Today's modest pop exceeded two more external peaks on the daily chart, bringing the total to three -- all by a rally that has yet to correct. This implies a powerful impulse leg in the making -- one that could soon dispel any doubts about the importance of the September 1 low at 91.71. If this is in fact the start of a major bull move in the dollar, all of the trends that have been in motion since the bombed-out March 23 low are going to reverse: Shares, including the FAANGs, will fall, the precious metals will turn weak and T-Bonds will get new respect as a safe haven. None of this will necessarily happen overnight, but as the implications of the dollar's strength become more apparent, that will turn the tide. Debtors are headed for trouble, and the effects of Fed stimulus are about to go deader than Kelso's testicles. _______ UPDATE (Sep 23, 9:23 p.m. ET): This week's surge has exceeded two prior peaks on the daily chart, two of them 'external', without taking a breather. Now, if the rally punches through D=94.61 with little effort, that would further strengthen the argument that we are witnessing the beginning of a major move. _______ UPDATE (Sep 24, 9:47 p.m.): Thursday's rally to within two cents of the 94.61 target I'd drum-rolled has the entire world on edge. Exciting though this may be, it does not call for speculation; we'll let price action over the next day or two speak for itself.
Buyers re-enthused so quickly after getting raped on Tuesday's bull-trap opening that I've raised my short-term projection. The pattern shown implies AAPL will hit 117.46 if it can get past p=113.31, my minimum upside projection for Wednesday. If the stock does in fact achieve 117.46, the optimists will surely be thinking at that point that new all-time highs are likely. We'll be extra careful ourselves, since our day-to-day outlook is based in part on the certainty that when conditions are perfect, as they may well be now, Mr Market will set a trap that to snare everyone, not just bulls. That would imply the current bounce will pick up momentum in order to trigger a short-covering stampede. Whatever the case, we will have our eyes wide open in the days and weeks ahead to avoid getting fooled.
Bears should have been able to close the Dow down at least 1000 points on Monday. Instead they turned gutless before the session was even halfway over, driving the futures into a short-covering spasm that was continuing into the evening and had recouped more than half of the day's losses by around 8:30 p.m. The buying binge is attributable in part to the fact that DaBoyz had bullish control of AAPL all day long and would not let it touch 100. This is no surprise, considering DaDirtballs are covering shares that were shorted as high as $138 in the post-split rampage. Regarding the E-Mini S&Ps, they would trip a weak 'mechanical' short if they reach x=3347.50, the green line. The bearish target thereafter, D=3131.50 (see inset) is derived by sliding the point 'A' high up to the 3574.00 high recorded on September 3. We'll paper trade the short because it is not ideal due to the weak impulse leg. _______ UPDATE (Sep 23, 9:43 pm. ET): The two-day detour has not altered the odds of a fall to at least 3131.50.
The target we've been using at 3238.50 (corrected from a dyslexic 3228.50 given here earlier) still looks like minimum downside from here, but also a place to attempt bottom-fishing with a tight stop-loss, especially if you've been short on the way down. It can be used as well to 'mechanically' short the futures from either p=3329 or x=3374.25, although I am not recommending either trade explicitly until I've seen how the little sonofabitch opens Sunday night. As always, a decisive penetration of the 'D' support, especially on first contact, would telegraph even more weakness to come.
We've been using a 100.99 target for this selloff, but the 98.65 pivot shown in the new chart should be considered as an alternative because the first bounce from the pattern's p=110.68 was fairly precise. Either will work in conjunction with the Sep 25 95/100/105 call butterfly I recommended buying last week for 0.30. The stock's descent since then has pushed up the value of the spread, and you'd be doing well now to buy it for around 0.80. If anyone got aboard last week for less than 0.70, please let me know and I'll establish a tracking position. Note to Pivoteers: If the point 'A' high shown in the chart had greater separation from the spiky 'marquee' high, this would be the kind of gnarly pattern whose target could not fail to provide a tradeable bounce. As it stands, the pattern generated a profitable 'mechanical' short last Tuesday that is still in effect. Bottom-fishing at p2=104.66 is recommended only to those of you who know how to tightly control the entry risk with an rABC set-up. ______ UPDATE (Sep 21, 8:36 p.m.): We'll spectate for now, since AAPL has shorts by the scrota again. An upthrust touching 112.20 would be warning of a squeeze capable of doing quite a bit more damage to bears. The pros are working the stock hard, and the post-split squeeze to $138, followed by an engineered plunge to a so-far low of 103.11, ranks as one of the most lucrative criminal scores of all time. This is a multi-trillion dollar stock, remember.
[QQQ] The chart shows two Hidden Pivot 'D' supports, either of which is capable of generating a tradeable bottom. Subscribers reported success using SQQQ, an ultrashort ETF, to play the move. The downside targets lie, respectively, at 260.69 and 258.42. However, sliding 'A' up to the marquee high at 303.50 recorded on Sep 2 would produce a downside target as low as 243.85. Friday's bounce precisely from p=262.15 of that pattern has validated this target and the pattern associated with it while also providing a rationale for bottom-fishing at 243.85 with a very tight stop loss. ______ UPDATE (Sep 21, 8:42 p.m.): Subscribers reported making hay with the 260.60 target, which caught the low of a nearly 7-point plunge within 58 cents. The bounce is strongly impulsive, but I expect it to fade well shy of last week's peaks near 280.00 In any event, we'll repair to the sidelines for now.
