E-Mini S&P

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,

Yesterday's schizoid price action blew past a minor Hidden Pivot target at 1748.00 noted here earlier so easily that we should presume the rally will soon reach a more important one at 1767.00 provided at the same time.  I'd advised a bullish trading bias till the lower resistance was reached, but you should stay bullish until the presumptive finishing stroke hits 1767.00.  If at that point you've been long from 1759.00 or lower, you can reverse the position and get short via a 1765.75 offer, stop 1769.25.  If you've held no position at all and would like to try shorting nevertheless, you should do so via camouflage, using an entry signal that comes from the one-minute chart or less.  I'd suggest looking for the turn when the rally hits 1765.75.

Two important Hidden Pivots await to challenge the gumption of Wall Street's mechanical bull.  The resistance points lie, respectively, at 1748.00 and 1767.00, and we'll be looking to get short in either place -- to make a small profit, even, if we're wrong and stocks simply ratchet past both. The lower number can be used as a minimum upside projection for the near-term, but with the caveat that the party -- in its 56th month now and as frivolously energetic as ever -- could end at any moment. If the higher target is in fact easily surpassed, we will once again have underestimated the foolishness that has driven stocks ever higher since 2009 and which would now flout abundant evidence that the Republic itself is crumbling. (Click here...or...here, if you need to be convinced.) Traders can use a stop-loss as wide as 2.25 points shorting 1748.00 if they are reversing a long position entered at 1739.00 or lower, but we'll play it by ear if there's a trade at 1767.00. The chat room will be the place to be if you're game to play.

Now that's more like it! We've been looking for a rally to get short, and yesterday's knee-jerk spasm promises even richer prices in the days ahead. In the chart that accompanies this tout, you'll see numerous ABC rally patterns, each with a unique target. The two we should focus on today are 1726.25 and 1733.25, and day traders can short either using the camouflage technique. If you're looking to do the trade quick and clean with a simple short offer, try a single contract at the higher number, stop 1734.25. I'm suggesting this because the precise impact at the p midpoint has validated the target itself. Although there's money to be made on the long side as well, it may be available only to night owls, since Thursday's opening bell could produce a gap-up rally to either of the targets given above. For detailed instructions on initiating a position short in the Diamonds, stay tuned to the chat room and my e-mail bulletins.

Bears were getting battered senseless when last week ended, so expect them to be buying with both fists to cover short positions when stocks get rolling on Monday. This will not preclude the possibility that DaBoyz will manipulate stocks lower Sunday night in order to shake out sellers still nervous about Washington's dithering.  However, the supposedly smart money will be betting in any case that a deal is inevitable and that the market will roar higher when it is announced. From a technical standpoint, trends both minor and major are in synch to drive stocks higher, presumably toward either of the two targets shown in the chart. Notice that the midpoint resistance of both patterns gave way easily, and  that each has since become a point of consolidation. This has shortened the odds that the lower of the two rally targets will be reached. Looking beyond this, my concern is that the political currents that have pushed stocks hither and thither in recent weeks will turn out to have been a red herring. Many investors are bound to assume that a temporary peace in Washington will clear the way for a stock market rampage to who-knows-how-high.  If so, this attitude would beautifully 'set the hook' to trap bulls at the top. My gut feeling is that Obamacare alone, effectively a huge new tax on the middle class, will suffice to turn an already moribund economy into a deeply recessionary one. If so, with stocks just a short distance from all-time highs, investors are manifestly unprepared for the gathering storm. More immediately, traders working the night shift should ignore the news from Washington and look to bottom-fish whatever sleazy shakeout occurs ahead of Monday's opening bell. If you use the camouflage technique to get long, watch on the 15-minute chart for

So now the rumored deal on the debt ceiling supposedly is in jeopardy. What will the criminal lunatics who short-squeezed the Dow for 323 undeserved points yesterday do next? The night shift has seen this vehicle down 11 points so far, but DaBoyz have since been able to engineer a 7-point pump-and-dump rally. Absent a deal on Capitol Hill Thursday night, there could be an avalanche of remorse at the opening bell. My hunch, however,  is that things will be more subdued, and that traders will be gambling that the weekend will produce 'progress' in Washington.  Under the circumstances, the futures are a scalp-trade right now at best, and you should therefore do your hunting on charts of 15-minute degree or less.  This yields a bearish picture at the moment (i.e., 6:59 p.m. EDT), but I'd be looking to get long nevertheless near the 1675.25 p midpoint pivot shown.  If it gives way easily, however, take it as a warning that the avalanche of remorse could indeed be on its way.

Traders who went bottom-fishing at the 1666.50 pivot flagged here yesterday would have been stopped out quickly for small change, assuming they applied the two-tick stop-loss I'd suggested. The triggering of the stop was warning of lower prices to come, as indeed they did.  Yet more selling appears likely, but the two Hidden Pivot targets shown -- respectively at 1639.50 and 1632.25 -- look ill-suited to contain the downtrend.  My hunch is that sellers will test the structural support of some key lows near 1620 that were recorded in late August/early September and which should have become 'magnetic' by now.