E-Mini S&P

After a ferocious, short-squeeze rally of 10% from mid-October's lows, the futures show no sign of slowing down. Yesterday they exceeded yet another peak on the daily chart, stretching their still-uncorrected winning streak to ten days. We can use the 2037.50 Hidden Pivot target shown as a minimum upside objective for the near term, since, as far as I'm concerned, it is all but a foregone  conclusion that it will be achieved. We can also plan on getting short at the target, with profits banked on the way up providing a generous cushion against the risk of intercepting the rally.

Yesterday's short-squeeze on news of 'Chinese QE' was strongly impulsive, even if a surge to new all-time highs is not quite a done deal. Notice on the hourly chart (inset) that the future surpassed an internal peak and two externals without taking a breather. This is the kind of feisty price action that often begets a follow-through rally of equal or even greater strength. Shorts will be edgier than usual, but their nervousness will work to the advantage of traders using 'camouflage' tactics to get aboard. Remember: No matter how frantic and seemingly chaotic the ups and downs, they can be reduced to their tradable rudiments when viewed, simply, as impulse legs.

The downtrending pattern shown yields three potential trading opportunities, presumably for night owls, if the 1925.00 high holds as point C: 1) play for a bounce from either p (1917.75) or 2) D (1910.75); or 3) go short on a breach of p. Keep in mind that any bullish bets will be going against a larger downtrend that could start to snowball and which we are already short two contracts (of an initial four) from, effectively, 1960.00.  If either of the supports identified in the chart gives way easily, that would add weight to the big-picture bearish case.  Note:  We'll roll our two short contracts into September, using a 1954.00 basis. _______ UPDATE (June 16, 1:47 a.m.): Friday's rally altered my parameters slightly, as shown, creating a new midpoint support ay 1918.75.  That is the exact low so far Sunday night, but if it's breached, 1907.75 will be the next stop on the way down. For the time being, our tracking position of two short contracts from a profit-adjusted 1954.00 should be tied to an impulse leg-based stop-loss on the 30-minute chart.  Currently, that would dictate an exit on a rally exceeding the 1931.75 peak shown. Keep in mind that the rally would have to be uncorrected once the peak at 1929.75 is surpassed.  _______ UPDATE (June 16, 9:48 a.m. ET): This morning's running of stops has invalidated downside targets given above. I don't see this hoax getting very far, but I'll suggest raising the stop-loss nonetheless to 1935.00. This time, the stop must be achieved by an uncorrected impulse leg on the 15-minute. _______ UPDATE (10:10 a.m.): Raising stop again to 1939.75, and it must be achieved impulsively, no corrections, on the 30-minute chart.

I staked out a long position in the chat room yesterday afternoon with a set of explicit instructions provided in real time.  Although the trade had the potential to produce a $150 profit per contract on a move to the 1946.50 target, I'm recommending that you ditch it now unless you're keen on staying up all night to monitor it.  Like all 'camouflage' trades, the purpose of this one is not to make a big score, but to establish a relatively low-risk, low-stress entry point.  This we did, taking partial profits early on with the goal of holding a small piece of the original position for a potential four-bagger.  If that holds true for this vehicle, you know where it's going. If you don't, check out my 11:24 post in the Rick's Picks Banter Room for a very important target that we'll want to short aggressively. _______ UPDATE (1:14 p.m.): Based on a report from a subscriber in the chat room, I am reinstating tracking coverage for a big-picture short that was initiated at 1954.25, two ticks off the all-time high.  Assuming two contracts remain from an initial position of four, and that their basis has been lifted to 1960.00 by partial profit-taking so far,  I'll recommend an impulse leg-based stop-loss (ILBSL) using the 60-minute chart.  At the moment, that would put the stop at 1952.00.  Keep in mind that the rally would need to be uncorrected once above 1947.75.

I'm tracking two contracts short from 1954.25 with a cost basis that has effectively been raised by partial profit-taking to 1957.00.  A 1951.00 stop-loss suggested in the chat room would have triggered an exit after-hours, as shown in the chart.  I won't presume to know at this time what subscribers actually did, but if you retained the position, please let me know and I will continue to provide tracking guidance.  For what it's worth, the A-B rally leg that triggered the stop could yield an attractive opportunity to get long via 'camouflage'. This would be 'expert play,' however, because of the futures' coy -- if not to say flaky -- behavior.  There is one more important rally target not far above where we can attempt to re-short this vehicle. Once again, I will refrain from publishing it, but its precise location will be common knowledge in the chat room.  Because it is a long-term target that has taken quite a while to reach, a stop-loss wider than our usual micro-tight, penny-ante stop is warranted.

