The market selloff (or bubble) is showing no sign of abating (or deflating) as U.S. stock index futures continue to stumble. Contracts linked to the Dow (DJI) and S&P 500 (SP500) fell another 1.6% overnight, while the Nasdaq (COMP.IND) slid an additional 2%. Worries are particularly intensifying with the S&P 500 benchmark index on the brink of a bear market, down more than 18% from the all-time high reached last November.
What is the CNN Business Fear & Greed Index?
The Fear & Greed Index is a way to gauge stock market movements and whether stocks are fairly priced. The theory is based on the logic that excessive fear tends to drive down share prices, and too much greed tends to have the opposite effect.
8:30 Initial Jobless Claims
8:30 Philly Fed Business Outlook
10:00 Fed’s Barr Speech
10:00 Existing Home Sales
10:00 E-Commerce Retail Sales
10:00 Leading Indicators
10:30 EIA Natural Gas Inventory
4:00 PM Fed’s Kashkari Speech
4:30 PM Fed Balance Sheet
***New: PTG Trading Room Chat Log’s Link
Prior Session was Cycle Day 2 (CD2): Persistent but “controlled” selling permeated the markets in prior session. Range was a whopping 190 handles on 2.102M contracts exchanged.
…Transition from Cycle Day 2 to Cycle Day 3
This leads us into Cycle Day 3 (CD3): Markets are trading below prior low (3906) during overnight action, as potential is high for a “failed” 3 Day Cycle. Bulls have a considerable uphill battle to recover BDL (4000). As such, estimated scenarios to consider for today’s trading.
Bull Scenario: Price sustains bid above 3905, initially targets 3935 – 3950 zone.
Bear Scenario: Price sustains offer below 3905, initially targets 3865 – 3855 zone.
PVA High Edge = 4003 PVA Low Edge = 3906 Prior POC = 3924
Range Projections and Key Levels (ES) June 2022 (M) Contract
HOD ATR Range Projection: 3981; LOD ATR Range Projection: 3807; 3 Day Central Pivot: 4014; 3 Day Cycle Target: 4000; 10 Day Average True Range 125; VIX: 32
Nasdaq 100 (NQ)
Today is Cycle Day 3 (CD3)…NAZ declined during prior session and has extended the selling during overnight activity. Odds increasingly favor a “failed” 3 Day Cycle, as bulls have an uphill battle to recover BDL (12234). As such, there are two estimated scenarios to consider for today’s trading.
Bull Scenario: IF Bulls sustains bid above 11870, THEN initial upside estimate targets 11945 – 12000 zone.
Bear Scenario: IF Bears sustains offer below 11870, THEN initial downside estimate targets 11748 – 11720 zone.
PVA High Edge = 12308 PVA Low Edge = 11870 Prior POC = 11944
Range Projections and Key Levels (NQ) June 2022 (M) Contract
HOD ATR Range Projection: 12228; LOD ATR Range Projection: 11429; 3 Day Central Pivot: 12295; 3 Day Cycle Target: 12234; 10 Day Average True Range: 524; VIX: 32
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!
“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