Brent crude is shattering records, losing a fifth of its value in the last month and a third since early October. The benchmark has now hit levels not seen since 2004, skidding 2% to as low as $36.06 per barrel, as oversupply concerns and a strong dollar continue to weigh on the market. With a ban on U.S. oil exports lifted and new supplies looming from Iran, West Texas Intermediate crude is also feeling the pressure, down 0.9% at $34.42/bbl, its lowest since February 2009. (Source: Seeking Alpha)
8:30 Chicago Fed National Activity Index
Friday was Cycle Day 1 (CD1) and in good form performed as expected with a decline, aided by expiring options contracts. All major market events are now history and with eight trading days remaining for this year, expectation is for reduced volumes and participation. Many will be looking to signs of Santa coming to town for year-end rally.
Today is Cycle Day 2 (CD2)…NEUTRAL UP SPILL…Odds of Rally > 10 = 84%; Odds of Rally > 20 = 45%; Average Range = 14.50; Max Average Range = 22.75; Possible HOD = 2018.25; Possible LOD = 1079.50.
***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: IF price clears and converts 2000.00, THEN, initial upside objective is 2012.50, followed by 2018.25 Average Cycle Rally Target.
Scenario 2: Violation of PL (1991.00), opens door for further selling targeting 1986 – 1981.25 STATX Zone. Below this zone measures 1979.50 down to 2071.50 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!
“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