Trade Strategy 1.27.16

Posted on by January 27, 2016
Markets
Markets are awaiting a policy decision from the U.S. Federal Reserve later in the session and a statement that might yield signs regarding the pace of future rate hikes. Citing improved inflation and other data, the central bank raised rates last month for the first time since the global financial crisis, but uncertainty over the strength of the dollar, low oil prices and China’s outlook have prompted warnings against raising rates too fast. U.S. futures:
In Asia, Japan +2.7% to 17164. Hong Kong +1% to 19052. China -0.5% to 2736. India flat at 24292.
In Europe, at midday, London -0.5%. Paris -0.6%. Frankfurt -0.8%.
Futures at 6:20, Dow -0.4%. S&P -0.4%. Nasdaq -1%. Crude -3.5% to $30.26. Gold -0.3% to $1116.80.
Ten-year Treasury Yield flat at 2.00%

(Source: Seeking Alpha)

Today’s Economic Calendar

7:00 MBA Mortgage Applications
10:00 New Home Sales
10:30 EIA Petroleum Inventories
11:30 Results of $15B, 2-Year FRN Auction
1:00 PM Results of $35B, 5-Year Note Auction
2:00 PM FOMC Announcement

PTG Trading

S&P e-mini has reached  3 Day Cycle Target (1894.00) and HOD Projection (1895.75) in yesterday’s Session. Today is FED Day, so market participants will essentially be in a holding pattern until the 2 pm release. Average True Range (10) continues to hold steady at 44.50 handles and correlation factor of 0.97 versus Crude Oil. Range overnight is relatively narrow at 12.25 handles.

Today is Cycle Day 3 (CD3)…SPILL IFFY…Since price has reached cycle price objective and with FOMC on tap, price action could take a turn in either direction based upon markets interpretation of forward comments release, so we will defer to the greater collective intelligence for next directional move.

Range Projections and Key Levels:

HOD = 1895.75; LOD = 1841.25; CD3 Max Penetration Level = 1912.00; CD3 Max Violation Level – 1837.75; Central Pivot = 1879.75; 3 Day Central Pivot Zone = 1884.25 = 1880.25.

**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: March 2016 (H) 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 holds 1879.75 Central Pivot and subsequently clears and converts PH (1899.75), THEN upside range expansion objective measures layered levels between 1904.00 – 1912.00.

Scenario 2: Failure to convert PH (1899.75) and subsequent violation and conversion of 1879.75 SPOT opens door to deeper downside move initially targeting 1868.00 (CD1 Low)…Below this level measures 1862.00 – 1860.00, with deep statistical extremes (STATX) between 1855.50 – 1849.75…LOD projection and CD3 Max Violation levels are 1841.25 – 1837.75 respectively.

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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