Trade Strategy 12.08.15

Markets

World shares extended a losing streak today as bourses came under pressure from weak Chinese trade data (see below) and fallout from Monday’s oil price rout, which saw crude plunge 6% to its lowest level in almost seven years. “All of this is just a reminder of the weaker China macro story, which is passing through into the global backdrop as we have seen with the drop in oil prices, as no one is prepared to cut supply,” said Simon Quijano-Evans, chief emerging markets strategist at Commerzbank. Investors are also moving to the sidelines before next week’s meeting where the Fed is expected to raise U.S. interest rates.

Intensifying concerns about the world’s second-largest economy, China’s November exports dropped 6.8% for a fifth consecutive month, while imports fell 8.7% over the same period, marking a decline for every month over the past year. The figures leave the country with a trade surplus of $54.1B. The data also comes after a report last week showed China’s manufacturing conditions slipping to the weakest level in more than three years, while inflation data tomorrow is forecast to show additional weakness in consumer prices. (Source: Seeking Alpha)

Today’s Economic Calendar

6:00 NFIB Small Business Optimism Index
8:55 Redbook Chain Store Sales
10:00 Job Openings and Labor Turnover Survey
1:00 PM Results of $13B, 3-Year Note Auction

PTG Trading

Cycle Day 1 (CD1) certainly lived up to and beyond expectations, as decline which was anticipated actually accelerated giving up most of gains from Friday’s bullish session. Late day bounce was encouraging, but could not hold in overnight trade as prices are now currently below Prior Low (2064.50). Continued weakness in the Cash Session projects lower prices between 2053.00 – 2048.00 zone.

Today is Cycle Day 2 (CD2)…NORMAL NEUTRAL…Odds of Rally > 10 = 84$; Odds of Rally > 20 = 45%; Average Range = 14.75; Max Average Range = 22.75; Possible HOD = 2080.00; Possible LOD = 2053.00.

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

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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: IF price can hold and stabilize above PL (2064.50), THEN odds (84%) a relief bounce, targeting 2074.50 SPOT. Bulls would need to convert 2075.50 SPOT to truly shift current price dynamics.

Scenario 2:  IF price violates and converts PL (2064.50), THEN initial downside is 2060.00 SPOT…Break below this level and there is a “price void” down to 2053.00, then 2048.00.

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. Disclaimer: Futures, Options, and Currency trading all have large potential rewards, but they also have large potential risk. You must be aware of the risks and be willing to accept them in order to invest in these markets. Don’t trade with money you can’t afford to lose. This website is neither a solicitation nor an offer to Buy/Sell futures, options, or currencies. No representation is being made that any account will or is likely to achieve profits or losses similar to those discussed on this web site. The past performance of any trading system or methodology 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

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