Chat-roomers used a 1954.25 target to get short yesterday two ticks from the intraday high. The futures' subsequent fall of 9 points from the top was worth as much as $460 per contract, but it would appear those who took the trade exited before day's end using the impulse leg-based stop-loss I'd suggested.  If anyone stayed short, please let me know in the chat room and I'll provide tracking guidance.  Early Tuesday morning, it was not impossible to know for certain whether the top will survive. The futures were in a correction that projected to 1942.00 (see inset), contingent on the breach of a midpoint Hidden Pivot support at 1946.50. Night owls can bottom-fish that last number with a 1946.50 bid and a  1945.75 stop-loss. There is one more Hidden Pivot above -- an unfulfilled target of major degree where we could try shorting again if this vehicle takes flight. I'm not going to publicize it here, but it was made available by email request last week, and so you can ask around in the chat room for the precise pivot.  A three-tick stop-loss would ordinarily be appropriate, but you can widen it to suit your style, since this target has the potential to become a major top. _______ UPDATE (10:05 a.m.): The futures went all headless chicken on the opening bell, but the fact that they dipped below my bottom-fishing number overnight implies the underlying theme today will be more weakness. _______ UPDATE (10:49 a.m.):  Since a subscriber in the chat room has reported staying short from yesterday, I'll provide a tracking position for his guidance and the guidance of anyone else still in the trade. For now, I'll suggest an ILBSL (impulse leg-based stop-loss), using the 15-minute chart. That would imply that the rally from the headless-chicken low

The 1948.25 rally target proffered here Friday marked the intraday high until the final minutes of the day.  It is now shortly after midnight Monday, and although the futures have opened higher, extending their latest move into record territory, the new high is merely marginal.  The so-far top is 1950.00, but that's probably enough of an overshoot for us to infer that an alternative target at 1954.25 also given Friday is in play.  Because this would closely coincide with a potentially important DIA target (see tout for the exact number), a tightly stopped short is recommended in either vehicle at its respective target. If this vehicle should push past 1954.25 by as little as 2.00 points, however, I'd infer that the third and last of the targets disseminated on Friday, 1970.50 (see inset), is likely to be achieved.  If you're long when it gets there, use some of the profits thereof to cushion a generous stop-loss.  (Note: The equivalent target for the September contract is 1960.50.)

A potentially important top just above?  Yeah, I know you've heard it before -- from a hundred gurus, relentlessly. But it sure looks like one. I should have noticed it earlier, but as is so often the case, the epiphany came while I was conducting a tutorial session for some recent graduates of my trading course.  Actually, we discovered two 'Hidden Pivot' resistances, six points apart, that, acting in concert, could show some hairy-knuckled stopping power.  Okay, the rally target at 1930.25 that I drum-rolled here yesterday got blown to smithereens by a short-squeeze imbued with headless-chicken power by panic and confusion over Draghi's announced plan to deal with Europe's little deflation problem. These new targets are more compelling than the one at 1930.25, but I am not about to jinx them by billboarding them in a freebie tout that goes out each night to nearly 9,000 subscribers. However, I will divulge their location to anyone who visits the Rick's Picks 'Banter Room' after 9:00 ET Friday morning. You can get a free pass to the room, and a free two-week trial to my service, by clicking here. No credit card necessary! When you get to the home page after signing up, just click on the 'Chat' tab up top, and then click 'Banter' toward the top of the page that comes up. Stick around if you'd like to join a virtual koffee clatch with the friendly, always-helpful bunch in the other room, Rick's Saloon and Betting Parlor.  Hope to see you in the A.M.!

A 1930.75 rally target broached here earlier remains viable, implying that day traders should position from the long side for now. I don't mean to imply a set-it-and-forget-it trade, since the uptrend that presumably will get this vehicle to the target has been an agony of feints and swoons thus far. If you have the good fortune to catch the move, I would suggest using some of your profits to cushion a tight stop-loss on a short initiated at the target.