on the touts list because some subscribers who follow the broad averages were keen to trade an equity-based vehicle rather than E-Mini S&P futures. The opportune timing of DIA's return to the list was not a coincidence. I had dropped it for a while because it went all boring on us, but brought it back in conjunction with bearish developments earlier in the week. If you are among those who said they wanted DIA back on the list, I'd suggest tuning to the chat room and monitoring my tout updates diligently to make the most of it. Speaking of which, DIA is bound for a minimum 237.59, whence you can expect a tradeable pullback. I am not putting out a trade a day in advance, however, since that Hidden Pivot resistance coincides with  a technically important peak at 237.50 that unfortunately will attract all the yo-yos. Here's the chart. ______ UPDATE (May 15, 8:39 a.m. EDT): Forget the chart, since index futures are down sharply ahead of the opening -- sufficiently so to take out the point 'C' low

Bull got pushed back on their heels for a change Wednesday, although sellers were unable to deliver a coup de grace in the final hour. The Dow Industrials ended the day with a 516-point loss nonetheless, unable to extract much yardage from short-covering. We've all been waiting for the other shoe to drop, but has it? It seems possible, since three weeks of noodling around failed to push the broad averages to targeted Hidden Pivot highs that weren't especially ambitious. AAPL, the world's most important stock, can usually help clarify the mood of portfolio managers, but its performance was mixed. The stock finished down about $3, well off the lows, and remained in the throes of a mild short squeeze just before midnight. If bears have anything going for them it will be the prospect of a weekend with little news to encourage.

Continuing yesterday's theme of how the stock market has completely decoupled from reality, we note that the shares of some publicly traded companies immersed in the home rental business have gone bonkers. A story on the front page of Tuesday's Wall Street Journal noted that "Investors are flocking to the U.S.'s mega-landlords, drawn by signs that companies that emerged from last decade's foreclosure crisis owning huge pools of rental houses are weathering the economic shutdown far better than feared." Oh really?  In the first place, these companies bought up whole blocks of homes, and even started building them as the trend gathered steam, near the top of the market. I learned about this first-hand from a friend who was sent by his employer to buy up every home he could find in the very-inflated Denver market. Although company had never before been involved in real estate, they got immersed in it up to their eyeballs in just two years, according to my friend. They Bought the Top Paying inflated prices will not be the worst of their problems as the economy sinks into a state of permanent recession-or-worse. Their tenants are mainly young families and couples unable to afford homes of their own, and it's likely they will have little saved to cushion themselves against very hard times. Concerning the notion that mega-landlords have weathered the pandemic better than expected, the optimists are jumping the gun, since we are less than two months into the downturn. Moreover, its effects have been muted so far by the $1,200 checks sent out to millions of Americans as part of a massive stimulus package. Anyone who received one of those checks would have recognized instantly that the goal of stimulating the economy was dead on arrival. No one went out and bought a

DIA would need to fall by 5 or 6 points to start looking interesting enough to play for a bounce. In the meantime. we'll look to catch a piece of the downside using put options that have gone from extremely overpriced in April to somewhat underpriced now. Specifically, near-the-money puts are sporting implied volatilities of around 30 versus recent actual volatility in the underlying of around 50. Accordingly, I'll suggest bidding 0.46 for four May 230 puts expiring this Friday. Mark the order good for the first 15 minutes of the session only. Although it would take a strong opening in DIA to push the puts down to our niggardly bid, my objective is to get subscribers familiar enough with the option grid that any trades we attempt as the week wears on will seem more familiar. ______ UPDATE (May 13, 9:24 p.m. EDT): We'll give the downtrend wide berth, since it feels like it could snowball.  If a countertrend opportunity were to materialize, the most logical place for this to occur would be near 228.44.  Pivoteers looking for a quick play should plant the low of an rABC pattern there to set up the trade. _____UPDATE (May 14, 10:27 a.m.): The 228.44 reversal target noted above has worked precisely, although the jury is still out on whether it will mark today's low. A subscriber reported covering some puts at the target -- a good thing, since DIA has bounced 1.50 off the low so far. _______ UPDATE (11:12 a.m.): The jury is no longer out, since the Dow Industrials have rallied 460 points and are trading close to 'even' since bottoming a hair beneath my 228.44 target.  I've asked subscribers to let me know if they were able to get long at the low using my instruction. If so,

Buyers had a coronary a millimeter above the 319.43 Hidden Pivot target shown in the chart. It had been three weeks in coming, and we should therefore expect this correction to take at least 3-4 days to run its course. It could turn out to be much worse than that, however -- perhaps even the dropping of the 'second shoe' that we have all dreaded.  If so, expect to see minor abc downtrends start breaching midpoint Hidden Pivot supports and exceeding their 'd' targets. The lesser charts will be a good place as always to assess the trend strength, and to temper our enthusiasm for bottom-fishing merely because we've become habituated to the stock market's nutty buying spree. As the downtrend starts to lengthen, assuming it does, we may be able to trade against the trend with risk under very tight control. Stay tuned. ______ UPDATE (May 13, 9:38 p.m. EDT): Sellers looked pretty feeble on day two of the downtrend, failing to achieve even the p midpoint support (301.79) of the first robust abc pattern (30-min, a=315.95 at 11:00 a.m.). Let's see if they can do better on Thursday, when they'll have a Friday finish line to coax them in the direction of the trend.

