Trade Strategy 4.27.22

Markets

Wall Of Worry

Some traders are attempting a brave climb up the “wall of worry” despite a multitude of negative forces that continue to spook the market. Overnight, U.S. stock index futures rose by 1% despite aggressive selling on Wall Street in the previous session, which saw the Nasdaq plunge nearly 4% and the Dow slide by more than 800 points.

Source: SeekingAlpha.com

Economic Calendar

8:30 International Trade in Goods (Advance)
8:30 Retail Inventories (Advance)
8:30 Wholesale Inventories (Advance)
10:00 Pending Home Sales
10:00 State Street Investor Confidence Index
11:00 Survey of Business Uncertainty
11:30 Results of $24B, 2-Year FRN Auction
1:00 PM Results of $49B, 7-Year Note Auction

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

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

10:30 EIA Petroleum Inventories

Oil was up on Wednesday morning in Asia. Investors digested Russian threats of gas supply cuts to Poland and Bulgaria, while hopes that China will roll out more economic stimuli supported the oil demand outlook.

Meanwhile, Tuesday’s U.S. crude oil supply data from the American Petroleum Institute showed a build of 4.780 million barrels for the week ended Apr. 21. Forecasts prepared by Investing.com predicted a build of 2.167 million barrels, while a 4.496-million-barrel draw was recorded during the previous week.

Investors now await crude oil supply data from the U.S. Energy Information Administration, due later in the day.

Source: http://Investing.com

S&P 500

***Written Tuesday evening for Wednesday’s trading for contribution to MrTopStep’s “The Opening Print” publication.

Prior Session was Cycle Day 1 (CD1): Selling spilled over into this CD1 day as decline exceeded the average, as implied volatility (IV) remains elevated. Prior range was 167 handles on 1.954M contracts exchanged. 

 …Transition from Cycle Day 1 to Cycle Day 2

This leads us into Cycle Day 2 (CD2): Normal for a Cycle Day 2 is for some ‘back n fill’ consolidation activity to balance previous selling. CD1 Low is marked at 4136.75, with price rallying higher overnight back to 5-day POC (4215). As such, estimated scenarios to consider for today’s trading.

Bull Scenario: Price sustains a bid above 4215, initially targets 4232 – 4240 zone. 

Bear Scenario: Price sustains an offer below 4215, initially targets 4196 – 4180 zone.

PVA High Edge = 4232       PVA Low Edge = 4170         Prior POC = 4212

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

For more detailed information for both bullish and bearish projected targets, please visit: PTG 3 Day Cycle and/or reference the Cycle Spreadsheet below:

Link to access full Cycle Spreadsheet  > > Cycle Day 2 (CD2)

Range Projections and Key Levels (ES) June 2022 (M) Contract

HOD  ATR Range Projection: 4246; LOD ATR Range Projection: 4120; 3 Day Central Pivot: 4251; 3 Day Cycle Target: 4259; 10 Day Average True Range  97; VIX: 30

Nasdaq 100 (NQ)

Today is Cycle Day 2 (CD2)…Following another wide range sell-down, price has recovered approximately one-half of prior decline. Normal for CD2 is for consolidation/stabilization albeit with elevated implied volatility (IV). Markets can certainly use an IV (intravenous drip) to help calm down current negative sentiment. As such, there are two estimated scenarios to consider for today’s trading.

Bull Scenario: IF Bulls sustains bid above 13122, THEN initial upside estimate targets 13196 – 13262 zone.

Bear Scenario: IF Bears sustains offer below 13122, THEN initial downside estimate targets 13065 – 12960 zone.

PVA High Edge = 13265       PVA Low Edge = 13012     Prior POC = 13122

Range Projections and Key Levels (NQ) June 2022 (M) Contract

HOD  ATR Range Projection: 13322; LOD ATR Range Projection: 12739; 3 Day Central Pivot: 13317; 3 Day Cycle Target: 13364; 10 Day Average True Range:96; VIX: 30

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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