Gone Fishin’…

Who needs sophisticated analysis when the broad averages rise or go sideways 95% of the time, and when they never fall for more than three consecutive days? The chart assumes the E-Mini S&Ps will continue their ascent next week, possibly stopping for a short breather when they hit 7694.25, the ‘D’ target of the conventional pattern shown. The coordinates are probably too obvious to produce a precise top at that price, a Hidden Pivot, but I would still encourage you to try shorting there provided you know how to set up a ‘camo’ trigger to minimize entry risk.  The goal is to make money even if the futures keep rallying, although that might entail being short only for a fraction of an hour. If we continue to short this gas-bag routinely at minor rally targets, one of these days we might actually find ourselves onboard for The Big One — and what great fun that will be!

If you got long at or near the green line as I advised here last week, your theoretical, unrealized profit on the standard four contracts would be around $71,000 — more than enough to pay for your subscription and a luxurious week in your favorite destination. Typically, I advise taking off half the position at the midpoint Hidden Pivot, shown here as a red line at 4636.80. At that point, you would have a realized gain of slightly more than $50,000; plus, two contracts left, each showing an unrealized gain of about $25,000, for swing at the fences. The 5144.00 rally target we’ve been using for months will remain valid unless the pattern’s point ‘c’ low is violated first. But, yes, you’re right: Who cares, as long as we can continue to exploit this tired pattern for all it’s worth.

Rates pulled back so sharply from menacing heights last week that one suspects Trump’s “team” was working its magic from the shadows. The president may not be able to control interest rates, but there is little doubt he can jostle them around for a little while when things start to get ugly.  The week finished with a small bounce from slightly beneath a correction target at 4.43%. Although it’s hard to tell whether this will prove to be the beginning of another scary run-up, a relapse exceeding Friday’s low would portend more slippage to as low as 4.33%.