Markets

Crude prices are set for a slow recovery, according to the latest report from the International Energy Agency, which warned against the deep investment cutbacks in the industry. In its World Energy Outlook, the IEA’s central scenario for oil prices forecast that the market would rebalance at $80 per barrel in 2020, “with further increases in price thereafter.” It also predicted that collectively, the U.S., EU and Japan would see their oil demand drop by around 10M barrels a day by 2040. (Source: Seeking Alpha)

Today’s Economic Calendar

6:00 NFIB Small Business Optimism Index
8:30 Import/Export Prices
8:55 Redbook Chain Store Sales
10:00 Wholesale Trade
1:00 PM Results of $24B, 10-Year Note Auction

PTG Trading

Markets failed to rise as expected yesterday, rather continued declining to reach 2066.25 CD2 Violation Level. Large Mutual Funds took advantage of price weakness to purchase $1.5B during Market on Close (MOC). With price at deep extremes, odds (83%) are favorable for at least a 10 handle rally targeting the 2077.50 CD1 Low. This level should provide Bears some initial defensive cover and become rally rejection point. Bulls will need to regain control above this key level to shift the current down dynamic.

Today is Cycle Day 3 (CD3)…Odds of 3D Rally . 10 = 83%; Odds of 3D Rally > 20 = 45%; Average Range = 17.75; Max Average Range = 22.00; Possible HOD = 2093.00; Possible LOD = 2049.00

***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: Price is currently above PL (2062.00) and below CD1 Low (2077.50) where overnight bounce was rejected. Price will need to hold current lows and clear and convert 2077.50 for Bulls to have any chance of sustained rally. Odds are in their favor, but they MUST PERFORM.

Scenario 2: Overnight bounce attempt was rejected at 2077.50 CD1 Low and is currently trading near 2066.25 CD2 Violation Level. IF price fails to violates PL (2062.00), THEN further price liquidation may occur targeting 2059.50 – 2055.25 STATX Zone followed by 2053.50 SPOT. Below this level remains 2049.29 prior weekly pivot and 2046.14 prior YELL.

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