E-Mini S&P

Yesterday's tout got it just right with the idea that once shorts' cahones get caught in the ringer, there is no way out for them other than via a murderous short squeeze. Thursday's nasty little ripper was more than I'd expected, since the futures ultimately exceeded my minimum rally target at 2050.75 by eight points. It took a truly murderous squeeze to get there, though, since the futures plunged to 2019.25 on the opening after reaching 2047 in off-hours trading overnight. So where to now?  My hunch is that things will be relatively quiet on Friday, mainly because short-covering bears were likely depleted, if not to say deservedly dead, at the final bell yesterday. Notice as well that the high in the final minutes came within two points of fulfilling the 2061 target shown. Since we should always be prepared for the unexpected, however, let me offer 2096.00 as a rally target if the criminals who rig this game decide its feasible to end the week with yet another short squeeze. The futures could pull back to as low as 2033.00 first, however, before the heist got under way.

Wednesday's constipated price action demonstrated what happens when DaBoyz are intent on pushing the futures higher even when bullish buying interest is nil. Most of the day's flatulence effected a churn near the 2024.25 midpoint pivot shown.  However, the direction was up, even if feebly, and so DaBoyz were at least successful in keeping short-covering bears on the ropes. This dynamic is very nearly irreversible once begun, and so we should regard a further rally to the 2050.75 target as all but certain. Positioning ahead of the move is another matter, however, and I'll leave it to you to craft an elegant solution in real time from whatever messy smorgasbord of possibilities arises. _______ UPDATE (9:28 a.m.):  DaSleazeballs used up quite a bit of short-covering anxiety goosing this vehicle to  2047.00 an hour before the opening. Bears remained on the ropes before the bell, though, as stupid and anxious as ever,  so the 2050.75 target still obtains as a minimum objective.

The futures failed on Friday to achieve an 'easy' correction target at 1956.75, implying DaBoyz have enough 'juice' to squeeze stocks higher Monday morning. We've seen bull trap openings in each of the last five sessions, but this one seems likely to consolidate any buoyancy in the first hour for a presumptive second leg up. Even so, there seems to be precious little energy to for a sustained rally get, and so we shouldn't expect much.  The closest Hidden Pivot benchmark is the 2033.25 midpoint Hidden Pivot shown, and that can serve as a minimum upside projection for the near term. It would take a close above it, however, to imply a follow-through to its sibling 'D' target at 2096.00, By then, the 2105.00 target we've been using for weeks will be in play, and with it a good reason to consider shorting aggressively there with a tight stop-loss.

As we've come to expect, the futures sank like a brick after the usual bull-trap opening. It's inconceivable that any buyers other than short-covering bears would be stupid enough to fall for this trap the fifth straight day it has occurred. They constitute enough buying power, however, to set up the obligatory selloff once DaBoyz have distributed shares in the first hour or so. Shortly before midnight Thursday, the carny game pointed to a tradable low at exactly 1956.75, the Hidden Pivot support shown. Your move!

The last three days have seen bull-trap highs occur on or before the opening bell. Do we detect morons at play here?  Actually, it's probably just the same old dirtballs, marking time until they can get a more potent short-squeeze going. It's hard to say why they've been having such difficulty with this, since squeezing gratuitous rallies from brain-dead bears has been their modus operandi for nearly six years.  From our perspective, a still-outstanding Hidden Pivot target at 2105.00 is the number to beat -- or at least achieve.  In the meantime, day-trading this vehicle will be akin to sitting in on a poker game where you know all the other players are cheats and thieves.  We can beat them anyway, but it's probably not worth the effort.

The futures proved virtually untradable Monday, even though we began the day knowing exactly where they were headed.  The opening bar saw the March contract fall to within two points of the 2017.50 target shown, where it hacked and wheezed its way to nowhere over the next five hours.  Could we have gotten short overnight, just ahead of the opening bell?  Answer: no -- at least not easily, since the overnight high occurred in no-man's land, vaguely between a midpoint pivot and its associative D target. Assuming we're in for more of the same on Tuesday, the only tactic I could recommend would entail shorting a minor rally target overnight, but with the intention of sticking with it if the futures screw the pooch again for the next four hours, as occurred Sunday night.

The 2105.00 bull-market target we've been using remains no less valid than when it was first signaled in October.  However, the tedium we've had to endure waiting for the Hidden Pivot to be achieved has become excruciating with each successive dive from new heights. The latest followed a stall on Friday at 2062, well shy of our mark, amidst a sharp rally that had promised to reverse the nasty selloff of 2015's first two sessions. Clearly, volatility is picking up, challenging bulls and bears alike to hold onto positions. There are no buy-and-hold opportunities, to be sure, since the gigantic swings of late have been sufficient to stop out even the hardiest of risk takers. Since the futures came to rest last week at the approximate midpoint of the latest, gratuitous spasm, my expectations are neutral as the new week begins.  Sunday night owls can try bottom-fishing nonetheess at the 2032.00 midpoint support shown, but if it's breached the next chance you'd get to try again would be at 2017.25, a 'D' target that can be bottom-fished with a stop-loss as tight as three ticks.

I'm not even slightly impressed by the so-far 75-point short-squeeze off the recent low, and neither should you be. In fact, were the rally to run for another 50 points, it would still fall shy of the 2105.00 bull-market target we've been using for months. (The equivalent target we'd used for the December contract was 2115.00.)  This Hidden Pivot resistance still looks both compelling and daunting, and I would therefore be surprised if: 1) it were not achieved; or, 2) it were to be exceeded by more than a point or two the first time it is touched.  That doesn't necessarily mean the pivot resistance is impervious to destruction -- only that the rally that has unfolded so far this year has faced no impediments of any significance.  The bull market's levitators are not omnipotent, and so we should save the oohs and ahhs until such time as they blow past 2105.00  Whatever happens, we'll be looking to get short at or near the target and -- as always -- to make money on the trade even if we are wrong.  If you'd like to see how this is done, join us in the Rick's Picks chat room, where trades are called in real time.

The pattern shown is lovely in ways that Hidden Pivot aficionados are bound to appreciate. From a practical standpoint, it all but guarantees a 13-point rally and a potentially tradable top at 2045.25. The rally is likely  to be over by the opening bell, so I'll leave it to night owls to exploit the target in whatever way best suits your style.  Note that a 'mechanical buy' on a pullback to p=2029.50 would require an initial stop-loss at 2024.00.