Markets
“Explosive,” “shock” and “relief” are some of the adjectives being used to describe the rally on Thursday as stocks recorded their best session since the early days of the pandemic in 2020. When all was said and done, the Dow Jones Industrial Average and S&P 500 closed out the session up 3.7% and 5.5%, respectively, while the tech-heavy Nasdaq Composite Index skyrocketed 7.4%. U.S. government bond yields also recorded their steepest one-day decline in more than a decade, with the rate on the 10-year Treasury falling 32 basis points to 3.82%.
Economic Calendar
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S&P 500
Prior Session was Cycle Day 2 (CD2): Bullish CPI print resulted in a whopping 222 handle rally rising above two-week highs. Range was 222 handles on 2.296M contracts exchanged.
…Transition from Cycle Day 2 to Cycle Day 3
This leads us into Cycle Day 3 (CD3): Cycle Targets are naturally exceeded, so today we’ll mark as a “wild-card.” Bulls have dominant control, so being Friday it’s theirs to lose. Normal following a strong trend day would be some back n fill to consolidate recent gains. As such, estimated scenarios to consider for today’s trading.
Bull Scenario: Price sustains bid above 3973, initially targets 4000 – 4005 zone.
Bear Scenario: Price sustains offer below 3973, initially targets 3950 – 3945 zone.
PVA High Edge = 3942 PVA Low Edge = 3859 Prior POC = 3915
Range Projections and Key Levels (ES) December 2022 (Z) Contract
HOD ATR Range Projection: 4050; LOD ATR Range Projection: 3905; 3 Day Central Pivot: 3838; 3 Day Cycle Target: 3858; 10 Day Average True Range 106; VIX: 23
Nasdaq 100 (NQ)
Today is Cycle Day 3 (CD3)…Cycle Targets are naturally exceeded, so today we’ll mark as a “wild-card.” Bulls have dominant control, so being Friday it’s theirs to lose. Normal following a strong trend day would be some back n fill to consolidate recent gains. As such, estimated scenarios to consider for today’s trading.
Bull Scenario: IF Bulls sustains bid above 11670, THEN initial upside estimate targets 11775 – 11785 zone.
Bear Scenario: IF Bears sustains offer below 11670, THEN initial downside estimate targets 11575 – 11555 zone.
PVA High Edge = 11527 PVA Low Edge = 11231 Prior POC = 11440
Range Projections and Key Levels (NQ) December 2022 (Z) Contract
HOD ATR Range Projection: 11976; LOD ATR Range Projection: 11420; 3 Day Central Pivot: 11138; 3 Day Cycle Target: 11220; 10 Day Average True Range: 410; VIX: 23
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.
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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 SHOWN6.22.22