E-Mini S&P

The precise stall at p=2750.25 will make this an easy call:  If the 'hidden' resistance is breached, you can bank on a further rally of at least 75 points to D=2825.50. It's always possible, of course, that buyers will chicken out on the first attempt. But if they push past our benchmark by 15-20 points and then pull back to the green line, that would set up a very appealing 'mechanical' buy, stop 2674.75. Notice as well that this latest rally surpassed a key external peak at 2744.00 recorded back in March. That makes the rally very bullishly impulsive -- yet another reason for a strong bullish bias here, even if a correction intercedes for a few days this week. _______ UPDATE (June 6, 10:33 p.m. EDT):  The trade mentioned above could come into play, since today's upthrust exceeded the midpoint pivot by 25 points.  If you trade the E-Mini S&Ps and you're keen on leveraging this set-up, please let me know in the chat room, where real-time guidance is possible. ________ UPDATE (June 7, 11:00 p.m.): The 2825.50 target remains valid, but if the futures go any higher than today's 2779.75 peak, I will cancel the mechanical bid at 2712.50. _______ UPDATE (June 10, 11:10 p.m.): I've raised the possibility in today's commentary that bad news emanating from G7 could cause stocks to reverse the rally of the last two  weeks. If so, here's a chart that shows how far the futures could fall. A decline to the green line (2715.94) would trip a theoretical short to p=2652.13.

There should little that is unfamiliar in today's chart, which we've considered dozens of times since stocks broke sharply lower in February.  Punctuated by occasional, wild price swings, stocks have been grinding along ever since, meting out growing dollops of frustration to any trader, investor or forecaster who would seek to benefit from the ongoing drama (or, mostly, lack thereof).  Today, however, I want to share one simple observation that is as straightforward and free from emotional bias as I can make it. To wit, the S&P 500 (using the E-Mini S&Ps as a vehicle) became a 'mechanical' buy when it fell to the green line on March 22. That is bullish, plain and simple. The 'mechanical' trade implied is a specialty of Rick's Picks because it has worked so consistently for subscribers. Without going into the proprietary details of why the 'mechanical' buy shown is such a beautiful specimen, I'll say only that it leaves little room for doubting bulls, let alone for permabearish skeptics like myself. A key feature of such set-ups is that they excel at handling the scary, second-wave dive that so frequently interrupts otherwise very-bullish-looking charts. In this case, the all-but-obligatory dive took the E-Minis down by nearly 10% in March, narrowly missing a theoretical stop-loss that would have triggered just beneath 2532.50, the pattern's point 'C' low. 'Mechanical' Indicator Unintimidated A very similar pattern has replicated itself many times in other stocks -- all instances where presumably even the most steadfast bulls would have thought twice about sticking around. The most persuasive instances of recent note came in CRISPR Therapeutics, as well as in some of the more popular bitcoin trading vehicles before they went brain-dead. Bottom line: The E-mini S&Ps are not only on a long-term buy signal, they look likely to achieve

Pivoteers may have noticed that today's sell-off tripped a 'counterintuitive' short at the green line (2692.00).  At least one bold subscriber had staked out a position in advance based on my earlier note that the Dow looked as though it was fixing to lay an egg when stocks opened Sunday night.  As indeed it did. Even though the subscriber said he'd cashed out his DIA put position for a quick $7500 profit, it would appear that holding a few puts for a swing at the fences could conceivably produce some additional gains. In any event, based on the CI trade signal, we should expect the weakness to continue down to at least p=2645.75 in the days ahead. If you prefer to trade against the swings, you could try bottom-fishing there with a 'camouflage' set-up.  I'd suggest using an abc reversal pattern on the 5-minute chart or less, if and when the E-Minis get within 2-3 points of p.

There is little point in getting all worked up about technical subtleties at the moment, since the very simple key to the chart shown lies in bulls' conspicuous failure to surpass the 2744.25 peak after three weeks of trying. Even if they are able to get past it in the week(s) ahead, that would not mitigate the obvious weakness they have displayed so far. Presumably, their ability to make headway after doing so would be very limited -- almost certainly falling shy of new record highs.  Bears are wholly enfeebled as well, so get ready for a potentially long, boring stretch that will satisfy no one. If, in a year, the broad averages are trading about where they are now, don't be surprised. _______UPDATE (May 21, 5:39 p.m.): A day of huffing and puffing failed to lift the futures above the key peak noted above. DaBoyz may succeed at this in the days ahead, but don't be impressed with their bluff unless bears lose their cool. Short-covering is what pushes markets through ALL significant resistance, and it can never be ruled out entirely. _________ UPDATE (May 22, 6:43 p.m.): A mildly bearish day changed nothing in the outlook given above. _____UPDATE (May 23, 7:42 p.m.): Zzzzzzzzzz.  Zzzzzzzzzzz.  Zzzzzzzzzzzzzzzzzzz.  Zzzzzzzzzzzz.

