E-Mini S&P

Today's touts include a very bullish target for the S&P 500 Index. However, the futures show more immediate resistance at the 1816.75 target shown. Nimble traders can try shorting there with a tight stop on Monday, but because the A-B impulse leg is somewhat gnarly, camouflage is suggested. If there's an opportunity to get long for the ride up, you can use any profits thereof to cushion the stop on the short reversal.

After topping not far above a major target at 1767.00 that we'd been using, the futures have made zero headway over the last two weeks. However, the thing to notice is that they have not given up any ground either.  If the consolidation this implies gives way to a renewed surge, we should use the 1816.75 target shown as a minimum upside objective. If there's an intervening pullback to the 1728.50 midpoint pivot shown, you should view that as an opportunity to board belatedly ahead of the presumptive Next Big Push.

The December contract has blown through a promising rally target at 1739.25 with the greatest of ease, implying it's got eyes for the 1819.50 target shown.  Traders should hold a bullish bias, since there is a theoretical 55 points of upside potential to capture. Getting aboard a rally as mature as this one will always be tricky, but your goal should be to rack up as many points of profit as possible in order to cushion the stop-loss when we attempt to short 1819.50. It would not diminish the bullishness of this chart one iota if the futures were to return to the 1729.75 midpoint pivot, Indeed, that should be viewed as an excellent buying opportunity ahead of a potential last-gasp rally.  _______  UPDATE (10:34 a.m. EST): In the analysis above, I inadvertently overlooked a 1769.50 target, but it is why the futures have stalled here; and why, furthermore, this could prove to be an important top.  The Hidden Pivot was actually exceeded by 5 points at last week's record highs, and although that's enough to tip the odds slightly in favor of yet another leg up (to 1819), considering the long-term, big-picture context of the weekly chart shown, a 5-point overshoot is not quite enough to make the 1819 target a 'done deal'.

In the chat room yesterday, at around 2:10 p.m., I advised a 'mechanical' short in this vehicle if it rallied several points to the 1750.25 midpoint pivot (red line) shown. The trade worked beautifully and was still in play as of this writing. It was 'mechanical' in the sense that a risk:reward ratio of 1:3 was held constant over the life of the trade, from entry to exit. It proceeded from the idea that if a trading vehicle is going to muster one last-gasp rally before heading lower, the most logical place for the rally to end is at a midpoint pivot that has already been violated. Thus, we determined to get short if the futures pushed back up to 1750.25, which, as you can see, they did. But instead of using 'camouflage' to initiate the trade, which can be tricky, we simply shorted at the red line in anticipation of a drop to the D target shown, 1739.25.  With 11 points, or $550, of profit potential per contract, we could afford to risk a third of that on our initial stop-loss.  We do this routinely, always keeping the 1:3 ratio noted above in mind. In this case, it implied shorting 1750.25 with a 'mechanical' stop at 1753.75. This may not be the least risky way to enter a trade, but it is most surely one of the easiest. What next? The 1739.25 Hidden Pivot target still looks like a winner -- good enough for me to suggest reversing the short position and bottom-fishing there with a stop-loss as tight as 2-3 ticks.

The futures appear bound for the 1780.25 rally target shown, so your trading bias should be bullish for now. Night owls can zoom down to the three-minute chart to find camouflage opportunities, one of which is manifest at the moment in the form of a 1764.00 'external' peak recorded at 6:12 p.m. EST. Although there is implied upside potential of 17 points over the near term, price action on Wednesday was probably too turgid to fuel any aggressive moves by DaBoyz overnight. Under the circumstances, your best bet may be to try to rack up five or six points of profit overnight so that you're cushioned against any moderate craziness that occurs at the opening bell before liftoff

Bears struggled for yardage on Friday without making any first downs.  Although the intraday low at 1747.00 had obliterated a midpoint support, there was no follow-through to the downside target. Indeed, the futures were bounding higher by day's end, bidding fair to generate a strong bullish impulse leg on the 120-minute chart (see inset).  They were just 6.00 points from achieving this early Monday morning, and although we should wait until it happens before turning bullish, bears should dive for cover if and when it does.

We could be witnessing the death rattle of the biggest bull market of them all.  Bulls kicked and screamed their way through yesterday's session, violently resisting the pull of a minor Hidden Pivot target I'd provided. For those who got short ahead of these conniptions, the swings were too wild to abide.  My gut feeling nonetheless is that a major top is in, and we will therefore continue to establish short positions whenever the short-term odds are in our favor. One of these days, we'll get aboard just ahead of a 30-point downdraft, and we will be in the catbird's seat. For the moment, however, I see no great edge in being long or short. Camo traders should look for opportunities in either direction on charts of 5-minute degree or less.  To that end, an 'external' peak to be found at 1758.75 (3:40 p.m.) is worth a look.

My gut feeling is that the 1767.00 rally target we originally advertised here several weeks ago will turn out to have been a great place to get short. No subscribers have reported doing so in the way I advised, which would have entailed reversing a long position held from 1759.00 or lower. (We had identified the 1767.00 target when ES was trading nearly 40 points lower, so there were plenty of opportunities to surf the bull's final big wave.)  The intention of this strategy was to cushion the pain of riding a last-gasp thrust above the target. As it happened, a big cushion would have been needed, since the actual high so far has been 1773.25. Be that as it may, I just conversed in the chat room with a  subscriber who shorted this vehicle moments ago, in the early evening, using a 'camo' pattern on the 3-minute chart (see inset). The theoretical entry risk of 3.00 points per contract was more than we might typically abide when trading this vehicle with camouflage, but I am going to establish a tracking position nonetheless since it will allow me to follow-through on my very strong feeling that we have indeed caught a major top. Accordingly, based on price action that is occurring as I write these words, I'll track two short contracts with a cost basis of 1760.75 that is well off the recent high.  This implies four contracts shorted initially from 1757.25 (the green line shown), with two of them covered very quickly and for a small profit, as is our practice, at the 1753.75 midpoint pivot (red line).  For now, a stop-loss is advised at 1761.25 for the two contracts that remain, o-c-o (one-cancels-other) with an order to cover a single contract at 1746.50. If successful, we'll have one

The futures are just inches from a 1767.00 target that has kept us bullish from lower levels. As noted here earlier, if you've caught a ride from 1759.00 or lower, reverse the position (an assumed four contracts) and go short at 1765.75, stop 1769.25. 'Camouflage'-equipped traders can try this one too, keeping in mind that this particular vehicle has been devilish about giving us the kind of easy-entry abc patterns we thrive on, even at turning points that we've called correctly within a tick or two.  That's why I am recommending getting short via a straight offer, albeit only to those who have done the 'heavy lifting' required to 'draft' a trend that's gotten trickier with each new upthrust.  _______ UPDATE (October 29, 12:01 a.m. EDT):  We'll need to respect a new pattern with a target at 1782.50 that has taken shape. Although it is of lesser degree than the one we've been using at 1767.00, it is not unusual for such patterns to extend a move beyond the marquee number. Accordingly, I'll suggest lower the stop-loss given above by 1.00 point, to 1768.25. If it gets crushed, I'll be looking to try again at 1782.50. Camouflage will be the preferred method to get short, but I'll also sanction a single-contract short from 1782.00, stop 1783.75 for those inclined to do it the easy way. _______ UPDATE (9:51 p.m. EDT): It's always dicey shorting a target that has been hit in the final moments of a session. What happens next is a coin-toss at best, but my hunch is that Fed-driven hysteria will put the 1782.50 target in play early Wednesday.  If you're short already on the terms I'd advised, you have a healthy profit to cushion the risk. But you'll need to monitor the action overnight in any case,