Volatility predicted, and volatility there was. A speech from Fed Chair Jay Powell on Wednesday sent markets flying amid signals that the central bank could begin slowing its aggressive interest rate increases. When the dust settled at the end of the session, the Nasdaq Composite (COMP.IND) closed up a whopping 4.4%, while the S&P 500 (SP500) and the Dow (DJI) finished the day ahead by 3.1% and 2.2%, respectively.
8:30 Initial Jobless Claims
8:30 Personal Income and Outlays
9:25 Fed’s Logan Speech
9:30 Fed’s Bowman Speech
9:45 PMI Manufacturing Index
10:00 Fed’s Kashkari Speech
10:00 ISM Manufacturing Index
10:00 Construction Spending
10:30 EIA Natural Gas Inventory
3:00 PM Fed’s Barr Speech
4:30 PM Fed Balance Sheet
***New: PTG Trading Room Chat Log’s Link
Prior Session was Cycle Day 1 (CD1): Normal CD1 as price declined, establishing a new cycle low at 3942.75 by Noon. JPOW’s dovish speech sparked an explosive rally driving price to fulfill 3-Day Cycle Target (4075) all in same session. “Yes, Virginia, there is a Santa Claus” Prior range was a whopping 150 handles on 2.350M contracts exchanged.
…Transition from Cycle Day 1 to Cycle Day 2
This leads us into Cycle Day 2 (CD2): Price is trading in a relatively narrow range following prior session’s rally. Normal for Cycle Day 2 is for some consolidation with a bullish lean. As such, estimated scenarios to consider for today’s trading.
Bull Scenario: Price sustains a bid above 4095 initially targets 4115 – 4125 zone.
Bear Scenario: Price sustains an offer below 4095, initially targets 4075 – 4065 zone.
PVA High Edge = 4049 PVA Low Edge = 3932 Prior POC = 3960
Range Projections and Key Levels (ES) December 2022 (Z) Contract
Nasdaq 100 (NQ)
Today is Cycle Day 2 (CD2)…Normal CD1 as price declined, establishing a new cycle low at 11497.75 by Noon. JPOW’s dovish speech sparked an explosive rally driving price to fulfill 3-Day Cycle Target(11991.50) all in same session. “Yes, Virginia, there is a Santa Claus.” Normal for Cycle Day 2 is for some consolidation with a bullish lean. Prior range was a whopping 580 handles on 476k contracts exchanged.
Bull Scenario: IF Bulls sustains bid above 12086, THEN initial upside estimate targets 12141 – 12204 zone.
Bear Scenario: IF Bears sustains offer below 12086, THEN initial downside estimate targets 12016 – 11992 zone.
PVA High Edge = 11876 PVA Low Edge = 11498 Prior POC = 11557
Range Projections and Key Levels (NQ) December 2022 (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.”
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