Trade Strategy 7.13.16

Markets

Global crude markets have undergone an “extraordinary transformation,” swinging from a major surplus to near balance in Q2, according to the IEA, but record high oil stocks are threatening the “recent stability of prices.” Middle Eastern output exceeded 31M bpd for a third month in June, while U.S. oil production slid 140K bpd to 12.45M, the agency said in its monthly report, which largely kept forecasts for supply and demand unchanged.

In Asia, Japan +0.8% to 16231. Hong Kong +0.5% to 21322. China +0.4% to 3060. India flat at 27815.
In Europe, at midday, London +0.2%. Paris +0.5%. Frankfurt +0.2%.
Futures at 6:20, Dow +0.1%. S&P +0.1%. Nasdaq +0.2%. Crude -1.4% to $46.17. Gold +0.4% to $1340.10.
Ten-year Treasury Yield -2 bps to 1.48%

(Source: Seeking Alpha)

Economic Calendar

7:00 MBA Mortgage Applications
8:30 Import/Export Prices
9:00 Fed’s Kaplan: Monetary Policy
10:00 Atlanta Fed’s Business Inflation Expectations
10:30 EIA Petroleum Inventories
1:00 PM Results of $12B, 30-Year Note Auction
2:00 PM Treasury Budget
2:00 PM Fed’s Beige Book
6:30 PM Fed’s Harker: Economic Outlook

PTG Trading

Shallow decline is typically a Sign of Strength (SOS) as sellers are unable to push price lower. Though yesterday was Cycle Day 1 (CD1) with expectation of some decline developing, we stated in prior DTS Report: “Potential exists for a decline (pullback), but until there is a new SOW, shorting momentum is a tough game.”

Buyers continued unchallenged as price moved high to register new highs. The current uptrend is firmly in place, so until there is a shift in sentiment, buying pullbacks has been working.

Today is Cycle Day 2 (CD2)…With price seemingly extended, care needs to be taken on trade selection. Remain disciplined and follow trade guidelines…Picking tops has historically been a “loser game”. Once there is a confirmed SOW, stay with whats been working.

Range Projections and Key Levels: Sept (U) Contract

HOD Range Projection: 2185.00; LOD Range Projection: 2125.75; CD2 Max Penetration Level: 2162.50; CD2 Max Violation Level: 2119.25; Cycle Day 1 Low: 2128.50; 3 Day Central Pivot: 2127.25; 3 Day Cycle Target: 2159.00; 10 Day Average True Range: 22.98.

**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: September (U) 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: Initial support is marked at 2141 Central Pivot…IF this level can hold, THEN 1st objective is to clear and convert PH (2149.25)…Should this occur initial target is 2151.75 – 2154 STATX Zone.

Scenario 2: First SOW would be violation and conversion of 2141 handle. IF this occurs, THEN levels to be mindful of are: 2139…2136…2133..2128 for possible renewed buy response.

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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