E-Mini S&P

It'll be another six hours before all Brexit ballots are tallied, but Wall Street seems pretty certain at this hour that Britain will vote to remain in the EU.  If so, the 2137.50 rally target sent out last night (see inset) is where the futures are headed. The target could be hit overnight, meaning night owls could get long initially, then reverse their positions and go short at 2137.50.  There have already been precise hits at p and p2, respectively the pattern's midpoint and secondary Hidden Pivots, confirming the target and shortening the odds of a tradable pullback from very near it.  If you are able to get long for the ride, use some of your profits to cushion a wider stop-loss for the short than you might otherwise deploy. Pivoteers may have noticed that the stall at p2, almost to-the-tick, occurred at the closing bell. Judging from the modest progress the futures have made above it in after-hours trading, the 2137.50 target -- 29 points above at the moment -- could be hit overnight, assuming the vote goes as expected.  A caveat:  If Ladbrokes and the world's stock markets have somehow gotten this bet wrong, brace for an epic  avalanche on Friday.

The futures tripped my 'snooze alarm' Wednesday by exceeding 2088.63, but I went back to sleep minutes later as this meaningless effusion evaporated into nothingness.  I don't know how the Brexit vote will turn out, but the chart accompanying this tout is drawn to anticipate how U.S. stocks might react. The upper limit, assuming Britain remains in the EU, is 2137.50, which would be equivalent to a Dow rally of about 400 points. A vote to exit presumably would send the E-Minis down to 2025.50, equivalent to a drop of  about 450 points. This will be a good test of whether even the wildest moves in the stock market are precisely predictable using Hidden Pivots. Place your bets!

Brexitmania is now evidently as potent as LSD. Just a few micrograms' worth of imagined Brexit 'news' is sufficient to trigger crazy hallucinations in securities markets around the world. Yesterday's psychotic leap, which had the Dow up 270 points by mid-morning, was robustly impulsive, since it surpassed two sharp peaks on the hourly chart (see inset). Given the flighty nature of the buying, however, we shouldn't let ourselves become overly confident that the ebullience will linger into Tuesday. But if it does, we'll know buyers are serious when they reach, then exceed, the 2106.00 target shown. Crucial resistance will come, as always, at the midpoint Hidden Pivot (2088.63), and it, as well as the green and pink lines, can be used to create 'mechanical'  entry points on the way up.  You should attempt this only if you are familiar with the rules governing 'mechanical' trades. Otherwise, tune to the chat room for learned discussion and timely tips that could prove tradable. _______ UPDATE (June 21, 8:01 p.m. EDT):  I've set the snooze alarm to wake me if a rally exceeds 2088.63. If you're more ambitious, you could try bottom-fishing at 2059.25, stop 2057.75. That's a tick above the midpoint Hidden Pivot of the following downtrending pattern on the 30-minute chart: a= 2107.75  (6/9 at 4:00 p.m.); b=2040.75.

Put aside your cherished technical indicators and oscillators for a moment and contemplate the long-term chart of the E-Mini S&Ps with visual imagination alone. For me, that means ignoring systemic threats to the global banking system and geopolitical tumult that should have cut the S&P 500 in half by now. Now ask yourself: Do the gratuitous 300-point swings that this vehicle has traced out over the last 20 months look like a major top to you? To my eye, at least, it is far easier to imagine a big leap first to dizzying heights -- a leap that would turn permabulls giddy enough to set the hook while grinding the last surviving permabears into silt. Alternatively, it is just as easy to imagine a frightening dive to 1400 or so that everyone would mistake for a replay of 1929 but which would in fact be a retracement for a running start at 2500 and beyond. Whatever happens, I cannot convince myself that the tedious swings we've experienced since late 2014 are the last hurrah of the most spectacular bull market in U.S. history. Under the circumstances, we'll need to keep an open mind about whether big moves either up or down are meaningful to the big picture. They will be tradable in any case, and without much risk, since no trend move of significance can begin without tipping us off via a very minor trend change on a chart of lesser degree.

Although the S&Ps have sold off hard following June 8's record high, this has not negated some quite bullish rally targets I had broached here two weeks earlier.  Basis the June contract, the nearest lay at 2169.25. The equivalent target for the September futures is 2159.25, and it is still very much in play, as is an even bigger-picture target at 2240.00 (see inset) that equates to one at 2250.00 previously given. Notice that the September contract could have been bought 'mechanically' earlier this week at 2070.00, stop 2013.75 (!) when it pulled back to the green line (see inset) after drifting for nearly a month above it. This was a risky play, but there was another chance to get long at Thursday's bombed-out, bear-trap low, since it fell within 1.25 points of the correction target I'd disseminated the night before. Unfortunately, the target was for the June contract, which is no longer actively traded. The equivalent downside target for the September, 2045.00, did not work as precisely, since the futures bottomed at 2040.75. Presumably because of this, no subscribers reported getting aboard at the low ahead of the 33-point trampoline bounce that ensued. Looking just ahead, bulls will be back on the offensive if they can push the futures above the 'external' peaks I've labeled #1 and #2, especially if they do so by Friday's close.  Your trading bias should be bullish when the day begins, however, owing to the 'mechanical' buy signal in effect from the big pattern. To get aboard, I'd suggest creating an entry trigger camouflage-style using an uptrending ABC pattern on the five-minute chart or less.

