Price notched a new contract high for the S&P e-mini (ES) in Globex trade albeit marginally. Yesterday’s Daily Trade Strategy’s Scenario 1 played out perfectly as price reached upper price target 1986.00 to the tick. Here’s excerpt: “IF price can convert Prior Day High 1978.25, THEN there is a 55% chance of achieving 1981.00 – 1982.25 STATX Zone, followed by 1986 handle prior contract high. Initial pullback support is 1973 – 74 PDVTMP zone. Price will need to hold above this level and convert PDH to increase probabilities of achieving upper price targets.”
The current “power cycle” produced a shallow low on CD1 (1973) as anticipated, with high odds of notching new highs. Today is Cycle Day 2 (CD2) with projected Cycle Target 1989 based upon historical average cycle rally.
Average Range on CD2 = 14.54; Max Range on CD2 = 22.25; Odds of Rally > 10 = 83%; Odds of Rally > 20 = 45%; Projected Cycle Targets: Min = 1990.25…Max = 1995.50
Scenario 1: IF price can convert prior day high (1986.00), THEN there is a 60% chance of price reaching 1988.75 – 1989.50 initial cycle targets. IF bullish momentum continues above initial target, THEN upside projects 1994.25 – 1995.50 maximum cycle targets.
Scenario 2: Price is currently above prior day high (1986)…Failure to hold above this level suggests a potential auction failure with increased odds of selling. Lower support levels to be mindful of are 1980 – 82 zone…1976 – 78 zone and 1972 – 75 3D Central Pivot Zone.
Trade Strategy: Our trade strategy has been focused on the long-side during this power-cycle and correctly so, as underlying market dynamics have been very bullish. We will continue to favor long-side cautiously as price tests contract highs. There is strong potential for a stop-run push higher then failure. Until there is a definitive structure shift in price dynamics, we must remain aligned with dominant force, which is currently the “Raging Bull”
Focus on the Trade Process…Not the Outcome…ALWAYS USE STOPS!
I am ready to trade. My patterns are verified. My homework is complete. My mind is clear. I have rehearsed everything. I am prepared strategically, emotionally, and financially each and every day.
PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS