Trade Strategy 10.09.15


World shares are green across the board, although U.S. futures are holding their breath, after details from the Fed’s minutes cast further doubt on the prospect of a rate rise this year. European stocks just broke a one-month high and are poised for their best weekly gain since late January on renewed hopes central banks will keep monetary policy loose for longer. Overnight, Asian equities and currencies also marched higher following yesterday’s gains on Wall Street (the Dow ended above 17K for the first time since August, while the S&P 500 closed well past its 50-day MA of 1,995).

Oil prices are advancing into the $50s, pushing past a key level to record a gain of nearly 9% this week. Support appears to be coming from a variety of factors, including recent OPEC comments on tackling the global overhang, expectations of shrinking U.S. production and concerns about Russia’s military operations in Syria. Crude futures +2.5% to $50.64/bbl, the commodity’s highest level since July 22.

Today’s Economic Calendar

8:30 Import/Export Prices
9:15 Fed’s Lockhart: Monetary Policy
10:00 Wholesale Trade
1:30 PM Fed’s Evans: U.S. Economy and Monetary policy

PTG Trading

We have been referring to this current rally as a “Power Cycle”…One in which pullbacks have been relatively shallow as Institutional Managers have been buying every dip in price, forcing shorts (bears) into buying (covering) at progressively higher prices. This rally has been so powerful that it has triggered a Zweig Breath Thrust BUY SIGNAL.

Today is Cycle Day 2 (CD2)…NORMAL NEUTRAL UP…Odds of Rally > 10 = 84%; Odds of Rally > 20 = 45%; Average Range = 14.50. Max Average Range = 22.50; Possible HOD = 2011.75 (Cycle Target); Possible LOD = 1990.00 (Breakpoint)

***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: IF Price clears and converts PH (2008.75), THEN upside targets 2011.75, followed by 2014.25 – 2018.50 STATX Zone.

Scenario 2: Failure to convert PH (2008.75) and subsequent violation and conversion of 2004.50 SPOT, increases odds (65%) of deeper pullback in order to attract renewed buying. Levels to be mindful of on any retracement are: 1995.25…1990.00…1984.00 – 1979.50 3D CPZ.

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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