Markets
The rally for sovereign debt has passed an important milestone, with the yield on Germany’s benchmark 10-year bonds hitting zero for the first time and briefly entering negative territory. The strong demand is standing out in cautious trade ahead of a series of policy meetings at major central banks and rising uncertainty over whether the U.K. will stay in the EU.
The Federal Open Market Committee is set to begin a two-day meeting on interest rate policy. Traders will eye a fresh batch of economic projections and remain focused on when the Fed will next raise rates, although they are discounting any chance the central bank will act at the gathering. Expectations fell significantly after June’s dismal employment report, which set off fresh concerns about the strength of the economy.
In Asia, Japan -1% to 15859. Hong Kong -0.6% to 20387. China +0.3% to 2842. India flat at 26,395.
In Europe, at midday, London -1.2%. Paris -1.3%. Frankfurt -0.7%.
Futures at 6:20, Dow -0.2%. S&P -0.2%. Nasdaq -0.3%. Crude -1.3% to $48.27. Gold -0.3% to $1282.90.
Ten-year Treasury Yield -3 bps to 1.58%
(Source: Seeking Alpha)
Economic Calendar
FOMC meeting begins
6:00 NFIB Small Business Optimism Index
8:30 Retail Sales
8:30 Import/Export Prices
8:55 Redbook Chain Store Sales
10:00 Business Inventories
PTG Trading
Early rally following lower gap open faded as price could not maintain solid bid above Friday’s settlement (2087.75). Retrace and violation of 2076 handle accelerated selling during afternoon session pushing lower to hit 2070.50 Low of Day price projection.
Today is Cycle Day 2 (CD2)…Strong negative price momentum may take price lower to find secure low before any rally can begin…Early key marker for support will be 2060 – 2062 zone. Should price find strong enough buy response then a relief rally has chance to develop. Price would at minimum need to clear and convert prior low (2068.75) before any price stabilization can occur.
Range Projections and Key Levels: Sept (U) Contract
HOD Range Projection: 2098.50; LOD Range Projection: 2055.80; CD2 Max Penetration Level: 2098.50; CD2 Max Violation Level: 2062.00; Cycle Day 1 Low: 2068.75; 3 Day Central Pivot: 2089.50; 3 Day Cycle Target: 2098.50; 10 Day Average True Range: 15.95
**Note: The odds highlighted are NOT predictions or trade recommendations, rather a guide based upon historical observed occurrences.
Today’s Hypotheses: June (M) 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 can hold at or above 2060 – 62 zone, THEN initial objective is to recapture PL (2068.75) and convert to support. Should this develop, layered upside levels are: 2071.00…2074.25…2078.00
Scenario 2: Failure to convert PL (2068.75) to support and/or violation of 2060 – 62 zone opens door for further selling with lower extreme target measured at 2055 handle. Deep extreme runs down to 2050 SPOT.
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.
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