Trade Strategy 4.6.22

Markets

Treasury turbulence

Investors have been hit with an early surprise before the release of today’s FOMC minutes, which were supposed to give some clues about a reduction of the central bank’s $9T balance sheet following a quarter-point rate hike in March. The clues are no longer needed. Fed Vice Chair Lael Brainard pre-empted the minutes on Tuesday by saying a “rapid” reduction could happen as soon as May, calling the move “of paramount importance” to bring down inflationary forces, while the Fed is “prepared to take stronger action if indicators show such action is warranted.”

30-year fix above 5%

The average rate on the 30-year fixed mortgage just crossed 5%, marking the first time it has passed the threshold since 2011

Source: SeekingAlpha.com

Economic Calendar

9:30 Fed’s Harker: Economic Outlook
2:00 PM FOMC Minutes

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

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

10:30 EIA Petroleum Inventories

U.S. crude stockpiles unexpectedly rose last week at a time when traders are weighing up the impact on demand following a resurgence of Covid-19 in China against fears of tighter supplies as Europe mulls an embargo on Russia oil. 

U.S. crude inventories rose by 1.1 million barrels for the week ended March. 31. That compared with a draw of 3.0 million barrels reported by the API for the previous week. Economists were expecting a decline of about 1.6 million barrels.

The official government inventory report due Wednesday is expected to show weekly U.S. crude supplies fell by about 2.1 million barrels last week.

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 2 (CD2): There was no mistake what the “BIG BOYZ” wanted to do today. It was a “game-on” sell during the opening salvo as negative Fed Speak by Brainard was the catalyst. Outside Reversal Day marked the Candlestick. Range was 81 handles on 1.269M contracts exchanged. 

 …Transition from Cycle Day 2 to Cycle Day 3

This leads us into Cycle Day 3 (CD3): Price broke the CD1 Low (4527.75) during prior as bulls will need to recover this level during today’s RTH Session to avert a consecutive failed 3 Day Cycle. Historical odds favor this outcome, though sentiment shift has taken a negative turn. As such, estimated scenarios to consider for today’s trading.

Bull Scenario: Price sustains bid above 4505, initially targets 4530 – 4535 zone. 

Bear Scenario: Price sustains offer below 4505, initially targets 4492 – 4484 zone.

*****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 3 (CD3)

PVA High Edge = 4578       PVA Low Edge = 4535        Prior POC = 4554

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

HOD  ATR Range Projection: 4540; LOD ATR Range Projection: 4464; 3 Day Central Pivot: 4545; 3 Day Cycle Target: 4527; 10 Day Average True Range  64; VIX: 23

Nasdaq 100 (NQ)

Today is Cycle Day 3 (CD3)…Price is breaking down below CD1 Low (14801). Momentum is accelerating to the downside as price has already fulfilled downside statistical cycle target (14590). It’s appearing more that a consecutive failed cycle is on tap, which reinforces increased bearish sentiment. . As such, there are two estimated scenarios to consider for today’s trading.

Bull Scenario: IF Bulls sustains bid above 14800, THEN initial upside estimate targets 14850 – 14895 zone.

Bear Scenario: IF Bears sustains offer below 14800, THEN initial downside estimate targets 14647 – 14590 zone.

PVA High Edge = 14986       PVA Low Edge = 14809     Prior POC = 14893

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

HOD  ATR Range Projection: 14891; LOD ATR Range Projection: 14552; 3 Day Central Pivot: 14894; 3 Day Cycle Target: 14801; 10 Day Average True Range: 310; 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.

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


Leave a Reply