Global stocks are on cruise control heading into a three-day weekend in the U.S. and with a key speech from Federal Reserve Chairwoman Janet Yellen on tap. The Fed chief is due to speak at Harvard University in her first public appearance in a couple of months. Most Fed watchers expect Yellen to stay on script, although some Q&A is expected. The Stoxx Europe 600 Index is essentially flat in mid-day trading, while Asian markets made small gains to end a strong week. The Nikki 225 Index rose 0.37% with President Obama in Japan for a historic visit to Hiroshima. Futures point to a calm opening for U.S. markets.
Crude oil prices are back below $50 in early trading on a round of profit taking by investors and with the U.S. dollar perking up. Traders are also positioning themselves ahead of the next OPEC meeting scheduled for just around the corner on June 2. Energy market watchers are unsure if key OPEC members will agree on a production cap or increase output. WTI crude is down 0.9% to $49.05/bbl, while Brent crude trading in London is 0.89% lower at $49.15/bbl.
In Asia, Japan +0.4% to 16835. Hong Kong +0.9% to 20577. China -0.1% to 2821. India +1.1% to 26664.
In Europe, at midday, London +0.1%. Paris +0.1%. Frankfurt +0.1%.
Futures at 6:20, Dow +0.1%. S&P +0.1%. Nasdaq +0.2%. Crude -0.9% to $49.05. Gold flat at $1223.10.
Ten-year Treasury Yield Flat at 1.82%
(Source: Seeking Alpha)
Quiet bullish consolidation yesterday ahead of the long Memorial Day Holiday. Expectation yesterday was for a relatively shallow decline to find a secure low. Buyers stepped in between 2083 – 85 so this zone will be marked as key support.
Today is Cycle Day 2 (CD2)…Normally we are expecting a continuation higher following shallow pullback. With long holiday upon us and many traders have departed for the weekend, today’s CD2 dovetails nicely with a potential for higher target levels to be fulfilled.
Range Projections and Key Levels: June (M) Contract
HOD Range Projection: 2109.05; LOD Range Projection: 2071.45; CD2 Max Penetration Level: 2102.50; CD2 Max Violation Level: 2075.25; Cycle Day 1 Low: 2082.50; 3 Day Central Pivot: 2079.25; 3 Day Cycle Target: 2107.00; 10 Day Average True Range: 21.05
**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 PH (2091.75), THEN initial upside objective is 2100.00 – 2103.25 STATX Zone. 3 Day Cycle Target = 2107.00…HOD ATR Range Projection = 2109.05.
Scenario 2: Violation and conversion below 2088.00 would be initial sign of weakness (SOW)…Should this occur expectation remains for responsive buyers at layered levels down to 2082.50 (CD1 Low).
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.”
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