Trade Strategy 5.23.16

Markets

Oil prices are slipping again, hit by a strong dollar and signs that global crude supply is holding up even as unplanned outages rise to at least a five-year high. Iran’s Deputy Oil Minister was also quoted on Sunday saying the Islamic Republic has no plans to join any output freeze since it’s still ramping up exports to pre-sanctions levels. According to Rokneddin Javadi, Tehran’s shipments probably won’t surpass 2.2M barrels per day until midsummer. Crude futures -1.3% to $47.80/bbl.

In Asia, Japan -0.5% to 16655. Hong Kong -0.2% to 19809. China +0.6% to 2844. India -0.3% to 25230.
In Europe, at midday, London -0.3%. Paris -0.9%. Frankfurt -0.7%.
Futures at 6:20, Dow -0.1%. S&P -0.1%. Nasdaq -0.1%. Crude -1.3% to $47.80. Gold -0.1% to $1251.30.
Ten-year Treasury Yield -2 bps to 1.82%

Economic Calendar

5:30 Fed’s Bullard: U.S. Monetary and Economic Policy
8:00 Fed’s Williams: Monetary Policy
9:45 PMI Manufacturing Index Flash
6:30 PM Fed’s Harper speech

PTG Trading

Friday’s Bull Gap held firm throughout the session as price tagged 2055 SPOT that was outlined as Key Resistance prior week. Option Expiry maintained a firm bid as price tested Open Range Midpoint (2045) and bounced into settlement (2050).

Overnight trade tested the 2055 level and was rejected, pushing price back to 2045 handle. Key marker for the bulls to convert to support remains 2056 – 2058 zone. So far they have not been able to accomplish this mission. Price action is becoming more range-bound as traders probe both upper and lower edges of range for breakouts…So far stalemate.

Today begins new Cycle Day 1 (CD1)….Normal expectation is for some type of decline to unfold…So be mindful of 2055 SPOT failing to convert to support and conversion of 2045 to resistance. This will be first sign of weakness (SOW).

Range Projections and Key Levels: June (M) Contract

HOD Range Projection: 2065.58; LOD Range Projection: 2033.92; CD1 Max Penetration Level: 2064.44; CD1 Max Violation Level: 2025.64; Cycle Day 1 Low: 2030.75; 3 Day Central Pivot: 2042.25; 3 Day Cycle Target: 2058.00; 10 Day Average True Range: 22.08

**Note: The odds highlighted are NOT predictions or trade recommendations, rather a guide based upon historical observed occurrences.

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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: The bullish case would require price holding above 2043 – 2045 zone followed by a conversion of 2056 to upper support. Should this occur further upside range expansion is possible targeting 2058, followed by 2062 – 2065 zone.

Scenario 2: IF price violates and converts 2045 handle to resistance, THEN initial objective will be to test 2042.25 – 2041.25 3 Day Central Pivot Zone for renewed buy response. Failure for buyer to materialize opens door for deeper probe for a new secure low. Lower levels for possible support are: 2038.50 – 2036.25 STATX Zone. Average Decline on CD1 measures 2033.10.

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


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