Markets
Denting some of the recent enthusiasm seen after last week’s CPI report, Federal Reserve Governor Christopher Waller called the 7.7% inflation print “enormous” and said it was “just one data point.” Markets surged following the figure showing that inflation pressures were decelerating, with traders long awaiting any sign of moderating consumer prices. It’s been nearly two years since the CPI figure was last at the Fed’s targeted goal of 2%, but the most recent 7.7% number was the lowest level since January.
Source: SeekingAlpha.com
Economic Calendar
https://www.investing.com/economic-calendar/
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S&P 500
Prior Session was Cycle Day 3 (CD3): This day resulted in consolidation balancing day following strong trend up conditions. Cycle Objectives were easily fulfilled and surpassed. Prior range was 59 handles on 1.844M contracts exchanged.
…Transition from Cycle Day 3 to Cycle Day 1
This leads us into Cycle Day 1 (CD1): Average Decline for CD1 measures 3920. Normal for CD1 is a decline to find a new secure cycle low. Overnight/pre-RTH activity has price quietly trading in a relatively narrow range. Expectation is for continued consolidation until Mr. Market decides on next directional move. As such, estimated scenarios to consider for today’s trading.
Bull Scenario: Price sustains a bid above 3975, initially targets 3995 – 4005 zone.
Bear Scenario: Price sustains an offer below 3975, initially targets 3955 – 3950 zone.
PVA High Edge = 3992 PVA Low Edge = 3960 Prior POC = 3967
Range Projections and Key Levels (ES) December 2022 (Z) Contract
HOD ATR Range Projection: 4065; LOD ATR Range Projection: 3908; 3 Day Central Pivot: 3890; 3 Day Cycle Target: 4075; 10 Day Average True Range 98; VIX: 24
Nasdaq 100 (NQ)
Today is Cycle Day 1 (CD1)…Average Decline for CD1 measures 11518. Normal for CD1 is a decline to find a new secure cycle low. Overnight/pre-RTH activity has price quietly trading in a relatively narrow range. Expectation is for continued consolidation until Mr. Market decides on next directional move.Prior range was 307 handles on 674k contracts exchanged. As such, there are two estimated scenarios to consider for today’s trading.
Bull Scenario: IF Bulls sustains bid above 11745, THEN initial upside estimate targets 11825– 11850 zone.
Bear Scenario: IF Bears sustains offer below 11745, THEN initial downside estimate targets 11685 – 11670 zone.
PVA High Edge = 11875 PVA Low Edge = 11692 Prior POC = 11842
Range Projections and Key Levels (NQ) December 2022 (Z) Contract
HOD ATR Range Projection: 12092; LOD ATR Range Projection: 11479; 3 Day Central Pivot: 11364; 3 Day Cycle Target: 12107; 10 Day Average True Range: 385; VIX: 24
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.”
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