E-Mini S&P

The futures finally broke out of a consolidation pattern Friday following seven days' of constipated price action.  Although we've been using 2492.50 as a big-picture rally target, the 2429.75 target shown, a minor Hidden Pivot Hidden resistance, can serve as a precise benchmark for the near term. Since we never assume the midpoint resistance will be exceeded on the first try, or even that it will be exceeded at all, it can be used for now as a minimum upside objective on Monday. If it gives way easily, that would be a clear sign that 2429.75 is likely to be reached soon thereafter. In the meantime, a pullback to the green line can be bought 'mechanically,' stop 2375.50. Once the futures have held decisively above the red line (p=2402.63) for the required several bars, it too can be used to set up a 'mechanical' entry bid, stop 2393.50. _______ UPDATE (May 8, 6:56 p.m. ET): The futures spiked above the red line at 2402.63 (see above) on the opening bar, but only by 1.00 point. The bull trap this thimble-rigging maneuver created is likely to weigh on Tuesday's opening, but buyers should be sufficiently refreshed by mid-morning to attempt a run at Monday's 2403.75 high.

Price action became tedious and labored last week in the days following Monday's ferocious short-squeeze, but there should be little doubt that our minimum rally target for the near term, 2405.13, will be achieved. It's what happens after that that will matter most, since a decisive push above the pivot within 2-3 days of its first being touched would signal a likely follow-through to as high as 2492.50.  Odds of reaching the target would shorten somewhat if index futures open with a lurch higher Sunday night at or above a minor bullish tripwire at 2385.50. Still more encouraging would be a close above 2392.75, the midpoint Hidden Pivot resistance of a minor bullish pattern on the 15-minute chart (A=2365.75 on 4/24). _______ UPDATE (May 4, 4:28 p.m.): Yet again, there is no change in the immediate outlook. Zzzzzzzzzzz.

Wednesday's agitated price action made it seem like there was a mysterious force holding back the bullish herd. Although it felt like stocks were eager to move higher, every time they tried they got slapped down.  This generated a bearish impulse leg of minor degree by day's end, but on the bigger charts it looked like nothing of importance had happened.  We'll treat it that way, sticking with the very bullish, big-picture pattern shown. It implies minimum upside to the 2405.13 midpoint Hidden Pivot over the near term, with an odds-on shot at 2492.50 over the next 3-4 weeks if the lower resistance is easily surpassed. For trading purposes, a pullback to the green line would offer an enticing 'mechanical' entry opportunity, stop 2317.50. That would imply initial risk of about $1700 per contract, but there are other, far less stressful ways to get aboard. For guidance on this in real time, tune to the chat room if and when the futures get within 10 points of the green line. ______ UPDATE (Apr 27, 11:49 p.m. ET): Click here for an alternative rally pattern that tripped a mechanical buy signal today at 2378.38, stop 2358.00. Notice that it projects a slightly higher minimum target (i.e., p2=2408.69) than the one at 2405.13 given above.

Bears did what was expected of them Tuesday, driving the futures sharply higher with a spate of short-covering that should have caused DaBoyz to smile. The stock market is now entering day three of a global rally triggered by perceptions that voters will ultimately reject Marine LePen's bid for the French presidency. It would seem to matter little, particularly on Wall Street, that Macron, her opponent and likely victor in a runoff scheduled for May 7, will have no mandate to govern.  Still, as the thinking goes, at least he won't deny France its proper role in presiding over the inevitable collapse of the euro and the EU. In the investment world, that would seem to count as good news these days. Looking  ahead, we should expect the futures to continue their heedless ascent to the 2439.00 target shown. This Hidden Pivot has served as a lodestone since late March. Judging from the way buyers blew past the 2378.38 midpoint pivot on Wednesday, there should be little doubt that 2439.00 will be reached. A pullback to the red line before Thursday would not meet our criterion for a 'mechanical' entry, but there will be other ways to get aboard, so stay tuned to the chat room if you care.

