Trade Strategy 10.20.15


Earnings reports will likely be a big driver for stocks today, after IBM’s (NYSE:IBM) disappointing results reinforced concerns that the corporate profit outlook is getting murkier. “We’re getting deeper into earnings season and not watching any one company, but the cumulative effect,” said Mark Luschini, chief investment strategist at Janney Montgomery. “Everybody knows this quarter is going to be bad.” On the earnings radar this week are several more heavy tech giants. On Wednesday, eBay (NASDAQ:EBAY) will announce results for the first time since it spun-off PayPal (NASDAQ:PYPL), and Thursday will see Microsoft (NASDAQ:MSFT), Amazon (NASDAQ:AMZN) and Alphabet (GOOG, GOOGL) release Q3 reports.

Today’s Economic Calendar

8:30 Housing Starts
8:55 Redbook Chain Store Sales
9:00 Fed’s Williams speech
11:00 Janet Yellen speech

PTG Trading

S&P e-mini (ES) continues to consolidate current gains as money managers, analysts and traders absorb a plethora of corporate earnings releases. Price remains in bullish uptrend condition as long as 2008.00 bid is not violated and converted to an offer.

Today is Cycle Day 3 (CD3)…NEUTRAL UP SPILL…There still remains room to expand range higher to reach 3 Day Cycle Target at 2034.75. Market on Close (MOC) Buy Imbalance of $1.6B was easily absorbed without much price movement. Bulls will need another strong performance but this time must expand outside the current range to get upside acceleration.

Odds of 3D Rally > 10 = 83%; Odds of 3D Rally > 20 = 54%; Average Range = 17.75; Max Average Range = 22.00; Possible HOD = 2034.75 Average Cycle Rally Target; Possible LOD = 2014.25 3D CPZ.

***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 (2028.00, THEN initial upside targets 2031.75, followed by 2034.75 Average Cycle Target. Strength above this level expands range to 2041.25 CD3 Penetration Level up to 2045.50 upper STATX Level.

Scenario 2: Failure to convert PH (2028.00) and subsequent violation and conversion of 2015 SPOT, opens door to deeper downside move initially targeting 2012 SPOT. Violation of this level targets 2008 SPOT.

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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