Markets
A bond selloff is deepening after yesterday’s comments from Jerome Powell, which said the Fed is prepared to act even more aggressively to tackle inflation. The yield on the 10-year Treasury has soared 20 basis points to 2.32% since the remarks, leading to the worst month for the asset class since 2016.
Source: SeekingAlpha.com
Economic Calendar
10:00 Richmond Fed Mfg.
10:30 Fed’s Williams Speech
1https://www.investing.com/economic-calendar/
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S&P 500
Prior Session was Cycle Day 3 (CD3): Prices osculated throughout the session with a positive “tilt” given that cycle objectives had been met. Overall, in-line with expected action, as volatility continues to decline, which favors the bulls. Prior range was 58 handles on 1.322M contracts exchanged.
…Transition from Cycle Day 3 to Cycle Day 1
This leads us into Cycle Day 1 (CD1): Today begins a new cycle, with the Average Decline measuring 4360. Shallow decline during overnight activity has found a bid from 4435 and is currently trading near highs pre-RTH. Our Line-In-Sand is marked at 4455…Bullish lean above…Bearish lean below. Clear and conversion of PH (4473) opens skylight for bulls to expand range. As such, estimated scenarios to consider for today’s trading.
Bull Scenario: Price sustains a bid above 4455, initially targets 4470 – 4475 zone.
Bear Scenario: Price sustains an offer below 4455, initially targets 4435 – 4430 zone.
*****3 Day Cycle has a 91% probability of fulfilling Positive Cycle Statistics covering 12 years of recorded tracking history.
PVA High Edge = 4457 PVA Low Edge = 4397 Prior POC = 4450
Range Projections and Key Levels (ES) June 2022 (M) Contract
HOD ATR Range Projection: 4542; LOD ATR Range Projection: 4363; 3 Day Central Pivot: 4415; 3 Day Cycle Target: 4452; 10 Day Average True Range; 119; VIX: 23
Nasdaq 100 (NQ)
Today is Cycle Day 1 (CD1)…Average Decline for CD1 measures 13918 for this cycle day. Prior range was 283 handles on 580k contracts exchanged. As such, there are two estimated scenarios to consider for today’s trading.
Bull Scenario: IF Bulls sustain a bid above 14350, THEN initial upside estimate targets 14414 – 14448 zone.
Bear Scenario: IF Bears sustain an offer below 14350, THEN initial downside estimate targets 14315– 14300 zone.
PVA High Edge = 14414 PVA Low Edge = 14270 Prior POC = 14315
Range Projections and Key Levels (NQ) June 2022 (M) Contract
HOD ATR Range Projection: 14772; LOD ATR Range Projection: 13969; 3 Day Central Pivot: 14206; 3 Day Cycle Target: 14793; 10 Day Average True Range: 479; VIX: 23
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.
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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