Markets turned in yet another positive weekly performance to close at new highs…With all metrics solidly positive, the bears are finding it more difficult, painfully so, to continue shorting…but as bears…short they must.
Perhaps Mr. Market has unlocked the secret to Harry Houdini or Criss Angel’s “Levitation Trick” because from all angles this market has definitely defied gravity (no strings attached). That being said, who doesn’t like a good Magic Show!
Overnight trade is relative light and quiet trading within above a 4 handle range. The 10-Day Average Daily Range of 11.50 handles is well below historical norms, as well as Volatility Index.
Scenario 1: IF price can penetrate and convert PDH 1956.75, THEN upside price projections measure 1962.25 – 1965.50.
Scenario 2: Failure to convert PDH 1956.75, and violation of 1952 key marker, lower price initially targets 1948 – 50 zone, with lower zones measuring 1942.25 – 1945.25, with extremes down to 1940.75 – 1937.50.
Trade Strategy: We’ll continue to respect the strength of the bull, though becoming more concerned that a normal price correction has not developed in quite some time…Even though this has not happened, it does not necessarily increase probabilities that it will…But we remain on “high-alert” of it occurring. As such, our trade strategy will continue in disciplined fashion proper trade selection following our trading guidelines. As traders we must remain flexible looking for trade opportunities both long and short during consolidation periods and trade with primary trend direction.
Focus on the Process of Trading…Not the Outcome ALWAYS USE STOPS!
I take the long term view. I am willing to lose in the short term. I understand that losses are a necessary cost of doing business, like inventory to a merchant. Drawdowns are viewed as temporary. I realize that my wins and winning periods are part of the broad process. Each trade is but one in a string of trades. What is happening now is one piece of a much larger puzzle. Because of this I do not get overly euphoric or despondent.
PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS