E-Mini S&P

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.

The sharp bounce from within three ticks of the 1985.00 target shown suggests DaBoyz may be able turn the tide today by putting the squeeze to shorts. They may need to manipulate the futures beneath the intraday low first in order to get some running room, so if you're keen on buying near the bottom, I'd recommend using the camouflage technique, looking for the turn somewhere between 1982.00 and 1984.

The yellow flag that I hung out here yesterday was just ahead of yesterday's nasty selloff.  The 2105.00 rally target (see inset) remains viable nonetheless, and we should plan on shorting there aggressively if we get the chance. Late Monday night, there  didn't appear to be any compelling bottom-fishing opportunities, since the futures were dawdling at a 2011.75 correction target that should have produced more of a bounce than it has so far.  The coordinates yielding this target, on the 60-minute chart, are a=2082.75 on 12/11, and b= 20378.75 on 1/2.

The dirtballs and hosers charged with minding the store Sunday night took the E-Mini S&Ps down 10 points -- no surprise there -- but they've brought the futures back to unchanged perhaps too early in the night for us to infer they're planning to squeeze stocks higher at the bell. It looks more like DaBoyz are trying to extract as much mileage as they can in the wee hours in order to distribute stocks ahead of the opening.  We should be on our guard in any case, since two weeks of trying did not get the futures to the clear and ostensibly 'easy' 2105.00 target shown -- or the even easier 2092.50 target of a lesser pattern. This could be remedied with one nasty short squeeze, but for the time being we should treat it as a suspicious. Whatever the case, it's a cinch that traders and investors were extremely bullish as 2014 drew to a close --reason enough for us to unfurl the yellow flag. ________ UPDATE (11:37 a.m. EST): The futures have gotten whacked this morning, in line with our expectations. They've been down as much as 30 points, while the Dow has been off by as much as 270 points.

<a href="http://www.rickackerman.com/wp-content/uploads/2014/12/After-mid-Deceembers-blitz-the-failure.jpg"><img class="alignleft size-thumbnail wp-image-67029" title="After mid-Deceember's blitz, the failure" src="http://www.rickackerman.com/wp-content/uploads/2014/12/After-mid-Deceembers-blitz-the-failure-122x67.jpg" alt="" width="122" height="67" /></a>Mid-December's powerful two-day rally has given way to a year-ending muddle over the last two weeks. Are DaBoyz perhaps saving their energy for a short squeeze to kick off the New Year? That'd be my guess, but the idea of going home short on New Year's Eve seems so suicidal as to have a certain contrarian appeal. In any case, we'll stick with the two rally targets we've been using for the last week: a minor one at <span style="color: #008000;">2092.75</span> that is shortable, stop 2093.50, if it's reached early enough in Wednesday's session to be cover-able by day's end; and <span style="color: #008000;"><strong>2105.00</strong></span>, a very major Hidden Pivot that's unlikely to be reached by the bell. If it is, however, I'd increase the bet size of any speculative shorts using way-out-of-the-money puts. They should be treated like any 20-to-1 horse -- i.e., not the kind of bet on which you should risk the farm.

Mid-December's powerful two-day rally has given way to a year-ending muddle over the last two weeks. Are DaBoyz perhaps saving their energy for a short squeeze to kick off the New Year? That'd be my guess, but the idea of going home short on New Year's Eve seems so suicidal as to have a certain contrarian appeal. In any case, we'll stick with the two rally targets we've been using for the last week: a minor one at 2092.75 that is shortable, stop 2093.50, if it's reached early enough in Wednesday's session to be cover-able by day's end; and 2105.00, a very major Hidden Pivot that's unlikely to be reached by the bell. If it is, however, I'd increase the bet size of any speculative shorts using way-out-of-the-money puts. They should be treated like any 20-to-1 horse -- i.e., not the kind of bet on which you should risk the farm.

There are many upside projections for this vehicle right now, both major and minor. For trading purposes, I like the one shown. It implies 19 points of upside, worth $950 per contract for (Sunday) night owls nimble enough to catch a ride. The short against-the-trend from 2103.50 will likely be less challenging however, and I'll recommend initiating the trade via a 2103.00 single-contract offer, stop 2104.25. You can widen the stop and increase the size if you are reversing a long position at the target. _______ UPDATE: Zzzzzzzzzzzzzz. Please note that I disseminated a lesser target, a possible impediment at 2092.75, during yesterday's impromptu session.