E-Mini S&P

The futures were slithering higher Monday night on zero volume, doing what they lacked the guts to do during daylight hours on Friday. Specifically, they've inched above a significant external peak on the hourly chart -- in this case, Friday's high. Assuming that there are at least a few bears ready and eager to hit the panic button, we should see the 1316.75 rally target (see inset) given here earlier achieved before the day is over.  Alternatively, it would take a print down at 1269.25 today to break the bullish fever.

One step forward, two steps back.  At this rate, 2012 could come and go before the futures reach some of our more ambitious targets.  A less ambitious one at 1316.75 is where we should set our sights for now, and it would become an odds-on shot if and when the futures settle above a lesser target at 1301.75 broached here yesterday. The higher number's provenance is shown in the chart. Night owls should look for 'camouflage' opportunities on the 15-minute chart or less -- specifically via an external peak at 1292.75 that was within a hair of being exceeded.

[Rick’s Picks sometimes ascribes human, animal or even demonic qualities to the vehicles we trade, most particularly the ever-vexatious Mini-Index futures. The following, first published here nearly a decade ago, reminds us why. RA] In all the galaxy, could there exist a nastier little critter than the S&P futures? Yesterday, watching the [March] contract leave its hellishly agitated footprints all over my intraday charts, I was reminded of the creature in the movie Alien. In its “cute,” post-larval stage, the then knee-high monster resembled a small dragon, with tiny buzz saws and metallic razors in place of reptilian scales, and venomous syringes instead of teeth.  Those who saw the movie will not forget the way the creature skittered around the space station floor, finally disappearing for a few excruciating minutes before exploding, with a wicked, other-worldly cackle, from the chest of a hitherto unsuspecting male crewman. And so it was yesterday with the [E-Mini S&Ps], as they feinted and darted, bounded and careened, emerging with a bloody victory over all but the very hardiest of day traders. Talk about vicious! The S&Ps would make house pets of monsters such as the one in Alien. Thus, on Thursday, amidst brutal tedium and, until the final hour, trendlessness that was unusual even for this so-far excruciating post-holiday period, did the [March] S&Ps parry an intrepid army of traders, never sustaining a rally or decline for long enough to allow them to draw an untroubled breath. The invincible tormentor of these determined warriors is a Freudian nightmare come alive, an all-knowing predator whose every movement, at any instant of the day, is willed by a thousand ids and egos, each struggling to come out on top.  But even when the S&Ps are momentarily at rest they throb with menace, fueled by the unspent

The noodling around of the past few days has pushed our minor rally target slightly higher, to 1301.75, predicated on a healthy push past its sibling midpoint at 1290.50.  That's 1.00 point above the high achieved in the closing minutes of yesterday's session, but until buyers put it behind them, we won't leap to conclusions.  For night owls looking to get long, a decent 'camo' pattern developing early Wednesday evening looked promising.  Want to learn how we use Hidden Pivots and “camouflage” to reduce entry risk to relatively small change? Click here

The fresh perspective in today's E-Mini S&P tout is intended not only to stretch the bullish imagination, but to encourage you to trade 'camo' patterns more aggressively as the market moves higher. This is a good time to ponder the charts without getting too caught up in their meaning.

We've been focused on relatively trivial -- albeit tradable -- rally targets recently, but the accompanying chart is intended to coax the bullish imagination a bit. It shows an ABC rally pattern stretching back to early October with a 1362.25 target. That's equivalent to a Dow rally of about 700 points, which would boost the blue chip average comfortably above 13,000. The midpoint resistance associated with the target lies at 1252.00, and although the Hidden Pivot 'effect' at that price is not especially compelling, we should not overlook the fact that the futures have used it this week as a launching pad.

At around 10:30 p.m. EST, the E-Mini S&Ps were slithering above a 1278.50 midpoint resistance that had stymied bulls for more than a week. Assuming this sleazy, short-squeezy, volume-less action is the breakout we've all known was coming, I've suggested that night owls use the 10-minute chart (or less) to initiate longs via camouflage.

In tonight's commentary, I described the stock market as patiently biding its time in gluttonous anticipation of news sufficient to reignite the massive short-squeeze that kicked off the New Year.  Or so it would seem. Sentiment is so ridiculously bullish right now as to reflect the gutlessness of sellers.  They'll return with a vengeance one day soon, for sure. But for now, DaBoyz are unwitting instruments in fulfilling a Hidden Pivot rally target at 1296.75 given here earlier.  They've spent the last five sessions playing toe-sies with the target's midpoint sibling, 1278.50, doubtless unaware that such an impediment even existed. Night owls should look for camouflage on the 10-minute chart, where a low-risk long was triggered about two hours ago at 1278.00 (A=1275.00, B=12799.00, C=1277.00). You might have to babysit the position overnight, however, since the futures look skittish about breaking out to new highs without help from the army of fools who will clamber aboard at the opening bell. Want to learn how we use Hidden Pivots and “camouflage” to reduce entry risk to relatively small change? Click here

What looks like a conventional double top on the daily chart is actually a bullish impulse leg that projects to 1296.75.  The midpoint Hidden Pivot resistance associated with that number lies at 1278.25, and we should infer that a close above it would make a follow-through to the target an odds-on bet.  More immediately, because the pullback from Friday's very nasty bull-trap high offers no particularly promising spots for bottom-fishing., I'll suggest looking for a camouflage opportunities based on ABC rallies on the one-minute chart.  We're zooming down all the way here because, as of around 9:13 p.m. Sunday night, I could find no camo opportunities on the two-minute chart.