Crude prices have fallen below $40 a barrel after Kuwaiti oil workers ended a three-day strike that had cut the OPEC member’s production by nearly half. Concerns about oversupply were further reinforced by API industry data that showed a 3.1M barrel U.S. inventory build last week, about double that expected by analysts. Bearish sentiment is also taking hold as traders continue to assess the impacts from the output freeze deal failure between major producers on Sunday. Oil futures -2.8% to $39.94/bbl.
In Asia, Japan +0.2% to 16907. Hong Kong -0.9% to 21236. China -2.3% to 2976. India +0.1% to 25844.
In Europe, at midday, London -0.5%. Paris flat. Frankfurt -0.1%.
Futures at 6:20, Dow -0.2%. S&P -0.2%. Nasdaq -0.2%. Crude -2.8% to $39.94. Gold -0.3% to $1250.20.
Ten-year Treasury Yield-1 bps to 1.77%
(Source: Seeking Alpha)
HOD Range Projection = 2106.08; LOD Range Projection = 2074.17; CD2 Maximum Penetration Level = 2109.78; CD2 Maximum Violation Level = 2065.57; Cycle Day 1 Low = 2084.75; 3 Day Central Pivot = 2081.75; 3 Day Cycle Target = 2110.68 10 Day Average True Range = 20.33.
**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: IF price clears and converts CD1 High (2098.50), THEN initial upside is 2101.00…Further strength above this level expands rally targeting 2106.08, followed by 2109.78 – 2110.68 3 Day Cycle Rally Target.
Scenario 2: In initial Sign of Weakness (SOW) would be a violation and conversion of CD1 Low (2084.75)…IF this scenario unfolds, THEN initial downside measures 2081.75 – 2080.00 3 Day Central Pivot Zone. Below this zone targets 2075.00 – 2074.17 LOD ATR Range Projection.
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