Trade Strategy 10.02.14

*****NOTE: This report was written at 8 pm ET Wednesday evening for Thursday Trade Session

Cycle Day 1 (CD1) lived up to its billing as a weak session as price probed lower for a new low…which may not have yet to be found…Violation of key 1958 – 1960 zone forced long liquidation we opined in prior Strategy Briefing…Yesterday’s range was 33.25 handles…which was approximately 1.5x the Max Range observed on CD1. Ten-handle rally late in session helped to stem further losses by settlement.

Today is Cycle Day 2 (CD2)…Odds of Rally > 10 = 83%; Odds of Rally > 20 = 45%; Average Range on CD2 = 14.50; Max Range = 22.25. Possible High on CD2 = 1950 – 52 zone based upon average rally; Possible Low = 1924.75 – 1923.75 based upon violation of CD1 Low.

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

Today’s Hypotheses:

Scenario 1: IF price can hold above Prior Day Low (1933.75) and muster up a strong buy response clearing 1944 level, THEN there is a 65% chance of price reaching 1946.50 – 1950.50 VTMP zone. Above that level targets 1954.75 – 1960.50.

Scenario 2: Violation of Prior Day Low (1933.75) could force margin selling (liquidation), pushing price down to 1924.75 – 1923.75 daily low target. TargetMaster Breakdown Target measures 1921.50.

Trade Strategy: With intra-day volatility on the rise with swings of increased magnitude in either direction, our main trade strategy will be to remain open and flexible to two-side trade, both long/short from key Decision Point Pivots (DPP). 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

Habitude Five
I think in terms of probabilities. I do not know, all I have are probabilities. Probabilities are at the core of my decisions. Through consistent application of the probabilities, I will win.


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