Trade Strategy 09.29.15


European stocks were mixed and U.S. futures were broadly higher at the time of writing as Glencore shares recovered from their whipping yesterday. The company’s performance in the previous session helped push Asian equities sharply lower today, while continued fears about China’s economy didn’t help. However, India’s Sensex rose after a greater-than-expected rate cut by the central bank.

Today’s Economic Calendar

8:55 Redbook Chain Store Sales
9:00 S&P Case-Shiller Home Price Index
10:00 Consumer Confidence
10:00 State Street Investor Confidence Index
3:00 PM Farm Prices
8:30 Producer Price Index
10:00 Reuters/UofM Consumer Sentiment
2:00 PM Treasury Budget

PTG Trading

Selling (long liquidation) continued uninterrupted as “risk-off” dominated the trading landscape. When the session ended, Market Internals and Net Cumulative Delta metrics told the story…minus 61 handles.

Today is Cycle Day 3 (CD3)…Unless price can recover back above CD1 Low (1910.25), this will be consecutive 3 Day Rally Failures…Tell tale sign of bearish corrective sentiment.

Odds of 3D Rally > 10 = 82%; Odds of 3D Rally > 20 = 54%; Average Range = 17.75; Max Average Range = 21.75; Possible HOD = 1911.50; Possible LOD = 1854.25.

***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: December (Z) 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 is currently above PL (1868.75)…IF price can hold above this level during cash session, THEN odds (82%) favor a “relief rally” initially targeting 1882.75, then 1891.00 Central Pivot. Further strength above this level targets 1899.25, followed by 1910.25, which is today’s bullish objective to qualify for positive 3 day rally.

Scenario 2: Violation and conversion of PL (1868.75) targets 1860.50, followed by 1858.00 – 1854.25 CD3 Violation Zone.

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

*****This trade strategy report is disseminated for “education only” and should not be viewed in any way as a recommendation to buy or sell futures products.”


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