Chicagostock Trading

Chicagostock Trading

SP500 January 2018 Mirrors January 2016


The SP500 started this year, zooming through last year's high and charging up to 2800.  This 2800 level is the 6 month volatility window in which 5 daily closes above established a bullish 6 month bias, forcing buyers to buy the breakout. The bias was established on January 24th, when the market completed its Cup/Handle target created on January 17th, after recovering its prior high of 280850 based off the January 16th low of 276925.  The market expanded this Cup/Handle up to 2846, seeing 2 days of consolidation, before expanding higher on Friday January 26th.  The breakout over the prior ATH of 2855 lured in new buyers, in which were caught when the market fell back under fell back under the January 24th low of 282550.  Over the last 2 days, buyers have fought to defend this level, seeing the market fall back to its Cup/Handle breakout of 2810 in which buyers defended, however were unable to overcome 2840.  Today the cash market opened lower, leaving longs trapped above and forcing sellers to chase lower, giving way to fall back under 2810 and target sell stops below the January 16th low of 276925 that began the move up.  By falling under 2800, buyers who bought the breakout above are now on the hook as the market falls back to test its 6 month pivot of 2751.  Buyers will be forced to defend this level, to prevent further damage, however as the Midcaps are showing, a move below the 6 month reversal window of 2717 and 5 daily closes below, will reverse the 6 month bullish bias into a reversal bias, giving way to expand the range of 211 (2667-2878), down toward 2456, which retraces the market back to test its breakout from September.  Rallies back to 2800-2810 now offers new resistance as supply is caught above, for buyers to overcome and sellers to defend.  Buyers will need to squeeze shorts through the February high of 2837 in order to get another shot at the high.  Failure to overcome 2800-2810, leaves longs vulnerable to see a shakeout under the 6 month volatility window of 2717.

Continue reading
599 Hits

Here Comes Santa Claus

Santa Claus came a week early to Wall Street with the SP500 breaking through 2665 on Friday.  As seen in the above chart, since the September low of 2485, the market expanded its rally into the November high of 2594 by 100% as it ran into 2665 earlier this month.  There was an initial break off the level that caused the market to fall into 2605 which was fueled by "fake news".  The market recovered off this low to make another run at 2665, before pulling into test 2620 as the November 29th low prior to seeing the break down to 2605.  This level held, trapping shorts below as buyers marched back to press against 2665.  The breakout seen this past Friday through 2665 has the market testing its 127.2% fib at 2694, with the 161.8% extension seen at 2732. Last week's 265175 low is now key for any downside shakeout/reversal.


Continue reading
472 Hits

SP500's Trouble with 2665 and Thursday's Vol Windows Defined

On Thursday, the day after the FOMC statement, we review the intraday action in regards to Chicagostock's Volatility windows and pivots.  The highlighted blue box, is the cash market open, NYSE 930 AM.  After the open, the cash market had trouble overcoming the intraday pivots, seeing the range act as resistance.  This led the market to fall into the lower Vol window which was met with a defensive bounce.  The defensive bounce gave way for a retest of the open, giving sellers an area to defend and buyers major resistance to overcome.  For buyers that picked up the initial test of the lower Vol window, this provided a bounce to take some profits into.  Second or third attempt at the lower Vol window, increases the odds of seeing the level failing. After failing to overcome the opening range, the market drifted back toward the lower Vol window which was taken out. In order to establish a bearish intraday bias, a 5 minute hold below the lower Vol window needs to be seen.  Sometimes the market can establish a bias, and bounce back to the open to again force sellers to defend their intraday trend.  In this case, the second test of the lower Vol window saw the level taken out, establishing a bearish intraday bias.  Since there was already an early bounce off the lower Vol window, there was not another one and sellers expanded the market lower, forcing longs to liquidate into the close. 


Continue reading
324 Hits

Is This the Top?

Last week, we highlighted the inverted head/shoulder technical pattern that was created after the market made new lows for the month in November and caught new shorts on the hook.  This inverted head/shoulder pattern, gave room to expand the market above the neckline of 258950 up to 262350.  The target was met on November 28th, with the market hitting a high of 2627.  



Continue reading
601 Hits

The Turkey Squeeze - T/A Galore: 2 Inverted Head/Shoulders and a Cup/Handle


 Last week, the market took out the early November low of 256225, falling into 255550, before quickly bouncing back to 257150.  This break of the monthly low turned into a failed breakdown and a head fake as the market retested 2562 into the end of day, creating a right shoulder for an inverted head/shoulder pattern.  Shorts below 2562 were left trapped, giving opportunity to expand the range up to 257150.  


Continue reading
504 Hits

Cash Market Games

Sometimes most of the move is done in the overnight (Globex) session, and by the time the cash market opens and everyone is selling the weakness, the cash market holds to prevent these traders from getting paid. Interesting? Weird? This is what I call CASH MARKET GAMES.  Not only does a lower open lure in shorts, but when it pushes back to close on the highs, it sucks in new longs that need to get paid in the following session. Should the market open lower in the following session, those new buyers are on the hook and short sellers have to come back chasing lower. 