The futures sputtered out without achieving even the least ambitious of my bullish benchmarks. The targets remain valid in theory, but today's chart is intended to stretch the bearish imagination by emphasizing not Hidden Pivot levels, but a vast chasm below that taunts investors who may have whooped it up a little too heedlessly lately.  En route to the chasm, there are four technically significant lows stretching back to April 21's 2717.25, the most important of them. The others lie, respectively, at  2823.00 (5/6); 2771.00 (5/3); and 2755.25 (4/24). Every one of them is guaranteed to evince a flutter, bounce or breakdown, and so each will likely be be tradeable in some fashion.  If you're eager to test your chops and perhaps make a little money, or to see the Hidden Pivot System at work in real time, stay tuned to the chat room for guidance from the many experts (aka, 'Pivoteers') who frequent the room. Some subscribers will already be short and quite profitable, having acted on a very timely suggestion provided in the Trading Room by 'GDL', who outlined the details of his bearish bet the night before. _______ UPDATE (May 13, 10:02 p.m. EDT): The first 'structural' support in the sequence given above, 2823.00, propagated a 50-point rally. Now please note that the futures are closing on 2771.00, the second number in the sequence. The reason I used the word 'guaranteed' above is that the machines that do most of the trading are programmed to think like human traders, pondering with autistic obsession the dynamic effects of prior highs and lows.

Those who have closely observed the stock market's ups and downs over many years understand that it often acts as though it were detached from observable reality. This is so obvious at the moment that even casual market-watchers have come to realize that the absurdly strong performance of shares lately reflects nothing less than a kind of mass mental illness. Until recently, so strong a characterization would have been greeted with skepticism by those who are not tuned to the daily histrionics of shares.  Think of the skeptics as the extended family of a fictional Aunt Jean, whose behavior, according to family gossip, has grown a little strange lately.  She has always seemed a little eccentric, of course, and why should we worry if she has become a little moreso in her dotage? And then the shocker: With everyone seated around the Thanksgiving dinner table, Aunt Jean wrenches the carving knife from her brother's hands, stabs the turkey ten times, and shrieks "Death to the Paraclete!" This, in a manner of speaking, is the way the stock market has been acting lately. As such, it is no longer regarded as quaintly crazy. Indeed, even Wall Street's most reliable shills and apologists have taken to shaking their heads in disbelief. Some, including the Wall Street Journal, are in calculated denial. A WSJ headline over the weekend noted that the Smallest U.S. Stocks Are Rallying Despite Grim Economic Data.  However, this fails to capture the alarming recklessness pushing the very largest U.S. stocks, including Apple, Amazon and Google, toward or even above their previous highs. TSLA in particular has stoked the white-hot imagination of the lunatic fringe with a rally from 350 to 869 that recently brought the stock within 10 percent of all-time highs. Even the company's founder, Elon Musk, has

Stocks continue to mark time, giving up almost no ground as DaBoyz, with infinite patience, await the news that will ignite the next short squeeze. We'd intended to short the 250.43 target shown in the chart ourselves, assuming it was ever reached. The rally that was supposed to get it there is at five weeks and counting, and while this is not a record for how long it has taken for a stock to achieve an easy objective, it certainly deserves an honorable mention. If another dull day draws to a close, presumably with a modest final-hour frillip, and you are uncertain about whether to take a position over the weekend, I'd suggest flipping a coin and doing the opposite of whatever instruction it provides.

The stock market has settled into a tedious rhythm that could almost make one think there's nothing interesting going on in the world. Dull nights have been setting the tone for dull days, as occurred on Wednesday. Traders are waiting for news to move the markets, but perhaps all the news that matters, at least for the time being, is already out. So we are left with squabbling along the political fault lines of the pandemic. A Texas hairdresser was jailed for defying the quarantine, and the nation as always has divided roughly in half over the question of whether the state overstepped its bounds. All such convictions and fines are certain to be overturned if these cases ever get heard in an appellate court. If you watch Fox News, you've had enough; if CNN/MSNBC, anyone who defies the lockdown is a potential killer. A reasonable assumption is that the truth lies somewhere in the middle. The fact that this question is unlikely to be settled, even broadly, promises to gnaw on the American psyche for years to come.