By definition, minutes from central bank policy meetings are backward-looking, and that is precisely why the transcript from the Fed’s June gathering – to be released at 2 p.m. ET – will matter more than usual for investors. Since the conclave took place a week before the U.K.’s historic referendum, which briefly threw the financial markets into disarray, the minutes will provide extra clues to what the Fed felt about the economy prior to the Brexit vote. Other factors to watch: rate projections, a hiring slowdown, global forces and inflation.
In Asia, Japan -1.9% to 15379. Hong Kong -1.2% to 20495. China +0.4% to 3017. India -0.4% to 27167.
In Europe, at midday, London -1%. Paris -2.2%. Frankfurt -2.2%.
Futures at 6:20, Dow -0.6%. S&P -0.7%. Nasdaq -0.8%. Crude -1.2% to $46.02. Gold +1.3% to $1376.50.
Ten-year Treasury Yield -3 bps to 1.33%
(Source: Seeking Alpha)
This Cycle’s decline which began on Monday continued into prior session as trend day down from opening bell carried the day past lower targets. Market on Close (MOC) Buy Imbalance of $1.2B stemmed the decline. In overnight trade price bounced higher but found resistance and was rejected at 2085.50 Central Pivot. Price is currently trading below prior low (2072.50).
Today is Cycle Day 3 (CD3)…This Cycle is in jeopardy of a failure of positive cycle unless price can recover back above 2094.00 CD 1 Low.
Range Projections and Key Levels: Sept (U) Contract
HOD Range Projection: 2099.00; LOD Range Projection: 2053.50; CD3 Max Penetration Level: 2098.00; CD3 Max Violation Level: 2061.00; Cycle Day 1 Low: 2094.00; 3 Day Central Pivot: 2092.50; 3 Day Cycle Target: 2117.00; 10 Day Average True Range: 32.10
**Note: The odds highlighted are NOT predictions or trade recommendations, rather a guide based upon historical observed occurrences.
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: Price is currently trading below PL (2072.50)…First sign of strength (SOW) would be clearing and converting this level to support. Unless Bulls can then convert 2078 and 2086 to support, Bears have advantage.
Scenario 2: Failure convert PL (2072.50), keeps Bear case intact with this current down swing. Primary target below is 2061 handle with secondary target 2053.50 if Bears can force long liquidation.
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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