ESZ11

An 1152.25 downside target remains valid, notwithstanding a squeeze on shorts Monday night that has added the equivalent of about 50 Dow points to this gas-bag.  An immediate rally target at 1199.50 has little to offer night owls, but a pop today above the 1208.50 peak highlighted in the chart would be reason to pay heed. ______ UPDATE (1o:45 a.m. EST):  The futures topped overnight at 1199.00 before dropping back 15 points to a so far low of 1184.00.

After opening on a small gap down Sunday night, the futures have flatlined for nearly six hours. This tedious dirge has left an 1194.50 downside target given here on Friday undisturbed, although I'd suggest using it to bottom-fish only if entry is via camouflage. (Check Friday's post in the archive for further details.) A bigger-picture target lies at 1152.25, the midpoint support of the pattern shown. Click here if you’d like to learn how to do these trading tricks yourself.

Try bottom-fishing at 1194.50, the clear-as-day Hidden Pivot target of the pattern shown. You could use a stop-loss as tight as three ticks, but camouflage is the preferred tactic for two reasons: 1) the pattern is sufficiently clear to attract the attention of the riff-raff; and 2) the support lies just 2.00 points above a key structural low recorded on October 20. Incidentally, although a breach of the pivot and the low would have bearish implications going forward, you could still take the long side following an apparent breakdown, since it could produce a nice whipsaw to the upside.  Click here if you’d like to learn how to do these trading tricks yourself.

Traders who followed my advice would have gotten long at exactly 10:11 p.m. EST Wednesday night, since the futures bottomed at 1225.75, a single tick from the entry point I'd advised. (It would have been a tick or two higher than the original number, since we were using a rising trendline to position our bid. It was also noted in the chat room that a conventional ABCD pattern caught the 1225.75 low to the exact tick.)  Assuming four contracts were acquired, cash out half of them now with the futures trading at 1232.75.  That would give the remaining two contracts a profit-adjusted cost basis of 1219.00.  Set a 1230.00 stop-loss, but plan on exiting one of the two contracts at 1234.50 if it's reached.  We'll swing for the fence on that last contract, letting it run with no stop-loss. _______ UPDATE (1:56 a.m. EST):  We exited the third contract at around 10:33 p.m. That leaves us with a single contract (or 25% of the original position if you did more than four contracts) and a paper-profit-adjusted cost basis of 1210.25.  To eliminate the open-ended risk of loss, I'll recommend using an impulsive stop-loss, meaning we'll exit the last contract if a bearish impulse leg is generated on the hourly chart. At the moment, with the futures trading 1236.25, it would take an uncorrected plunge to 1224.25 on the hourly chart to stop us out.  That would breach two prior lows -- an internal as 1225.75 recorded tonight at around 8:30; and a second  at 1224.50 recorded on November 10. _______ UPDATE (10:59 a.m. EST): We exited on the stop at 1224.00 for a theoretical gain of slightly less than $700 per contract.  Because the downdraft exceeded the 1225.75 Hidden Pivot midpoint of a pattern begun Wednesday from 1257.75, the rally

Although we usually use Hidden Pivots to trade prospective reversal points, I'll suggest trying something new to break the deathly tedium of this corrective dirge, which is about to enter its fourth week. The pennant formation in the chart shown has picked up no fewer than five price points on the daily chart, and it would pick up a sixth if 1225.50 were reached to the downside today. You can bottom-fish this number with a stop-loss as tight as 1.00 pont.  FYI, the slope of the rising line would put our 'buy' point at around 1227.00 if the low were to occur on Thursday. A 1267.50 target should be used to get short if the futures instead rally today.

A bearish target posted in the chat room yesterday morning caught the intraday low by two ticks, implying that the rise and fall of the broad averages is still more or less predictable despite hysterical volatility. A key clue -- useful yesterday in bullion as well -- came in the form of small rallies that had failed to exceed minor peaks impulsively.  Today's all-but-certain flatulence would encounter Hidden Pivot resistance at 1260.50 if stocks move higher, or at 1242.25 if lower. _______ UPDATE (2:28 p.m. EST):  The expected flatulence, which took the familiar form of a do-si-do of gratuitous ups and downs, has topped so far at 1260.25, a single tick from the bullish target noted above.  If you got short, cover half now and manage the rest catch-as-catch-can.

A 1305.25 rally target drum-rolled here earlier is still a logical minimum objective for the near term.  Trend-trading is limited to the very lesser charts, and so I'll suggest that camouflageurs take their cues from such look-to-the-left peaks as are evident in the accompanying chart.  _______ UPDATE:  The futures made their intraday low at 1243.50, two ticks from a bearish target at 1243.00 posted in the chat room shortly before noon EST, when the December contract was trading around  1255.  As I noted at the time, the weakness should be viewed as an installment on some bearish, bigger-picture targets below 1200.

Yesterday's pooch-screwing was centered mainly on a 1237.50 midpoint resistance that's associated with a 'D' target at 1250.25.  Although I won't pretend to care which way things go -- it is a Friday, after all -- I'll mention that the look-to-the-left peak at 1246.50 shown in the chart could provide an excellent 'camo' opportunity to get long if there's a rally that stalls and pulls back from somewhere between it and the more obvious high at 1249.25.   The November 16-17 Webinar will be held much earlier in the day in order to accommodate students from Europe who would otherwise be in session in the middle of the night. Both segments of the two-day class will begin at 5 p.m. London time. Click here if you’d like further details, along with a $50 discount.

An 1194.50 target disseminated yesterday via an e-mail bulletin and a tout update remains my minimum downside objective at the moment.  It would be refreshing to think this is the beginning of the collapse that will usher in a new dawn for the world's financial markets, but we'll just have to wait and see how sellers behave once they've succeeded in driving this vehicle to its immediate destiny at 1194.50.  If the support is easily shattered, expect more carnage to follow. Even more immediate is the 1209.75 target of the minor pattern shown. Night owls can use this number to get short off the 5-minute chart using a pattern as subtle as the one shown. However, if you do any bottom-fishing at the supports identified above, I'd suggest using camouflage, since the selloff has quite a lot of enthusiasm driving it. Incidentally, we caught a small uptrend yesterday against the trend, since that is the way the futures were moving when we had them underneath the magnifying glass of Wednesday's tutorial session. The trade was captured on tape in real time and is accessible via a recording that will be posted shortly on the home page. _______ UPDATE (8:43 a..m. EST): Another pointless reversal, amounting to more pointless volatility in the relentless, historically unprecedented effusion of pointlessness that has come to rule the global financial system. Signs point most immediately to 1258.50, but there is no real strength here, only pointlessness, since three attempts over three hours have yet to push this whirligig above yesterday's 1246.50 'external' peak. There's also a midpoint resistance at 1246.25 -- representing double trouble -- so DaBoyz evidently are waiting for opening-minutes, headless-chicken hysteria to accomplish what mere short-covering apparently could not.   One more note: The November 16-17 Webinar will be held much earlier in