Equities enter the new month on shaky ground, following the S&P’s worst January since 2009 (-5.1%) and a volatile month for oil prices. About a fifth of S&P 500 companies will report earnings this week, while lots of economic data (manufacturing figures, auto sales and Friday’s jobs report) could also help determine the future direction of stocks. Central bank talk could be yet another influence on the markets: Fed Vice Chairman Stanley Fischer will speak this afternoon on the economy, while Mario Draghi discusses the ECB’s annual report. BOJ Governor Haruhiko Kuroda is scheduled to speak Wednesday after the central bank’s surprising shift to negative interest rates.
In Asia, Japan +2% to 17865. Hong Kong -0.5% to 19596. China -1.8% to 2689. India -0.2% to 24825.
In Europe, at midday, London -0.4%. Paris -0.5%. Frankfurt -0.5%.
Futures at 6:20, Dow -0.2%. S&P -0.3%. Nasdaq -0.2%. Crude -1.1% to $33.24. Gold +0.6% to $1123.10.
Ten-year Treasury Yield flat at 1.93%
Today’s Economic Calendar
8:30 Personal Income and Outlays
8:30 Gallup US Consumer Spending Measure
9:45 PMI Manufacturing Index
10:00 ISM Manufacturing Index
10:00 Construction Spending
S&P e-mini vaulted higher on Friday to close January on a strong note, with more than $4B Market on Close Buy Imbalance. But is that enough to turn the overall negative sentiment around? We are not so sure…One thing that we do know is that volatility remains high, 10 Day Average True Range sitting at 38.42 handles.
Today is Cycle Day 3 (CD3)…NEUTRAL DOWN…Cycle Targets have been exceeded and maximum penetration levels achieved…So the next cycle decline can begin at anytime.
Range Projections and Key Levels:
HOD Range Projection = 1952.50; LOD Range Projection = 1894.00; Daily Pivot = 1913.50; 3 Day Central Pivot = 1893.75; Upper STATX Zone = 1941.75 – 1948.50; Lower STATX Zone = 1885.25 – 1876.50
**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 can hold above 1913.50 on pullbacks, THEN initial upside objective is 1922.25…Above this level targets 1926.50, then 1929.75…1932.50.
Scenario 2: Violation and conversion of 1913.50 targets 1904.75 followed by 1900.00 Roundie..then 1895.50 – 1892.00 3 Day Central Pivot Zone.
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
IMPORTANT NOTICE! No representation is being made that the use of this strategy or any system or trading methodology will generate profits. Past performance is not necessarily indicative of future results. There is substantial risk of loss associated with trading securities and options on equities. Only risk capital should be used to trade. Trading securities is not suitable for everyone. Disclaimer: Futures, Options, and Currency trading all have large potential rewards, but they also have large potential risk. You must be aware of the risks and be willing to accept them in order to invest in these markets. Don’t trade with money you can’t afford to lose. This website is neither a solicitation nor an offer to Buy/Sell futures, options, or currencies. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this web site. The past performance of any trading system or methodology is not necessarily indicative of future results.
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