The futures have opened Sunday night with a subdued lurch higher. They're up eight points at the moment, trading near their highs, but that's enough to leave the 2721.50 target we'd used to stay on the right side of the trend in the dust.  The next significant Hidden Pivot resistance lies at 2750.25 (see inset), and it can serve as a minimum upside projection for the near term. However, it would take only 2744.25 to put the bearish case in serious jeopardy.  A print there would exceed a key external peak from March 21, generating a powerful new impulse leg on the daily chart.  The bull-market target thereupon would be 2826.25 (A=2533.00 on 2/9) -- a seven-iron shot from the record-high 2883.25 achieved in January. Anything above the old high is a potential spot for Mr Market to spring a trap on bulls and short-covering bears. If so, we'll have a fighting chance to be ready for it.

Wednesday's rally pushed past the three peaks shown, all of them 'external', generating a deceptively powerful impulse leg with relatively ease.  Accordingly, pullbacks should be treated as buying opportunities, particularly by night owls able to exploit a relatively shallow B-C correction from within a tick or two of the so-far high at 2700.00 (i.e., a 'camouflage' set-up.)  The 2721.50 rally target given here earlier still obtains and can be used not only as a minimum objective, but as a place to reverse a long position with a very tight stop-loss if you've profited on the way up._______ UPDATE (May10, 7:59 p.m.): The rally topped at 2725.00, just above our target. Usually I would say this is somewhat bullish, since the target was so precisely clear. In this case, though, I'll reserve my enthusiasm, since the breach of the pivot was likely caused by too man traders seeing, and using, the same pattern we saw. And the lesson? Subtlety and gnarliness are our best friends when we look for patterns to trade this vehicle.

The 2724.50 rally target we've been using seems within easy reach, but the futures have looked so tired lately that you should consider getting short off a 'counterintuitive' pattern like the one shown.  Night owls in particular should pay close heed, since, if the trade triggers, it has a good chance of happening overnight. There are many ways this could happen, but instead of my trying to guess which, I'll mark this one 'for experts only'. _______ UPDATE (May 9, 10:03 a.m.): The futures are too sloppy to trade this morning, at least for me.  Although I cannot come up with a Hidden Pivot rationale, even in retrospect, for getting short at this morning's top, the fact that the futures rolled over from a high 2.50 points shy of the target is likely telegraphing more bearish action ahead. ________ UPDATE (12:04 p.m.):  ...or not.  The futures now appear bound for the 2721.50 target shown in the link above. What threw me off was the 2.50-point miss mentioned in that last update.  Given the sinuous, delicate perfection of the pattern, I am quite surprised that the stall did not occur within no more than a tick or two of the 2686.88 midpoint resistance.

I've lowered my bear-market target to 2456.50 because I was not comfortable with the original target at 2526.50. It required the use of a one-off point 'A' high that simply doesn't look right on the daily chart. The one shown uses what I refer to as a 'marquee' high, but I think it has a good chance nonetheless of nailing the exact bottom of the bear cycle begun in late January.  The swings on the hourly chart have been tradeable, but not according to any Hidden Pivot logic that I would warrant as easy or obvious. You can try tightly stopped bottom-fishing at 2575.00, but that's all I am able to suggest for now (60-min, A=2718.00 on 4/18; B=2611.25 on 4/25; C= 2681.75). _______ UPDATE (May 6, 5:07 p.m. EDT): The hourly chart turned bullish as last week ended, with the futures bound, apparently, for a minimum 2724.50 (A=2584.50 on 4/6).  However, as the chart above makes clear, any rally that falls shy of the 2744.00 peak recorded on March 21 should be regarded as mere noise. _______ UPDATE (May 7, 89:08 p.m.): Pivoteers, please take note: Today's rally topped midway between p and p2 of this pattern, implying that a pullback to the green line would offer an excellent 'mechanical' buying opportunity. If geopolitical news heats up, though, be aware that leaving a bid at the green line could be especially risky.

The 2526.50 target I'd flagged if things got ugly is still in play, but we'll focus for the time being on the promising bounce from Tuesday's 2623.25 low. If it exceeds  2688.50 by Thursday's close, bulls would be back in charge, at least for the near term. And if they can push this erstwhile brick above the 2807.25 peak recorded in mid-March, shorts would be wise to dive for cover.  For now, I'll recommend using the pattern shown to guide you. An easy move past the 2678.25 midpoint pivot would portend more upside to at least 2745.25.  Alternatively, a relapse would bring the 2526.50 target back into focus._______ UPDATE (May 7, 7:56 p.m. EDT): Today's rally to 2681.50 brought the futures to the midway point between p and p2 (click here for chart), implying that a pullback to the green line would offer an excellent 'mechanical' buying opportunity.