Trade Strategy 2.12.18

Markets

U.S. stock index futures are up by 1.2%, but with yields on U.S. 10-year Treasury paper touching a four-year top of 2.885%, it’s too early to sound an all-clear on volatility. Another upcoming challenge will be the release of U.S. consumer price data on Wednesday – given that it was fears of faster inflation, and thus more aggressive rate rises, that triggered the global rout in the first place.

In Asia, Japan -2.3%. Hong Kong -0.2%. China +0.8%. India +0.9%
In Europe, at midday, London +1.1%. Paris +1.3%. Frankfurt +1.5%
Futures at 6:20, Dow +1.2%. S&P +1.2%. Nasdaq +1.2%. Crude +1.7% to $60.20. Gold +0.5% to $1322.10. Bitcoin +7.2% to $8651. 
Ten-year Treasury Yield +5 bps to 2.88%

(Source: Seeking Alpha)

Economic Calendar

2:00 PM Treasury Budget

S&P 500 (ES)

Today is Cycle Day 2 (CD2)…Rally which began in prior session continues in overnight trade as price is higher by 30 handles fulfilling CD2 average penetration target of 2650. Bulls will need to continue pushing above this level for further upside expansion.

Scenario 1: IF price converts PH (2637.75), THEN initial target measures 2650, followed by 2660 – 2668 zone.

Scenario 2: IF price violates PH (2637.50), THEN initial target measures PC 2621.50.

HOD  ATR Range Projection: 2696.25; LOD ATR Range Projection: 2581.75; Cycle Day 1 Low: 2530.25; 3 Day Central Pivot: 2634.75; 3 Day Cycle Target: 2566.75; 10 Day Average True Range 73.25; VIX: 26.21

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Nasdaq 100 (NQ)

Today is Cycle Day 2 (CD2)…Price continuing to rally in overnight trade fulfilling CD2 Penetration Level (6498.00. Bulls will need convert this level to support to expand the rally targeting 6580 – 6600 zone.

Scenario 1: IF price converts PH (6455.50), THEN initial upside measures 6474 – 6498 CD2 penetration zone.

Scenario 2: IF price violates PH (6455.50), THEN initial downside targets PC (6425.75)…Failure to secure support opens door to deeper downside targeting 6330 VPOC zone.

Range Projections and Key Levels (NQ)

HOD  ATR Range Projection: 6615.30; LOD ATR Range Projection: 6297.50; Cycle Day 1 Low: 6164.00; 3 Day Central Pivot: 6455.25; 3 Day Cycle Target: 6259.00; 10 Day Average True Range: 201.05; VIX: 26.21

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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.”

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.

CFTC RULE 4.41 –HYPOTHETICAL OR SIMULATED PERFORMANCE RESULTS HAVE CERTAIN LIMITATIONS. UNLIKE AN ACTUAL PERFORMANCE RECORD, SIMULATED RESULTS DO NOT REPRESENT ACTUAL TRADING. ALSO, SINCE THE TRADES HAVE NOT BEEN EXECUTED, THE RESULTS MAY HAVE UNDER-OR-OVER COMPENSATED FOR THE IMPACT, IF ANY, OF CERTAIN MARKET FACTORS, SUCH AS LACK OF LIQUIDITY. SIMULATED TRADING PROGRAMS IN GENERAL ARE ALSO SUBJECT TO THE FACT THAT THEY ARE DESIGNED WITH THE BENEFIT OF HINDSIGHT. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFIT OR LOSSES SIMILAR TO THOSE SHOWN