Continued volatility made for large price swings the past few days with an overall downward directional bias, as professional traders continue to sell rallies to key resistance zones. Price in the overnight trade hit our projected target of 1970 we had outlined in yesterday’s Daily Trade Strategy 01.15.15.
Today begins a New Cycle (CD1)…Price has currently reached initial CD1 price target zone between 1970 – 1975. We will mark this zone as “Key Support” until violated…It is critical that no further selling develops below this zone, otherwise another round of long liquidation may unfold.
Odds of Decline > 10 = 70%; Odds of Decline > 20 = 41%; Average Range on CD1 = 18.75; Max Average Range = 21.75; Possible High = 2035 based upon penetration and conversion of PDH (2027.25); Possible Low = 1970 based upon violation of PDL (1984.75)
***Note: The odds highlighted are NOT predictions or trade recommendations, rather a guide based upon historical observed occurrences.
Today’s Hypotheses:
Scenario 1: Price must hold 1970 handle and get back above PDL (1984.75) for bullish case…IF price can clear and convert 1984.75, THEN there is a 55% chance of retracement rally up to 1995 handle…Above this level targets 2001 – 2006, then 2011 TargetMaster Breakout Level.
Scenario 2: Price has violated PDL (1984.75) in overnight trade and has tested projected low (1970)…Failure to clear and convert 1984.75, and subsequent violation of overnight low 1970 handle, projects further downside selling which targets 1964.75..1960.75 zone, with extreme projection down to 1950.50 TargetMaster Breakdown Level.
Trade Strategy: Our tactical trade strategy will simply remain unaltered…We’ll be flexible to trade both long and short side from Decision Pivot Levels. Continue to focus of Bull/Bear Stackers and Premium/Discounts. As always, remaining in alignment with dominant intra-day force increases probabilities of producing winning trades.
Stay Focused…Non-Biased…Disciplined ALWAYS USE STOPS!
Good Trading…David
Habitude Nine
I will identify my mistakes and learn from them. I am optimistic, realistic and honest. I will not make up stories about the good or bad things that occurred in the past or are happening now. I admit when something is not working. My optimism gives me faith and courage. I will not fall prey to blame and fear.