E-Mini S&P

The futures slightly exceeded the secondary pivot of the pattern shown, implying odds are good for a follow-through to the pattern's 2927.25 target. This is slightly lower than the 2929.00 target given here earlier and comes from using one-off A=2727.50 rather than the original 'marquee' A at 2726.50. The adjustment is small, but I wanted to provide a very accurate target in case you want to reverse a long position and go short there with an extremely tight stop-loss. I am recommending this only if you've made money on the way up, since the pattern looks too obvious to offer an easy-money reversal._______ UPDATE (Apr 8, 5:06 p.m. ET): Since this is The Bull Market That Wouldn't Die, we should always keep a higher target in mind in case the one we're using gets creamed. In this case, I'll suggest using the 2969.25 Hidden Pivot shown in this chart.  I am also revising the target flagged above back to 2929.00 for reasons that I won't bore you with.

The 2866.25 target where the futures topped recently has the potential to be a show-stopper for reasons noted here earlier, including the perhaps too-obvious enticement of the powerful impulse leg it created. But because this bull market has been chugging along for ten years, defying expectations, we should be prepared for the next record-breaking upthrust. In that regard, a decisive thrust exceeding the 2859.25 midpoint pivot shown would have very bullish implications, since it would put the pattern's 2929.00 target theoretically in play. We'll watch cautiously from the sidelines in the meantime, trading this vehicle with a mildly bullish bias until such time as p is reached.______ UPDATE (April 1, 10:14 p.m. ET): Buyers easily exceeded p, putting p2=2894.13 in play as our minimum upside objective for the near term.

It's tempting to think last week's high at 2866.00 (click on inset) will mark the final gasp of an exceptionally powerful bear rally.  If so, it will have occurred in a place where we might have expected Mr. Market to spring a nasty trap on bulls and bears alike. The latter would have thrown in the towel and covered short positions when the S&Ps broke out over the last two weeks above three descending peaks recorded last autumn.  As for bulls, they are probably still drooling at the prospect of new all-time highs, since the 2866 peak that preceded Friday's selloff came within 3% of that threshold. Both could be proven wrong, although it might take a few more weeks before we know for sure. Friday's cascade on Wall Street felt particularly scary because it came amidst an onslaught of downbeat news concerning the dramatic slowdown in the global economy.  Growth in Europe and China seems ready to plummet and take the U.S. economy with it.  There was also an unsettling development in the financial sector as borrowing rates on 90-day T-bills exceeded those on the Ten-Year Note. The last time the yield curve inverted was in 2007, just before the financial system and stock market crashed. A rate inversion has preceded every recession since 1975. A further concern was that yields on German bonds swung negative, begging the question of whether it's too late in the game for so urgent and desperate an attempt at stimulus to work. AAPL a Dead Duck Even if the global economy were to miraculously rebound, U.S. stocks still look like an insane bet at these levels. The geniuses who are paid absurd sums to throw Other People's Money at a small handful of stocks must be thinking the same thing -- that the

Urgent short-covering catapulted the future to within a single tick of the 2866.25 target shown in the chart (click on inset). Odds that this Hidden Pivot resistance will turn out to be the top of a bull market that just entered its 11th year seem remote, so we should assume that even if there's a pause or tradeable pullback from it, buyers will be back again soon and presumably bound for D2=2924.50 (also shown in chart). The pattern from which I've extrapolated these numbers meets my strictest criteria, so you should consider the targets and the various Hidden Pivot levels precise, reliable and useful.  A further implication is that a swoon to the green line (2776.00), however unlikely, should be regarded as a buying opportunity.

If you've been waiting for Mr. Market to spring the Mother of All Bull Traps, check out today's chart. What a beauty this picture would be if Tuesday's sharp reversal turns out to be the start of The Big One.  Granted, odds of getting the timing of so important a peak exactly right will always be against technical swamis. But the chart has enough going for it that permabears could be forgiven for thinking they might finally be right. For starters, notice how the C-D leg of the bull cycle begun in December topped today at exactly 2858.75, a target sent out to subscribers in early February. The ensuing, 30-point plunge tells us that for some reason, sellers were spooked. If the intraday high turns out to be the bull's last gasp, it picked an interesting place to occur -- i.e., just above three important peaks labeled Curly, Larry and Moe in the chart. They were recorded, respectively, in October, November and December, and any rally that surpassed them, especially without correcting, was bound to get the attention of bulls who have been sitting on the fence. The three-peak breakout also would have spooked more than a few bears into covering short positions. A 'Perfect Storm' of Deceptions Add in the fact that the Fed on Wednesday is expected to mumble something dovish, and you have a perfect storm of potential bullish deceptions. If you're a contrarian and a pessimist, the set-up looks irresistible. However, a very important caveat must be added: If the futures blow past the 2858.75 target in just a few days after having taken ten weeks to reach it, bears had better dive for cover, since that would be signaling more upside to at least 3,000 for the S&Ps and a further thousand-point rally in the

