Trade Strategy 1.22.16

Markets
There’s a major relief rally going on across the globe, pushing equities up following several gut-wrenching sessions, after a dovish Mario Draghi hinted at more stimulus and crude prices continued to bounce higher. The ECB is not the only one suggesting additional easing. On Thursday, China’s Vice President Li Yuanchao signaled that Beijing would keep intervening in its stock market, and speculation is rife that the Bank of Japan could opt for extra stimulus at a policy meeting next week.

In Asia, Japan +5.9% to 16959. Hong Kong +2.9% to 19081. China +1.3% to 2917. India +2% to 24436.
In Europe, at midday, London +2.4%. Paris +3.2%. Frankfurt +2%.
Futures at 6:20, Dow +1.3%. S&P +1.4%. Nasdaq +1.8%. Crude +5.7% to $31.23. Gold flat at $1098.50.
Ten-year Treasury Yield +5 bps to 2.06%

(Source: Seeking Alpha)

Today’s Economic Calendar

8:30 Chicago Fed National Activity Index
9:45 PMI Manufacturing Index Flash
10:00 Existing Home Sales
10:00 Leading Indicators
1:00 PM Baker-Hughes Rig Count

PTG Trading

We wrote in prior DTS 1.21.16 Report : Scenario 1: IF price can hold above 1840 SPOT, THEN initial upside targets 1850, followed by 1866 3 Day Central Pivot. Above this level rally can accelerate to 1891.00.”

Support in-fact held 1840 during cash session allowing Bulls to maintain control, producing a well needed “relief-rally” which has pushed price higher to stated target of 1891.00 in overnight trade. The current Cycle and Range Projections have been spot-on given that volatility remains elevated at 45.75 handles for 10-Day Average True Range.

Today is Cycle Day 3 (CD3)…IFFY SPILL…Residual bullish momentum may continue to carry price higher targeting 1902.50 – 1908.00 3 Day Cycle Target. Bulls are going to work at producing a solid end of week trade, so we will maintain positive bullish bias for today as long as 1866 3 Day Central Pivot holds any pullback test.

**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: March 2016 (H) 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: IF price clears and converts PH (1883.25), THEN initial upside objective is 1891.00 SPOT…Strength above this level targets layered levels: 1895.75; 1902.50 – 1908.00.

Scenario 2: Price is currently above PH (1883.25)…Violation and conversion back down through this level produces a swing high and increases odds of pullback down to 1866 3D CPZ Pivot. Weakness below this level targets 1846.25 lower range projection.

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.”

PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS

IMPORTANT NOTICE! No representation is being made that the use of this strategy or any system or trading methodology will generate profits. Past performance is not necessarily indicative of future results. There is substantial risk of loss associated with trading securities and options on equities. Only risk capital should be used to trade. Trading securities is not suitable for everyone. Disclaimer: Futures, Options, and Currency trading all have large potential rewards, but they also have large potential risk. You must be aware of the risks and be willing to accept them in order to invest in these markets. Don’t trade with money you can’t afford to lose. This website is neither a solicitation nor an offer to Buy/Sell futures, options, or currencies. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this web site. The past performance of any trading system or methodology is not necessarily indicative of future results.
CFTC RULE 4.41 – HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN

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