Strong Like Bull

Yesterday’s Cycle Day 1 (CD1) played out perfectly with early shorting opportunity against the Open Range Rotation Midpoint level 2003.50 and the STATX Zone. Price declined fulfilling the Average Decline of 13.50 pts historically observed on CD1. The high (2006.25) minus 13.50 (avg decline) = 1992.75 (price target). The actual low of day was 1992.75…”perfect hit”!

We will mark 1992.75 as this cycle’s “secure low”…Having a new cycle low in place, we can calculate the projected upside target based upon Average Rally of 16.50 pts. This would place the initial cycle price target at 2009.25.

Price has reached initial cycle target of 2009.25 in overnight trade and has backed off a touch to 2006.00 as of 8:00 am. Today’s pit session will be important in determining the staying power of the current cycle.

Today is Cycle Day 2 (CD2) and having achieved initial cycle price target in early trade, we will anticipate some “back n fill” price action to consolidate gains. Odds of Rally > 10 = 83%; Odds of Rally > 20 = 45%; Average Rally on CD2 = 16.25; Average Range = 14.50; Max Range = 22.25.

***Note: The odds highlighted are not predictions, rather a guide based upon historical observed occurrences.

Today’s Hypotheses:

Scenario 1: Prior Day High (PDH) 2006.25. IF price can maintain a bid above this level THEN there is a 65% chance of reaching initial cycle target of 2009.25. Above this level measures Xtreme Zone 2014.25 – 2015.00.

Scenario 2: Having reached initial cycle target 2009.25 in overnight trade, failure to maintain above PDH (2006.25) suggests the need to consolidate early gains. Initial pullback support to be mindful of is 2001.00 – 2003.50 zone, which is prior session Volume Trend MP and Open Range MP. Failure to hold this zone on pullback targets next key support at 3DCPZ 1998 – 2000.00 zone.

Trade Strategy: Having reached initial cycle target in overnight trade, we will be looking for short-side trade IF price fails to convert recent highs. The long-side trade will be considered from key support decision point (DP) zones highlighted above. Since today is CD2, some back n fill should be anticipated, and as such, we are flexible and open to two-sided trade opportunities.

Remain Disciplined…Focus on Execution and Trade Management. ALWAYS USE STOPS!

Good Trading…David

Habitude Eight
I can recover from any setback. I have an attitude of abundance. I affirm abundance in the universe. I know I cannot begin to count the stars. I realize the ocean doesn’t care whether I go to it with a bucket or a teaspoon. I know the market provides a river of opportunities. I invest in my capabilities. I will be happy with my results.


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