Markets

China moved to shore up shaky investor sentiment today following an equities selloff that rocked global financial markets on revived concerns about the country’s economic slowdown. The PBOC flooded its banking system with 130B yuan ($19.95B), marking the largest cash injection since September, while suspicions arose that it was also using state banks to simultaneously prop up the renminbi. Although world shares are still wobbly, traders today appear a little less frantic. (Source: Seeking Alpha)

In Asia, Japan -0.4% to 18374. Hong Kong -0.7% to 21453. China -0.3% to 3288. India -0.2% to 25580.
In Europe, at midday, London -0.2%. Paris -0.7%. Frankfurt -0.8%.
Futures at 6:20, Dow -0.6%. S&P -0.6%. Nasdaq -0.6%. Crude flat at $36.75. Gold +0.2% to $1077.50.
Ten-year Treasury Yield -1 bps to 2.23%

Today’s Economic Calendar

Auto sales
8:30 Gallup US ECI
8:55 Redbook Chain Store Sales

PTG Trading

S&P e-mini’s decline of 63+ handles tested the resolve of the Bulls as price tested the 12.14.15 low before rallying into the close with a Market on Close (MOC) Buy Imbalance exceeding $2B. Beginning of month inflow buying by the large mutual funds.

Price has retraced approximately 50% of yesterdays decline touching a high in overnight trade of 2017. Today’s ATR Target is 2017.90 and as such is projected HOD. Currently price is trading 1995 and has given back about half of late day rally.

Today is Cycle Day 2 (CD2)…NEUTRAL SPILL…Odds of Rally > 10 = 84%; Odds of Rally > 20 = 45%; Average Range = 14.50; Max Average Range = 22.75; Possible HOD = 2017.90; Possible LOD = 1989.25

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

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: Initial retracement range target of 2017 has been achieved and price has pullback from ONH (2017) to 1992 SPOT. Price will need to hold solidly above 2089.75 during cash session. Expectation is form range type trade today within current high/low parameters to stabilize price.

Scenario 2: Violation of 1989.75 opens door to retest CD1 Low (1980.25)…Break and conversion lower targets 1968 – 1963 CD2 Violation Levels.

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

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