Face it, this monster could veer wildly in either direction right now and even an Einstein could not confidently predict which. My heart's desire is to see the S&Ps plunge into the molten pit of hell by summer. The 2313.00 target shown suggests that, at least from a technical standpoint, this is possible. Presumably, the years-overdue collapse would drive out the crooks who have rigged shares while leaving the virtuous, widows and pensioners untouched. Thus cleansed in fire, Wall Street and the banking system would regenerate themselves and return to health; investors would enter a new era where accounting methods are honest, the behavior of stocks reasonably predictable, our economic and political lives guided by plain sense. In the meantime, a trader could get his ass kicked, as your editor did Thursday, betting that the scenario above will commence within the week. The E-Mini S&Ps are positioned precariously enough (click on chart inset) so that it's not such a bad gamble. The 'CI' stands for a 'counterintuitive' trade intended to flout the raucously bullish mood of the day. But the futures have been so squirrelly lately that one can only infer many traders have flocked to the 'Don't pass' line, eager for the broad averages to seven-out. Is there a less stressful way to do this? Check out my strategy in VXXB, which tracks short-term S&P 500 volatility. It is close to a possible turning point, and although call options are not cheap, owning a few of them beats getting flogged all day long by S&P futures in rabid-badger mode. If you don't subscribe, click here for a free two-week trial that will give you access to everything. And please do stop by the Trading Room to say hello. _______ UPDATE (Mar 17, 6:30 p.m. EDT): Each sharp upthrust has

It will be most useful for the time being to step back from the hourly chart and consider the implications of a further, moderate fall in the June ES to 2699.31. That would trip an enticing 'counterintuitive' short and put p=2572.88 in play as a minimum downside objective. The foregoing is all theoretical at this point, but my gut feeling is that it is what we are about to see.  The trade's initial risk of $6300 per contract argues for another approach, but we'll consider the opportunity if and when it arises. For now, however, the yellow flag is out and your trading bias should be bearish. _______ UPDATE (Mar 11, 3:43 p.m.): The futures have gone sharply the 'wrong' way, tripping a counterintuitive buy signal at 2749 that projects to 2819. Consider the target a lock-up if a secondary Hidden Pivot at 2796 doesn't stop buyers. _______ UPDATE (Mar 13, 8:40 p.m.): Short-covering drove the futures seven points past the 2819 target provided above. This has put the 2866.25 Hidden Pivot resistance shown here in play as a minimum upside projection for the near term.

Today's chart takes the long view while lending authority to the possibility that the crazed leap from late December's lows has been just a bear rally. It would have to surpass 'external' peak #2 to qualify as impulsive on the weekly chart, and we shouldn't presume in the meantime to know how things will turn out. (Full disclosure: I hate the market so much that even if the S&Ps were to hit new all-time highs, I would still be very suspicious of a bull trap.) However vexatious the long-term charts might be, getting the lesser charts precisely right is as easy as shooting fish in a barrel. Accordingly, I'll recommend bottom-fishing p=2773.75 (corrected) with a 2774.00 bid, stop 2772.75 stop-loss. The order can stand only if the futures have traded no higher than 2799.00. On the 15-minute chart, you can find the pattern starting with a=2818.00 on 3/4 at 9:45 a.m. _______ UPDATE (Mar 6, 8:44 p.m. ET): The trade was stopped out for a theoretical loss of $62 per contract when a clear and compelling midpoint support showed no resistance to the downtrend. This means the futures are now very likely to fall to at least D=2748.50. However, the descent has been tortuously slow and choppy, so I'll suggest moving to the sidelines. It is surprising that bears were unable to bury this vehicle Wednesday, since there seems to be almost no buying interest other than from short-covering bears. Here's the chart. _______ UPDATE (Mar 7, 10:23 p.m.): As anticipated, the March contract fell to 2748.50 -- but not much farther. Buying power is still practically nil, but bears are evidently too enfeebled to seize the advantage. We'll plan on sitting out Friday's 'action' unless something interesting develops. ______ UPDATE (Mar 8, 9:55 a.m.):  Looks like yet another day

Monday's vicious shakedown was poetry in motion. An hour into the session, stocks were falling so hard that you might have thought the world was about to end. Far from it, as suckers who sold into the avalanche were soon to discover. DaBoyz had laid the groundwork for Monday morning's crime spree by goosing shorts the night before. This caused the E-Minis to gap 13 points above last week's highs, putting bears back on their heels. The perps then spent the next 16 hours distributing stock at prices above the highs before pulling the plug.  Had they been child molesters -- and I mean no insult to pederasts in comparing them to traders -- they could not have had more fun if they'd had free run at an orphanage. Buyers Couldn't Wait The purpose of the distribution was to get the pros sufficiently short to provide some buying power when stocks fell. But they evidently couldn't wait until Tuesday, let alone until later in the week, since urgent short-covering commenced a little more than halfway into the session. You can see the results in the chart (inset). The squeeze recouped nearly half of the day's losses, presumably leaving bears sufficiently anxious to keep stocks buoyant on Tuesday even if a few real sellers show up. We'll be neutral at the bell, since the futures even at their lows failed to exceed the two prior lows we require to generate an impulse leg. A weak one is all we got, suggesting that another round of punitive selling is no more likely than a rally toward new all-time highs.