Stocks are continuing their march higher following a predicted move by the Fed to wind down its pandemic-era bond purchases. The central bank will cut its monthly Treasury purchases by $10B and mortgage-backed securities by $5B, bringing an end to the program in mid-2022. Prior to the announcement, the Dow and S&P 500 were trending down, but picked up after the decision was announced and closed in positive territory.
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Prior Session was Cycle Day 2 (CD2): Indexes continued their upward march to new all-time highs lead by the Fed’s drum beat. DON’T FIGHT THE FED mantra is wringing-out loudly. Range was 44 handles on 1.039M contracts exchanged.
…Transition from Cycle Day 2 to Cycle Day 3
This leads us into Cycle Day 3 (CD3): Momentum is in the bullish camp, so it is theirs to lose. Until there is a shift, our plan remains unaltered…Stay in alignment with the dominant force on pullbacks to key Decision Point Zones (DPZ). As such, estimated scenarios to consider for today’s trading.
1.) Price sustains a bid above 4658, initially targets 4668 – 4675 zone.
2.) Price sustains an offer below 4658, initially targets 4646 – 4640 zone.
*****3 Day Cycle has a 91% probability of fulfilling Positive Cycle Statistics covering 12 years of recorded tracking history.
PVA High Edge = 4643 PVA Low Edge = 4613 Prior POC = 4617
Range Projections and Key Levels (ES) December 2021 (Z) Contract
Nasdaq 100 (NQ)
Today is Cycle Day 3 (CD3)…Price is trading above prior range during overnight activity as cycle objective has been exceeded (16092). Prior range was 211 handles on 444k contracts exchanged. As such, there are two estimated scenarios to consider for today’s trading.
PVA High Edge = 16013 PVA Low Edge = 15942 Prior POC = 15977
Bull Scenario: IF Bulls sustain a bid above 16145, THEN initial upside estimate targets 16179 – 16203 zone.
Bear Scenario: IF Bears sustain an offer below 16145, THEN initial downside estimate targets 16120 – 16100 zone.
Range Projections and Key Levels (NQ) December 2021 (Z) Contract
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!
“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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