Trade Strategy 08.13.15


Investors this morning will be eyeing a slew of U.S. economic data, including retail sales, which are projected to show a healthy rebound after an unexpected decline in June. Strength in July’s report will likely center around motor vehicles, although other components are also predicted to have good showings. The data is the latest in a series of economic figures to suggest the future timing of a Fed interest rate hike…September?

Today’s Economic Calendar

8:30 Initial Jobless Claims
8:30 Retail Sales
8:30 Import/Export Prices
9:45 Bloomberg Consumer Comfort Index
10:00 Business Inventories
10:30 EIA Natural Gas Inventory
1:00 PM Results of $16B, 30-Year Note Auction
4:30 PM Money Supply
4:30 PM Fed Balance Sheet


Yesterday’s trade gave both sides, bulls and bears plenty of trade opportunity, as price gapped heavily down to come within 6 tics of our lowest extreme projection 2045.00..the actual LOD was within Margin of Error (MOE). Heavy volume capped the move down as rumors of PPT supporting price gave bulls added confidence, sparking a strong rally reaching 2082.75 Three Day Central Pivot outlined in prior DTS Report 08.12.15.

In overnight trade price has reached Average Cycle Rally Target 2093.00 to the tic. Today is Cycle Day 3 so having reached Cycle Target, it is NEUTRAL SPILL for today’s trade, meaning price could go either way. Main expectation is for some “back n fill” to absorb yesterday’s range.

Cycle Day 3 (CD3)…Odds of 3D Rally > 10 = 82%; Odds of 3D Rally > 20 = 54% (both achieved); Average Range = 17.75; Max Average Range = 21.50; Possible HOD = 2093.00; Possible LOD = 2071.50.

***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: September (U) Contract

*****The levels outlined below are more general framework within a larger range…They are to be used are reference prices from which to consider trade opportunities, not hard trade levels.

Scenario 1: Price has reached Average Cycle Target (2093.00)…The Rally is in place, so any further strength will need to convert this level to produce higher targets. Key SPOTS to be mindful of are 2095.50…2098.00…2100…2105.00 TargetMaster Range Breakout Level.

Scenario 2: Since Cycle Target has been achieved, price is free to move in either direction today as the bias is NEUTRAL SPILL…IF price fails to convert 2093.00 SPOT, THEN downside levels to be mindful of are: 2082.50 3D CPZ, followed by 2075.50, 2071.50 for pullback buy response.

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

“Knowing is not enough, We must APPLY. Willing is not enough, We must DO.” –Bruce Lee

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