Negative earnings reports from a few high-profile companies yesterday, worked to push S&P e-mini (ES) below Cycle Day 1 Low down to average violation zone between 2012 – 2014…Actual LOD = 2013.25. Having confidence that a secure low was in place, buyers proceeded to auction prices higher throughout the session as high as 2036 handle before pulling back and settling near Volume Trend Midpoint (VTMP).
Today is Cycle Day 3 (CD3)…Odds of 3D Rally > 10 = 82%; Odds of 3D Rally > 20 = 53%; Average Range on CD3 = 17.75; Max Average Range = 21.50; Possible High = 2063 based upon penetration of CD2 (globex high); Possible Low = 2003 based upon average violation of CD2 low.
***Note: The odds highlighted are NOT predictions or trade recommendations, rather a guide based upon historical observed occurrences.
Scenario 1: IF price can clear and convert PDH (2037.00), THEN there is a 60% chance of expanding upwards to 2045.50 Cycle Price Target. Any momentum acceleration above this level targets 2052.00 (VT Hist 2)…2056.50 (D-Level)…2059.25 – 2061.50 (Money-Box).
Scenario 2: Failure to convert PDH (2037.00) and/or violation of 2034.00 CPZ targets CD1 Low 2025.50. Violation and conversion of CD1 Low targets a retest of PDL (2013.25) and TargetMaster Range Breakdown Level 2012.75. Deep expansion Xtreme measures 2002 handle.
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 on 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!
I am willing to accept loss. Losing is an integral part of the process. I know and accept that individual losses and losing periods will happen. They are endemic to trading. I do not like loss. I do not expect loss. I simply accept loss as a cost of doing business.