Markets

Chinese stocks surged today on news the country would further open its markets to foreign investment by establishing a trading link between Shenzhen and Hong Kong by the end of the year. The People’s Bank of China later clarified that the comments from Governor Zhou Xiaochuan were made in May, while plans for the link still need regulatory approval and a deal has not yet been made. That didn’t stop Chinese markets from soaring: Shanghai +4.3%; Hang Seng +2.1%; Shenzhen +5.1%.

Today’s Economic Calendar

7:00 MBA Mortgage Applications
8:15 ADP Jobs Report
8:30 International Trade
8:30 Gallup U.S. Job Creation Index
8:30 Treasury Refunding Quarterly Announcement
9:45 PMI Services Index
10:00 ISM Non-Manufacturing Index
10:00 Yellen testify before House Financial Services
10:30 EIA Petroleum Inventories
1:00 PM Results of $26B, 2-Year Note Auction

PTG Trading

Bulls continued there demand hunting driving prices further higher to reach 2108.75 Penetration Level outlined in prior DTS Report 11.03.15. Bulls clearly remain in control as any counter-offensive by Bear Camp continues to get thwarted by Bull Camp. Until there is a meaningful change in balance of power, it’s buy the pullback to key decision points.

Overnight trade is quiet and range is relative narrow, between 2100 – 2108.75. Expansion above prior high 2110.25 is required to reach this Cycle Target of 2122.50.

Today is Cycle Day 2 (CD2)…NEUTRAL SPILL UP…Odds of Rally > 10 = 84%; Odds of Rally > 20 = 45%; Average Range = 14.50; Max Average Range = 22.50; Possible HOD = 2122.50; Possible LOD = 2019.00

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

Today’s Hypotheses: December (Z) 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: Bulls have the ball…IF price can clear and convert PH (2110.25), THEN initial upside targets 2113.75 – 2115.00…Above this zone measures 2118.50, then 2121.25 – 2122.50.

Scenario 2: Any decline should be viewed as a buying opportunity from larger institutional traders/investors, so any decline may be relatively shallow. Levels to be mindful of on any decline are: 2100.00 Central Pivot which is initial support. Below this level are 2096.25, 2093.50, 2091.00 SPOTs.

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

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