The futures have been churning for a month, unable to muster the gumption for a run at new record highs.  The last one, recorded on March 1, occurred a millimeter from a Hidden Pivot target that had been 13 months in coming. Small wonder, then, that buyers would need a rest. But seven weeks' worth? What are they waiting for? If it's sunny economic news, traders may have to bide their time for a year or two while the U.S. economy weathers a recession. We've been writing about this prospect for quite a while, since it's seemed obvious that rising interest rates would eventually kill the housing and auto sectors. This appears to be happening right now, even if it will be another six to nine months before the Commerce Department figures it out.  The foregoing should tell you why the E-Mini S&Ps seem in no great hurry to test the old high. If and when they do, however, it will not be because of bullish buying power, but because of short-covering by bears too agitated to simply let stocks fall. That is sufficient reason for us to give the 2439.00 rally target the benefit of the doubt for now. But if the futures should pleasantly surprise by getting the crap kicked out of them next week, the fun would begin with a breach of the 2304.25 downside target shown. That target is not new, just neglected and forgotten in the throes of last week's excruciating scuddle. _______ UPDATE (Apr 23, 7:40 p.m. ET): DaBoyz have squeezed the futures sharply higher Sunday evening, exuberantly over-celebrating LePen's failure to capture the French presidency on the first ballot. We should pay attention not to the election, but to whether this short-squeeze pushes the June contract through the 2378.38 midpoint Hidden Pivot resistance

The futures impaled a clear Hidden Pivot resistance at 2356.25, surpassing April 12's 'external' peak at 2356.50 in the process to generate a robust impulse leg on the intraday charts. Clearly, bulls are in great shape to end the week on an upswing, although it may require a soft opening to prevent stocks from getting too juiced at the bell to attract buyers. I have no 'easy' trade to offer overnight, since it's impossible to predict where the point 'C' low of the pattern shown will occur. It looks promising nonetheless and would become still moreso for tripping a buy-stop entry if DaBoyz open this vehicle moderately lower, then reverse it suddenly in the first five minutes of the session.

A 2304.25 downside target remains valid in theory, but sellers have been looking so timid lately that we'll go instead with the minor uptrend at the rightmost edge of the chart (see inset) for Wednesday. It projects to 2353.25, a very modest target that may still be out of reach if DaBoyz don't get help from short-covering bears. My gut feeling is that with mortgage applications data scheduled for release ahead of the opening bell, bears may not feel like doing any heavy lifting for the bad guys. And if the mortgage data is surprisingly downbeat, as why should it not be with rates significantly off their lows and home prices in the stratosphere, then you can return your focus to the 2304.25 target.  Please note as well that any selloff would have a chance to bounce from 2314.00, an additional HP support derived from an alternative A at 2378.75 on the hourly chart. _______ UPDATE (Apr 19, 8:04 p.m. ET): After enduring today's Punch-and-Judy show, I see little tradable value in pretending I give a rat's ass where this thing is going next. Even if I'm right and it falls to 2304.25, that's hardly a guarantee we'll be able to make 'easy' money on the move.

Monday's constipated short-squeeze ended with the futures hovering just above last Thursday's peak. Thus did a tiresome rally generate a bullish impulse leg on the intraday charts, although not on the daily.  Under the circumstances, my outlook and trading bias for the very near-term will necessarily be bullish, but with a cautious eye toward the 2304.00 downside target identified in yesterday's tout. It will remain in play until such time as 2375.00 has been exceeded to the upside. Night owls may be able to catch a possible next leg up using the 'camouflage' pattern shown to reduce the risk. If the eventual point 'C' low falls within a few ticks of A=2342.00, you should jump on the trade 'counterintuitive'-style.

The most recent forecast got the downtrend right, but also an intraday low that came within two points of the 2326.50 target I'd flagged the night before. I'd suggested bottom-fishing there because it stood to be easier than staying short for the ride south. This proved to be the case, since the decline was punctuated by two gratuitous rallies that would have made for a stressful day. Before the futures made their final low at 2324.00, they took a five-point bounce from 2326.00 -- two ticks below my target -- that could have been worth as much as $250 per contract to anyone who followed my guidance.  At that time, in the chat room, I advised subscribers to take the money and run, since it would have been risky to hold a long position over the three-day weekend. Looking just ahead, because the bearish abc pattern that produced the 2326.50 target was as clear and clean as they come, we should infer from the slight overshoot that still lower prices are coming.  We shall see, but in the meantime I'll have no trade recommendation for this vehicle ahead of Monday's opening. _______ UPDATE (Apr 16, 9:20 p.m. ET):  Because the futures slightly exceeded our 2326.50 target on Thursday, we should presume that still lower prices are coming. If this is correct, they should fall to the 2304.25 target shown once p2=2321.94 has been decisively breached.