Trade Strategy 09.19.14

Markets traded in a relatively narrow range yesterday as bullish momentum continued to hold price firm with barely a pullback during the day session. We had stated in prior DTS: “IF current bullish momentum remains strong, any pullback my be relatively shallow.”

The CD1 low (1993.00) came very early in Globex and never pulled back to test…Day Session held Key 1998 level we outlined in Pre-Market Briefing. This new Cycle has legs and could indeed carry price much higher forcing Shorts to cover. Friday is Quad Options Expiration, so plenty of cross-currents may develop throughout the session.

Today is Cycle Day 2 (CD2)…Average Rally = 17.50; Max Rally = 22.25; Odds of Rally > 10 = 83%; Odds of Rally > 20 = 44%; Average Range = 14.50; Max Range = 22.25

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

Today’s Hypotheses:

Scenario 1: Prices are in bullish mode…Any pullback we would anticipate responsive buyers to step-in to absorb supply..Key Price Zone to be mindful of is 1998 – 2000 PDVTMP. The initial Cycle Target is 2010.50…Price has almost achieved that objective in overnight trade…Should price continue to exceed this level, upper targets 2013.50 – 2015.50 Cycle Xtremes.

Scenario 2: Initial Cycle Target is 2010.50…Failure to exceed this level suggests buyers have their fill and a pullback to prior support zone (1998 – 2000) for renewed buy response. Any violation of this zone warrants lower probe to 1995 – 1993 STATX Zone.

Trade Strategy: The bullish momentum is clearly the dominant force post FED…We need to respect this regardless of the price level…Buying pullbacks to Key Decision Point Pivots remain the tactical trade. Should there be a reversal in price structure and momentum, only then would we shift to the short-side trade, remaining in alignment with dominant force.

Stay Focused…Take the Trade….ALWAYS USE STOPS!

Good Trading…David

Habitude Eight
I can recover from any setback. I have an attitude of abundance. I affirm abundance in the universe. I know I cannot begin to count the stars. I realize the ocean doesn’t care whether I go to it with a bucket or a teaspoon. I know the market provides a river of opportunities. I invest in my capabilities. I will be happy with my results.


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