Continue reading
595 Hits

The Bear Trap into Yellen's Short Squeeze


On Thursday of last week, the market sold down to a low of 240525, which successfully tested and held the June low.  Friday saw the market overcome the 3D pivot range resistance to reverse the negative momentum. This reversal allowed Monday and Tuesday's 3D pivots to turn into support.  Both days saw the market chop sideways into awaiting for Janet Yellen on Wednesday.  This in turn, creating a cup/handle pattern, with room to expand into 2449 on a break through 2427.  

Continue reading
795 Hits

SP500-Tracking the Recent Correction, What Next?

Anyone old enough to remember the euphoric action on May 2, 2012 when Bin-Laden captured? $ES_F $SPY $SPX

— Chicagostock (@Chicagostock) March 2, 2017



Continue reading
1426 Hits

Will President Trump Devalue the US Dollar?

Before Mr. Ben Bernanke became Fed chairman, he made a speech before the national Economists Club in Washington, DC. on November 21, 2002, titled “Deflation: Making Sure "It" Doesn't Happen Here.” In these remarks, there were 5 major points Mr. Bernanke pointed out as tools the Fed could use to fight deflation:

Continue reading
2424 Hits

SP500's Consolidation


Continue reading
724 Hits

2016 Top 5 Trends

In no particular order, here were the top 5 major market changing trends of 2016 identified by Chicagostock:

The stock market started 2016 weak, however recovered the highs of the year by summer, making a U turn. Those that were caught short, bearish, and wrong, were now forced to reverse position, thus creating the cup/handle formation, giving way to expand the U turn up to 20k.
Continue reading
1234 Hits

SP500's ride from 1800 to 2040 with Chicagostock




Continue reading
2281 Hits

The Great Reset


In December’s article “The Yellen that Stole Christmas”, the point was to show how buyers in the SP500 were caught above 2040, and needed a Yellen rescue.  The market attempted to breakout to start December, however the rug was pulled from underneath as Yellen reiterated a rate hike later in the month.  After bluffing the market for 2 years on this rate cut, the call fell on many deaf ears.  So it was. Buyers were left caught at higher prices, betting on a “Santa Claus Rally” only to be hoping for Yellen to save Christmas.  For the first time in 6 years and exactly 3 years from December 2012’s FOMC that placed a 6.5% target on NFP for a decision on Fed Funds rate, the FOMC reset the market and hiked the Fed Funds rate by a quarter point.  Bulls did not get what they were looking for and saw the market fall back to retest 1982 support.  The level barely held on December 18th, as the market rallied back for Christmas holiday and the “Santa Claus Rally” was actually a gift from Yellen for stuck longs above 2040 to “breakeven”, or as we like to call it “get out of jail free card”.  

Continue reading
2479 Hits

The Yellen that Stole Christmas


When the FOMC decided to place a 6.5% target on NFP rates to justify raising the federal funds rate, the SP500 was trading 1427, gold 1718, US dollar 7985, and 30 year bonds at 148.  

“… the Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent and currently anticipates that this exceptionally low range for the federal funds rate will be appropriate at least as long as the unemployment rate remains above 6-1/2 percent…” (FOMC 12/12/12 source).

Just days after this release, we highlighted the weakness in gold: Whats With Gold? FOMC Spooks Market. Double Top Eyes 1250.

Continue reading
2301 Hits

Pre-FOMC Market Update



Futures, foreign currency and options trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones financial security or lifestyle. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results. Video content hosted by third party.

Continue reading
1888 Hits

CST Pro May Trial

Excerpt from CST Pro subscription email sent on 04/27/15 for trade day 04/28/15.  As highlighted in the report, 209050 was a long trade with specific stop and target levels. Bottom left of image is excerpt from our chat, highlighting Chicagostock's intraday analysis, followed by a chart of the intraday Emini SP500 on 04/28/15.  

CST Pro Subscription- 2 Week Trial 

  • Daily Emini SP500 Futures Analysis
  • Daily pivots & vol windows (ES/CL/GC)
  • Volatility Windows PDF Guide
  • Swing trade recommendations
  • Live trading chatroom
  • Live charts
  • Live day trading signals 



For the month of May of 2015, we are offering a special 2 week trial period to CST Pro for only $99! This will gain you access to the daily letter, pivots, live day/swing trade signals, trading room, and screen share.  

This is an open offer to allow you the opportunity to try our group and see what we are about. Only serious traders apply. We have room for a maximum of 10 new traders. If you beleive you can find value in joining our group and services, please feel free to apply. See you soon and best of luck trading!

 Please email This email address is being protected from spambots. You need JavaScript enabled to view it. for future trials and or any questions.



