Trade Strategy 12.16.21

Markets

Stock index futures are on the march higher this morning following the best Fed Day session in over a year. The S&P 500 rose 1.6% on Wednesday, erasing losses from the previous two sessions, and ended two points away from an all-time high.

Source: SeekingAlpha.com

Economic Calendar

8:30 Initial Jobless Claims
8:30 Philly Fed Business Outlook
8:30 Housing Starts and Permits
9:15 Industrial Production
9:45 PMI Composite Flash
10:30 EIA Natural Gas Inventory
11:00 Kansas City Fed Mfg Survey
4:30 PM Fed Balance Sheet

https://www.investing.com/economic-calendar/

***New: PTG Trading Room Chat Log’s Link

S&P 500

Prior Session was Cycle Day 2 (CD2): Markets propelled higher as dovish remarks by Fed’s Powell during the presser sparked the “BIG OPTIONS UNWIND”. Traders with bearish bets via put options quickly and aggressive sold those positions, forcing a buying surge in futures. Range was 104 handles on 1.781M contracts exchanged. 

 …Transition from Cycle Day 2 to Cycle Day 3

This leads us into Cycle Day 3 (CD3): Momentum has pushed price higher to fulfill CD3 Penetration Level (4731) during overnight trade activity. Cycle Statistics have been fulfilled, so we’ll mark today as a “wild-card” with bullish momentum firmly intact. As such, estimated scenarios to consider for today’s trading.

1.) Price sustains a bid above 4725, initially targets 4740 – 4745 zone. 

2.) Price sustains an offer below 4725, initially targets 4712 – 4698 zone.

*****The 3 Day Cycle has a 91% probability of fulfilling Positive Cycle Statistics covering 12 years of recorded tracking history.

PVA High Edge = 4647       PVA Low Edge = 4604         Prior POC = 4613

Range Projections and Key Levels (ES) March 2022 (H) Contract

HOD  ATR Range Projection: 4770; LOD ATR Range Projection: 4671; 3 Day Central Pivot: 4660; 3 Day Cycle Target: 4671; 10 Day Average True Range  72; VIX: 18.50

Nasdaq 100 (NQ)

Today is Cycle Day 3 (CD3)…Price has extended the prior session’s late day spike into the close, fulfilling CD3 Penetration level (16395) during overnight trade activity. Prior range was 560 handles on 694k contracts exchanged. As such, there are two estimated scenarios to consider for today’s trading.

PVA High Edge = 15961       PVA Low Edge = 15764     Prior POC = 15914

Bull Scenario: IF Bulls sustain a bid above 16370, THEN initial upside estimate targets 16435 – 16455 zone.

Bear Scenario: IF Bears sustain an offer below 16370, THEN initial downside estimate targets 16340 – 16325 zone.

Range Projections and Key Levels (NQ) March 2022 (H) Contract

HOD  ATR Range Projection: 16632; LOD ATR Range Projection: 16102; 3 Day Central Pivot: 16075; 3 Day Cycle Target: 16074; 10 Day Average True Range: 354; VIX: 18.50

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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