World shares are following crude lower, after the world’s largest oil exporters failed to reach an agreement in Doha to freeze output at January levels. The major sticking point during the meeting was the heightened tension between Saudi Arabia, the de facto OPEC leader, and Iran, which made a last-minute decision not to attend the gathering. Although no one expected Tehran to freeze production after its international sanctions were lifted, it wasn’t clear if the Saudis would demand that Iran immediately join the pact. Crude futures -3.1% to $40.42/bbl.
In Asia, Japan -3.4% to 16276. Hong Kong -0.7% to 21162. China -1.4% to 3033. India +0.7% to 25816.
In Europe, at midday, London -0.3%. Paris -0.2%. Frankfurt -0.2%.
Futures at 6:20, Dow -0.2%. S&P -0.3%. Nasdaq -0.2%. Crude -3.1% to $40.42. Gold +0.4% to $1239.70.
Ten-year Treasury Yield flat at 1.74%
(Source: Seeking Alpha)
10:00 NAHB Housing Market Index
7:00 PM Fed’s Rosengren speech
Friday’s trade session was fairly quiet with little trade opportunities as options expiration and lack of commitment by investors was main theme. Failure to reach oil production freeze has pushed prices lower in overnight trade down to 2060.00 CD3 Max Violation Level. Pre-cash open prices have snapped back to 2073 handle within the 3 Day Central Pivot Zone.
Today is Cycle Day 3 (CD3)…IFFY…Given recent price action and a bit of confusion regarding direction for today, price could trade in either direction, so we will call it an “iffy” day. Definitive clear and conversion of 2074 handle will continue to support bullish outcome while a conversion below 2060 SPOT would increase odds of further downside.
Range Projections and Key Levels: June (M) Contract
HOD Range Projection = 2078.77; LOD Range Projection = 2052.48; CD3 Maximum Penetration Level = 2094.75; CD3 Maximum Violation Level = 2060.17; Cycle Day 1 Low = 2068.50; 3 Day Central Pivot = 2073.25; 3 Day Cycle Target = 2099.36; 10 Day Average True Range = 22.27.
**Note: The odds highlighted are NOT predictions or trade recommendations, rather a guide based upon historical observed occurrences.
Today’s Hypotheses: June (M) 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: Price is currently trading at Cycle Day 1 Low (2068.50) in pre-cash trade…It will need to hold and stabilize above this level for the bulls to push for higher ground. IF this occurs, initial objective will be to clear and convert 2074.00 handle which would target 2078.00.
Scenario 2: Failure to convert 2068.50 to upside reflects a rejection which increase odds of retesting 2060 handle. Violation and conversion of this level opens trap door for lower prices targeting 2052.48.
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