By accepting trial membership you agree to terms and conditions. Chicagostock Trading uses proprietary and copyright protected material.


Continue reading
1465 Hits

CST Emini Report vs CST Pro


CST Emini SP500 Report:

Example and excerpt of ES analysis sent on 04/22/15 for trade day 04/23/15 through CST EMINI SP500 Report:


Thursday 04/23/15 Emini SP500 Chart:


Low: 2087.50

High: 2114.50

Continue reading
1487 Hits

SP500 Market Update - Video



Futures, foreign currency and options trading contains substantial risk and is not for every investor. An investor could potentially lose all or more than the initial investment. Risk capital is money that can be lost without jeopardizing ones financial security or lifestyle. Only risk capital should be used for trading and only those with sufficient risk capital should consider trading. Past performance is not necessarily indicative of future results. Video content hosted by third party.

Continue reading
1454 Hits

SP500 Will History Repeat Itself?


(click chart to enlarge)

The SP500 has come a long way.  Starting the year at 1838 to put in lows of 1732 and make highs of 2079 as of recent.  The 2nd half of the year has seen volatility expand.  July began just as January did, a very tight trading range followed by a small pullback before rallying into new highs. Difference in the 2nd half was the new highs was rejected in September, with the market falling apart in October to take out the August low and fall into 1813, testing major support based off the April lows.  The break of the multi year bullish channel, was followed by one of the most massive and violent short squeezes ever.  Just as early October the market put up a strong fight with violent short squeezes before finally letting go down to 1813, the move back to 1970 was just as violent.  The reversal from 1970 to 1813 and back to 1970, was a major short squeeze and V shaped bottom.  After this short squeeze, it was time for the market to take a breather, consolidate, attempt to build a base and support for new longs to join for a new leg up.  What happened was a different story.  Rather then allowing buyers this opportunity… Halloween 2014, just as the SP was pressing against major resistance against the September highs, BOJ came out with an expansion to their QE program, lifting the lid above the September highs and seeing the SP trade through 2k for the first time ever.  Rather then allowing the cool off period at 1970, the BOJ squeeze forced buyers to chase the market above 2000.  November made early lows at 1995, before grinding up to into highs of 2072 going into the Thanksgiving holiday. During this period, the cash market worked very hard to open and settle the market at its prior close, walking a very tight line.  Following the holiday, the market saw a gap open lower down to 2048, only to becoome a bear trap as the following day the market squeezed back above 2060 to save cash buyers and grind out new highs.  Draghi came out on the 4th of December, touting a ECB QE program in January which led the market to scetch out another new high at 207725.  All of these highs were made by a few points and saw profit taking into them. The following day was NFP and the SP managed once again to squeeze 2077, print highs of 2079, and fail to hold above. This led into a break out failure, seeing the market fall back to retest the December 1st low of 2048. 



The SP’s move below the Dec 1st low of 2048, has confirmed a short term failed breakout above 2077 and a double top.  The move now is testing major support down to 2015 based off the November low of 1995 that led to the chase higher.  The current break has caught longs off guard and sellers are looking for blood to press the market lower.  Failure to hold the November low of 1995, confirms a failed breakout above 2000 as the market retraces back below the BOJ QE breakout and leaves buyers who chased above holding the bag.  First major downside support is seen down to 1977 to retest the breakout point from October’s V bottom 1970-1813-1970.  The question that will arise and will be seen is will there be buyers left to buy the market at this level, after the BOJ forced them to chase above 2000?  This will leave for a thinner bid on the downside and more longs who are caught giving way for volatility to expand.  A failure to hold 1970 gives room down to retest the 1813 low with major support down to 1840.  The objective for the sell side is to take out these lows and test the 2014 low of 1732 with support coming in at 1750.  To reverse current momentum, buyers need to recover above 2050 to retest resistance at 2068 based off the highs of 2079.  The objective for the sell side is to settle the market below the December 1st lows to establish a weekly sell signal and bearish engulfment.  


Continue reading
2095 Hits

How Does the Ali Baba Top Differ from 2011's Bin Laden Top?



The recent reversal in the SP500 has reminded us of a similar time the charts and reversal felt and looked the same.  The above chart is from 2011.  As seen the market made an early high of 1335 in February, correcting down to 1241 before rallying back to new highs.  New highs were made on what was called the "Bin Laden" high. On the news of his capture, the SP printed the highs for the year at 1373.50 and turned lower to retest the previous 1335 lows made in February.  This retest was followed by a "U" shaped reversal that recovered back to where the market failed at 1348 on the 1st of June.  This reversal failed to stabilize and push through the highs, leading into what developed the right shoulder for the 2011 head/shoulder top and crash down to 1080 that was fueled by the debt downgrade.  QE 2 ended in July 2011, just as QE 3 is expected to end 10/29/14. 


Continue reading
2242 Hits