Trade Strategy 02.26.15

Range as measured by 5-day Average True Range now stands at 10.42, which means daily ranges continue to compress…VIX index is now back to 13.84 as complacency has reemerged…Daily volumes have been consistently below 20 day averages…Cumulative Delta’s have reversed to negative even as price notches new all-time highs. These are the observational facts underlying current price action…The bull is still alive collectively across market sectors, but does not seem to be to aggressive at current levels…This could set the stage for pullback in price so stay alert.

Today is Cycle Day 3 (CD3)…Odds of 3D Rally > 10 = 82%; Odds of Rally > 20 = 54%; Average Range on CD3 = 17.75; Max Average Range = 21.50; Possible High = 2127.50; Possible Low = 2099.75

***Note: The odds highlighted are NOT predictions or trade recommendations, rather a guide based upon historical observed occurrences.

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Today’s Hypotheses:

Scenario 1: If price can clear & convert PDH (2117.75), THEN there is a 55% chance of price extending to TargetMaster Breakout Level 2121.25…Above this level measures multiple expansion levels between 2125.00 – 2129.75.

Scenario 2: Initial resistance is marked at 2115 handle…Failure to convert this level keeps price contained in recent 2-day range. Key support is marked at 2106 – 2108 zone. Violation and conversion of this zone opens door to deeper downside pullback which measures 2103.50 – 2102.75 zone. Breakdown through this zone targets 2099.75 which was the breakout level. Deep extremes measure between 2098.50 – 2094.75.

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!

Good Trading…David

Habitude Twelve
I am disciplined. I behave in a way to reach my goals. I do what I intend to do. I have the intent to win through right actions. I will be patient for patterns to emerge and mature. I am decisive. I decide easily and act promptly. I act in the right way and right on time. When there is nothing to be done, I will wait.


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