With voters set to choose a new president and Congress in five days, the Fed will likely keep a low profile when it winds down its two-day meeting today amid a tumultuous U.S. election campaign. While no action is expected, investors will be looking for how strongly a possible December move is communicated in the Fed’s official statement, as Chairwoman Janet Yellen isn’t scheduled to hold a press conference.
In Asia, Japan -1.8% to 17134. Hong Kong -1.5% to 22810. China -0.6% to 3102. India -1.3% to 27527.
In Europe, at midday, London -0.4%. Paris -0.8%. Frankfurt -0.9%.
Futures at 6:20, Dow -0.3%. S&P -0.3%. Nasdaq -0.3%. Crude -1.6% to $45.93. Gold +0.7% to $1297.50.
Ten-year Treasury Yield -2 bps to 1.79%
(Source: Seeking Alpha)
Price failed to clear above CD2 high and with violation/conversion of 2115 handle to lower resistance opened door for decline. We wrote in prior DTS Briefing 11.1.16 “Scenario 2: Violation and conversion of PL (2114.75) to lower resistance opens door for deeper decline targeting 2105 – 2103 zone, with deep extreme measuring 2097 handle.”
Today begins a new Cycle Day 1 (CD1)…With prior session decline the current low (2091.00) may be in place for this cycle. Overnight trade successfully tested 2095 – 2097 zone and as such rebound rally has begun. Price will need to hold this zone as support on any additional retest during cash session. Initial upside objective measures 2105 – 2110 zone.
Range Projections and Key Levels
**Note: The odds highlighted are NOT predictions or trade recommendations, rather a guide based upon historical observed occurrences.
Today’s Hypotheses: September (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 holds support at or above 2095 THEN initial upside objective is 2105, followed by 2110 Central Pivot Zone. Continued strength above this zone targets 2117 – 2119 3D CPZ.
Scenario 2: Violation and conversion of 2095 handle to lower support potentially forces long margin selling targeting 2088.50 – 2082.50 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!
“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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