Markets (Top Stories)
Policymakers at the Fed are treading a tightrope as they seek to balance their role as providers of stable prices and financial stability. The FOMC voted unanimously yesterday to raise the target for the federal funds rate by a quarter percentage point to a range of 4.75% to 5%, seeking a compromise between pausing its rate hike cycle due to the current banking crisis and prior expectations of 50 bps to counter stubbornly high inflation. It marked the ninth straight meeting that the central bank raised rates, though it’s far from clear what may lie ahead despite a press conference from Fed Chair Jerome Powell.
Economic Calendar
8:30 Initial Jobless Claims
8:30 Chicago Fed National Activity Index
8:30 Current Account
10:00 New Home Sales
10:30 EIA Natural Gas Inventory
11:00 Kansas City Fed Mfg Survey
4:30 PM Fed Balance Sheet
https://www.investing.com/economic-calendar/
S&P 500
Prior Session was Cycle Day 1 (CD1): This session was relatively quiet up until the FED Policy Statement and Presser, when all hell broke loose, with a “Wild Ride Clyde” afternoon session. JPOW did not install confidence with investors that the banking crisis will subside any time soon. Markets gyrated wildly and in the end closed on lows of the day. Prior range was 107 handles on 1.733M contracts exchanged.
…Transition from Cycle Day 1 to Cycle Day 2
This leads us into Cycle Day 2 (CD2): Normal for CD2 is back n fill consolidation to work off recent activity. Price has rebounded during overnight recovering approximately half of M-Period decline. As such, estimated scenarios to consider for today’s trading.
Bull Scenario: Price sustains a bid above 4000, initially targets 4015 – 4020 zone.
Bear Scenario: Price sustains an offer below 4000, initially targets 3975 – 3970 zone.
PVA High Edge = 4052 PVA Low Edge = 4018 Prior POC 4034
Range Projections and Key Levels (ES) June 2023 (M) Contract
HOD ATR Range Projection: 4067; LOD ATR Range Projection: 3904; 3 Day Central Pivot: 3994; 3 Day Cycle Target: 4052; 10 Day Average True Range 97; VIX: 21
Nasdaq 100 (NQ)
Prior Session was Cycle Day 1 (CD1): This session was relatively quiet up until the FED Policy Statement and Presser, when all hell broke loose, with a “Wild Ride Clyde” afternoon session. JPOW did not install confidence with investors that the banking crisis will subside any time soon. Markets gyrated wildly and in the end closed on lows of the day. Prior range was 404 handles on 702k contracts exchanged.
…Transition from Cycle Day 1 to Cycle Day 2
This leads us into Cycle Day 2 (CD2): Normal for CD2 is back n fill consolidation to work off recent activity. Price has rebounded during overnight recovering approximately half of M-Period decline. As such, estimated scenarios to consider for today’s trading.
Bull Scenario: IF Bulls sustains bid above 12850, THEN initial upside estimate targets 12910– 12920 zone.
Bear Scenario: IF Bears sustains offer below 12850, THEN initial downside estimate targets 12780 – 12760 zone.
PVA High Edge = 12978 PVA Low Edge = 12850 Prior POC = 12883
Range Projections and Key Levels (NQ) June 2022 (M) Contract
HOD ATR Range Projection: 13021; LOD ATR Range Projection: 12528; 3 Day Central Pivot: 12763; 3 Day Cycle Target: 13067; 10 Day Average True Range: 326; VIX: 21
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.
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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