Trade Strategy 4.12.16

Markets

Just five days ahead of the much anticipated oil producers’ meeting in Doha, Iraq’s OPEC governor Falah Alamri has extended his support for an output freeze agreement by stating “this is the only way” to boost crude prices. Although at least 15 major oil producers (that account for 75% of the world’s oil production) are scheduled to attend the summit this weekend, several sticking points remain, including Iran and Saudi Arabia’s participation and the level at which production should be frozen. The optimism boosted Brent crude futures to a 2016 high of $43.53/bbl overnight, while WTI gained $0.39 to $40.75 a barrel.

In Asia, Japan +1.1% to 15929. Hong Kong +0.3% to 20504. China -0.3% to 3024. India +0.5% to 25146.
In Europe, at midday, London flat. Paris +0.2%. Frankfurt +0.4%.
Futures at 6:20, Dow +0.2%. S&P +0.3%. Nasdaq +0.3%. Crude +0.9% to $40.75. Gold +0.1% to $1258.70.
Ten-year Treasury Yield +3 bps to 1.76%

(Source: Seeking Alpha)

Today’s Economic Calendar
6:00 NFIB Small Business Optimism Index
8:30 Import/Export Prices
8:55 Redbook Chain Store Sales
9:00 Fed’s Harper: Economic Outlook
1:00 PM Results of $24B, 3-Year Note Auction
2:00 PM Treasury Budget
3:00 PM Fed’s Williams: Monetary Policy
4:00 PM Fed’s Lacker speech
PTG Trading

Price tested the Cycle Day 3 High in prior session and failed to hold bid, setting up a reversal, progressively selling until price reached 2033.62, which was Cycle Day 1 projected Average Cycle Decline. All-in-All…Textbook Cycle Day 1 trade session.

Today is Cycle Day 2 (CD2)…NEUTRAL SPILL UP…Having reached Cycle Average Decline (2033.62)…expected trade today is to absorb any additional selling above CD1 Low (2032.50). Once Mr. Market is confident of “secure low”, then the rally can begin in earnest. Price will need to stabilize and hold bid above 2041.25 for the rally to unfold.

Range Projections and Key Levels: June (M) Contract

HOD Range Projection = 2051.77; LOD Range Projection = 2020.48; CD2 Maximum Penetration Level = 2069.13; CD2 Maximum Violation Level = 2014.89; Cycle Day 1 Low = 2032.50; 3 Day Central Pivot = 2041.25; 3 Day Cycle Target = 2064.14; 10 Day Average True Range = 22.52.

**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: June (M) 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 holds above PL (2032.50) THEN 1st objective is to clear and convert 2041.25 3 Day Central Pivot. IF this occurs, THEN upside objective measures 2051.77. Above this level range expansion can occur targeting 2055.50, with extremes 2064.14.

Scenario 2: Failure to convert 2041.25 and subsequent violation of PL (2032.50) opens trap door initially targeting 2028.75 – 2026.00 STATX Zone. Below this zone measures 2020.48 down to 2014.89 CD2 Maximum Violation Level.

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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