QQQQ

I've tired of waiting for this cinder block to reach our rally target so that we can get short.  Instead, let's try to leverage the downside by legging into a risk-free butterfly spread.  This is never easy, but we won't chase opportunities if they don't come to us.  For starters, and pursuant to building an October put 'fly using the 50/46/42 strikes, let's bid 0.53 for eight October 46 puts, day order.  Don't worry if the order goes unfilled, since we're going to keep trying. ______ UPDATE (9:46 a.m. EDT):  With stocks in their increasingly familiar collapse mode today, the October 46 puts opened up on a gap and never traded for less than 1.02.  As implied above, as the Mother of All Bear Markets proceeds, there will always be other opportunities.  For now, though, cancel the order.

The choppy action of the last two days has created "dueling" impulse legs, a usually reliable sign of more tedium to come. In this case, however, we should probably infer no more than that confusion and uncertainty reign, but that this could end with a vengeance if some piece of news unsettles traders as it inevitably will. Use a 55.88 rally target -- slightly higher than the one given here earlier -- to buy four September 55 puts. As before, if the puts trade for 0.25 less than what you paid for them, exit the trade.  I will further suggest that if the position is showing a profit of at least 0.30 per option, close out half of the puts.

We'll break a rule to try to short this rally, but you'll need to rigorously apply the stop-loss I'm going to suggest if you do the trade.  The 55.77 rally target shown in the chart is analogous to the one at 1227.25 that I've flagged in the E-Mini S&P.  As you will also notice, however, any upthrust that hits that hits 55.77 is going to surpass a couple of prior peaks on the hourly chart, refreshing its impulsive bullishness.  Be that as it may, I am going to suggest that you buy four September 55 puts if and when the Cubes get within 0.03-0.05 points of the target. You can do bigger size if you are confident you've got things under control and that know what you are doing, but blow out the position if the puts trade for 0.25 less than what you paid for them.  This is NOT one of those trades where I can more or less guarantee that even beginners will make easy money, since, as I've implied above, the futures could easily move higher after pulling back from the target.  I will therefore also suggest that if the position is showing a profit of at least 0.30 per option, that you close out half of the puts.

Check out the stunning power of the impulse leg on the daily chart!  The move from June 23's one-off low at 54.06 has eclipsed no fewer than one "internal'" peak and  five "externals" in a sensational run-up that streaked for nine days without pausing for breath. The rally's strength was foretold by an initial, minor rally from the mid-June lows that easily surpassed three external peaks on the lesser charts. At the time, I commented that bears would soon be in for a rough time, and that has proven to be the case.  Friday's over-the-top finishing stroke will set the stage for a continuation of the rally to the 61.73 Hidden Pivot shown in the chart. It may take a week or two for the Cubes to consolidate for the move, but rather than speculate on its timing, we'll simply monitor the lesser charts for the first sign of a launch, jumping aboard if and when the opportunity suits our risk-averse style.  (You can do these calculations yourself, quickly learning how to out-forecast even seasoned gurus. Click here for further details and a $50 discount to the upcoming webinar.)

We briefly held July 57 calls but ditched them for a tiny loss when the Cubes slightly exceeded the downside Hidden Pivot we'd used to time our entry. The move through the support has been slight so far, but the fact that it was exceeded at all hints of still lower prices to come.  Moreover, the decline created the first bearish impulse leg on the daily chart since March. This means we should look to short this vehicle on rallies, so stay tuned for detailed advice if and when an attractive opportunity surfaces.     Incidentally, if you don’t subscribe to Rick’s Picks but would like to know more about the proprietary camouflage trading technique that we use to keep entry risk to a bare minimum, click here for information about the Hidden Pivot Webinar in late June.  You could also take a free week’s trial subscription that will give you access not only to explicit, easy-to-follow trading recommendations each day, but to a 24/7 chat room that draws combat-hardened traders from around the world

A 56.02 downside target remains valid, so continue to bid for four June 56 calls if our number is closely approached. A 55.87 stop-loss is appropriate. _______ UPDATE (June 6): Cancel the trade, since a new downside target at 55.54 looks more promising. I'll recommend buying four July 57 calls if and when that number is closely approached.  The new stop-loss should be at 55.38. Note: The turn could also come from 59.64, a secondary Hidden Pivot.  _______ FURTHER UPDATE (10:08 a.m. EDT):  Off a so-far low this morning of 55.45, we bought four calls @ 0.57.  Maintain the stop-loss as given, since DaScumballs who sold us the calls have tipped us to their possible further weakness by opening them on a rapacious high. _______ FINAL UPDATE: We ditched the calls for a small loss when this little brick fell back to earth after rallying 30 cents from our entry point. The breach of the Hidden Pivot support, slight though it was, portends more weakness ahead.  Bulls could reclaim the advantage, however, with a push on Thursday exceeding 55.77.

No change.  Because we’re short the E-Mini S&P from prices well above these levels, I’m offering a gambit in the QQQs that will allow traders to leverage the dead-cat bounce that looks likely to occur shortly.  The downside target is 56.02, a Hidden Pivot, and so I’ll suggest buying four June 56 calls if and when it is closely approached (i.e., within about 6-10 cents).  Stop yourself out of the position if the QQQs trade 55.87 or lower.  The calls look like they should be trading for around $1.10 or so if the target is reached, but the price could easily vary by 10 cents or more.

Since we're short the E-Mini S&P from prices well above these levels, I'm offering a gambit in the QQQs that will allow traders to leverage the dead-cat bounce that looks likely to occur today or tomorrow. The downside target is 56.02, a Hidden Pivot, and so I'll suggest buying four June 56 calls if and when it is closely approached (i.e., within about 6-10 cents).  Stop yourself out of the position if the QQQs trade 55.87 or lower.  The calls look like they should be trading for around $1.10 or so if the target is reached, but the price could easily vary by 10 cents or more.

If you're short the E-Mini S&P from 1358.25, or have no position at all, try bottom-fishing this vehicle near 57.17, the Hidden Pivot midpoint of the pattern shown. This will work as a hedge against the short or, simply, as a cheap bet on a bounce from our number.  The June 57 calls would be a great buy for around 1.03, but be prepared to pay more if they're trading higher with the Cubes within pennies  of our target.  I'll suggest buying four calls, but stop yourself out of them if the underlying trades 56.98 or lower.  On a rally, be ready to cash out half of the position for a partial profit at 57.48. If you would like to know more about the Hidden Pivot Method that we use  to forecast and trade swing highs and lows,  click here and get a free one-week subscription to Rick's Picks. _______ UPDATE (10:52 p.m. EDT):   The trade was a non-starter, since the Cubes began the day a penny above our 56.99 stop-loss and quickly dropped below it.