Trade Strategy 2.5.18

Markets

Continuing their recent selloff,equities are sharply lower this morning after the DJIA closed more than 600 points lower Friday, marking only the ninth time in history that has happened. Bears appear to be fearful about the sudden acceleration in bond yields, which increases companies’ borrowing costs, amid increasing concerns over inflation and aggressive policy tightening. U.S. stock index futures: Dow -0.8%; S&P 500 -0.5%; Nasdaq -0.4%.

In Asia, Japan -2.6%. Hong Kong -1.1%. China +0.7%. India -0.9%
In Europe, at midday, London -1.2%. Paris -1.2%. Frankfurt -0.8%
Futures at 6:20, Dow -0.8%. S&P -0.5%. Nasdaq -0.4%. Crude -0.5% to $65.12. Gold +0.2% to $1340.30. Bitcoin -7.4% to $7584. 
Ten-year Treasury Yield +1 bps to 2.85

(Source: Seeking Alpha)

Economic Calendar

9:45 PMI Services Index
10:00 ISM Non-Manufacturing Index
12:30 PM TD Ameritrade IMX

S&P 500 (ES)

Today is Cycle Day 3 (CD3)…Price has reached 2733 cycle range statistical low in overnight trade action. Bulls will need a “goal-line” defensive stand to rebut the on-slot of selling. Coming into view now is 50 day sma (2723.71) with expectation of a buy response should it get hit. 10 Day Average True Range now stands @ 32 handles.

Scenario 1: Bulls must convert PC (2757.25) to get a relief rally targeting 2765 , then 2775 levels.

Scenario 2: Bears have opportunity to continue pressure targeting 2725 – 2723.71 zone.

HOD  ATR Range Projection: 2765.00; LOD ATR Range Projection: 2725.00; Cycle Day 1 Low: 2823.50; 3 Day Central Pivot: 2810.25; 3 Day Cycle Target: 2841.29; 10 Day Average True Range: 32.02; VIX: 19.03

Click Here

Nasdaq 100 (NQ)

Today is Cycle Day 3 (CD3)…Price has reached it cycle range statistical low target (6704.12)…Key VPOC (6684) may come into play for a buy response. 10 Day Average True Range now stand @ 90.55 handles

Scenario 1: Bulls MUST convert PC (6756.00) for a relief rally targeting 6788 handle, then 6836.60. 

Scenario 2: Bears have an opening to drive lower targeting 6684 – 6682 zone, then 6672.70 ATR (10) range low.

Range Projections and Key Levels (NQ)

HOD  ATR Range Projection: 6783.05; LOD ATR Range Projection: 6672.70; Cycle Day 1 Low: 6884.75; 3 Day Central Pivot: 6740.75; 3 Day Cycle Target: 6973.75; 10 Day Average True Range: 90.55; VIX: 19.03

Click Here

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