[DIA] Bears turned chicken Friday afternoon, scrambling needlessly to cover shorts ahead of a weekend that was unlikely to produce 'good' news. Now, a rally to p=278.76 would trip a weak 'mechanical' short, stop 280.59. I'd suggest paper-trading this one unless you've caught a profitable ride up to 278,76. The trade should be executed with a rABC set-up on the 15-minute chart (or less). As always, if the eventual, expected fall to D=273.29 exceeds the target, especially on a closing basis, that would warn of more weakness to come. _______ UPDATE (Sep 21, 8:49 p.m. ET): Sellers are probably done for now, having achieved the 'D' target of a three-week-old pattern almost exactly. It is calculated using the highest possible 'A' on the chart; my original target used a secondary high recorded on Sep 3 and was relatively conservative. Here's the chart. _____ UPDATE (Sep 22, 5:16 p.m.): This pattern, with a 274.68 rally target, can serve for trading purposes, implying a 'mechanical' long from x=271.01, or a short from D=274.68 for those who have enjoyed the ride up. Please note that a gap opening in the morning -- something that occurs regularly in this vehicle -- could negate the pattern or at least diminish its usefulness.
The corrective pattern furnished here Thursday night is still on-track to fall to its D target, which for the December contract is 3233.00, nine points lower. Friday's fake overnight waft narrowly missed triggering a juicy short when it failed by a few points to reach the green line. Now, although a run-up to the line would trigger a second signal, I am not recommending the trade unless you know how to cut the risk with an rABC set-up. Bottom-fishing at p2=3278.25 with a tight stop-loss or 'counterintuitive' set-up will be simpler, as will similar tactics at D=3233.00. A decisive overshoot of D would be bearish. _______ UPDATE (Sep 15, 4:38 p.m. ET): The trade came within an inch of getting stopped out, but I am still in love with the pattern, although no longer the odds. An old Hidden Pivot rule says that if a beautiful set-up doesn't work, do the opposite. In this case, however, I am not recommending trading with a bullish bias because I don't trust the rally. Move to the sidelines for now. Here's the chart. _______ UPDATE (Sep 16, 5:04 p.m.): This is exactly what I was talking about when I said Mr. Market was doing his utmost to keep bears from getting short. This kind of price action is damned near impossible to short, at least with entry risk under tight control. _______ UPDATE (Sep 17, 10:33 p.m.): Call me a masochist, but I'm still in love with the pattern shown. It's stopped out bears no fewer than twice this week, and the D target at 3238.50 is slightly higher than the original, but that's where the futures are headed -- for sure! -- even if they get there without any of us patient, cautious, super-smart bears aboard.
Friday's slight dip beneath p=111.85 will not necessarily be fatal, but it did shorten the odds of a further fall to D=100.99. If this comes to pass, Apple shares will have shed 27% of their value since peaking on September 2 at 137.98. The pattern shown in the chart is gnarly, with a one-off 'A' from the planet Mars, and that is why I expect it to work well for 'mechanical' shorting or bottom-fishing on the way down. Although the C-D leg has yielded no such opportunities so far, a rally to the green line Sunday night or Monday morning would trip a 'mechanical' short, stop 122.71. Alternatively, if the stock falls straightaway to p2=106.42, you could bottom-fish there with a tight 'rABC pattern. ______ UPDATE (Sep 15, 4:47 p.m. ET): A head-fake on the opening triggered a mechanical short at 117.27, as shown in the original chart. The position was showing a $1440 profit on 400 shares toward day's end, but this was only after the stock head-faked a second time, narrowly failing to surpass the early-morning high. I have not established a tracking position because only one subscribers appears to have done the trade, but the 100.99 target remains valid. If you hold a position, cover half at p=111.85, but make this o-c-o with a stop-loss at 122.71. _______ UPDATE (Sep 16, 5:08 p.m.): The 112.04 low is close enough to p that you could have covered half of the short position. If you haven't done so already, I'll recommend doing so now at around 112.57. The 100.99 target is still valid, but odds would improve if AAPL closes for two consecutive days beneath p=111.85. _______ UPDATE (Sep 17, 10:47 p.m.): To leverage the 100.99 target, I'll recommend buying eight Sep 25 95/100/105 call butterflys for 0.30, good-till-canceled.
The Cubes' failure to fall to the 265.20 target on Friday is dumbfounding, but there is no point in arguing with Mr. Market. The target remains valid nonetheless and could prove opportune for tightly-stopped bottom-fishing. This is notwithstanding the fact that Friday afternoon's robust recovery seems a bit excessive to set up a plunge on Monday to a marginal new low less than two points beneath Friday's bottom. If 265.20 gives way easily, I'll recommend doubling down with a tightly stopped bid at 262.93. That's the 'D target of the same pattern, but with 'A' raised to 288.93 (9/4, 10:00 a.m.) _______ UPDATE (Sep 14, 8:20 p.m. ET): Nothing keeps this rabid beast down for long. A thrust exceeding 282.20 would negate the pattern on which the recommendations above were based. _______ UPDATE (Sep 15, 5:54 p.m.): Ordinarily a gap through p such as occurred here would guarantee 'D' will be reached. In this instance, however, the stench of distribution throughout the day was so powerful that I stop short of certifying the 281.93 target as a done deal. Let's see how it goes. _______ UPDATE (Sep 16, 8:23 a.m.): An overnight short-squeeze got this gas-bag to 281.72, just 23 cents shy of the target. Buyers were back at it urgently following a fall of nearly $2, but their exceeding the Hidden Pivot should not be considered a done deal until it happens. _______ UPDATE (Sep 16, 5:14 p.m.): The 281.93 target caught the start of a $7.50 plunge within 21 cents. Since no one mentioned having taken advantage of this in the chat room, I have not established a tracking position. Reports? _______ UPDATE (Sep 17, 10:54 p.m.): One subscriber reported cashing out a winning option ticket in SQQQ. There is likely more where that came from, since SQQQ,