With outstanding bullish targets well above these levels, I recently promised that I would keep a close eye on any technical developments that might threaten the rosy outlook. One such warning sign -- one that I mentioned here yesterday -- occurred on Monday when a minor corrective pattern exceeded its Hidden Pivot target (see inset).  The pattern that produced it is sufficiently clear that there 'should have' been a tradable bounce.  The fact that there was none has bearish implications for the near-term, at least, but we shouldn't dismiss the possibility that it could mark the beginning of a far more serious decline.  The next test will come at 2067.50, a Hidden Pivot support of slightly greater importance than the one breached on Monday. If it too gives way easily, take this as a sign that the selling is gaining in urgency and could start to snowball.  The coordinates for the pattern, on the 120-minute chart, are as follows if you want to draw it yourself: a=2116.75 (6/9 at 4:00 p.m. EDT); b=2086.26; and c=2098.25. The equivalent target, basis the September futures, is 2058.50. _______ UPDATE (June 14, 7:39 p.m. EDT): Both contracts overshot their respective correction targets by a few points, implying that more weakness is coming. The decline would start to look serious if it were to breach 2012.25 (basis June) or 2004.50 (basis September).  Both of those numbers represent important 'external' lows recorded on March 24. Alternatively, an upthrust touching 2082.00 (June) or 2073.00 (September) would suggest bulls are sufficiently rested and re-energized to halt the so-far four-day decline. _______ UPDATE (June 15, 9:09 p.m): If the futures trash the 2068.75 midpoint Hidden Pivot support shown, expect them to fall to exactly 2060.00, where we might look for a tradable bounce. If they go any lower, D=2051.25

Although the Dow and S&P 500 are within easy distance of new record highs, two of the best technicians we know doubt they will be achieved. In a lengthy analysis that considered various technical indicators, including the Coppock Curve, key advance/decline lines and the VIX Index, Stockmarket Cycles' Peter Eliades recently concluded as follows: "We continue to believe that the highs reached in May of last year will continue to mark all-time highs for years to come." He notes, however, that the Coppock, a tool designed to provide long-term buy signals, lay within a hair of generating a buy signal last week. Our friend Larry Amernick, a past president of the Technical Securities Analysts Association of San Francisco, similarly concludes that technical negatives outweigh positives at the moment, making new all-time highs unlikely. For our part, we see new record highs within the next 2-3 weeks. Specifically, Rick's Picks has an outstanding projection of 2169.25 for the E-Mini S&P futures, or 2250.00 if any higher. The lower target, a Hidden Pivot resistance, would surpass the record  2134.00 achieved in May 2015 by 35 points. The accompanying chart shows why we are convinced that new all-time highs await. What persuades most is the power of the impulsive A-B rally that unfolded between mid-May and early June. Although it added just 96 points to the value of the index, it surpassed two major peaks -- an 'internal' and and 'external' -- that I've labeled. Now, as long as the current pullback does not exceed mid-May's 2022.00 low, current weakness should be regarded as corrective and therefore a buying opportunity. We would have to rethink our bullish stance, however, if the decline, now a week old, were to breach not only the 2022.00 low, but a second 'external' low that occurred at 2012.25

Another day of tired price action has not significantly altered the odds of a short-term finishing stroke to p2=2131.31, or to D=2147.50 if any higher. Both of these Hidden Pivot resistance points are derived from the pattern shown. It's a wacky one but compelling nonetheless, since it's the only rally pattern that can be derived from the three-week period covered by the chart. The minor ups and downs that we typically use to get aboard are too gnarly for me to suggest an entry strategy overnight, but you can tune to the chat room 24/7 for potentially tradable ideas in real time. Please note that there are two bigger-picture rally targets above 2147.50 that remain viable: 2169.25 and 2250.00. _______ UPDATE (June 9, 7:41 p.m. EDT): Zzzzzzzzzzz. No change.

Buyers struggled at the 2115.13 midpoint resistance more than they should have if they're intent on reaching the 2147.50 target shown by week's end. Paradoxically, any weakness that brings the futures down to the green line at 2098.94 should be regarded as a 'mechanical' buying opportunity, stop 2082.50.  Given the $800 theoretical entry risk, you should consider using 'camouflage' to whittle it down to more like $80. The rally target is one of three that I've aired lately. The other two, based on larger, bullish patterns, lie at 2069.25 and 2250.00. A key resistance associated with the latter lies at 2136.00.