Trade Strategy 7.28.23

Markets (Top Stories)

Doing just fine

The U.S. economy is showing further resilience as GDP grew at a 2.4% annualized rate in Q2, almost a full percentage point stronger than the 1.5% expected. The growth was driven by robust consumer and business spending, while durable goods orders separately showed the fourth straight month of growth. A soft landing may be turning into the base case for strategists, but for those looking to hedge stock longs, BofA explains why it’s never been cheaper to buy protection.

Source: SeekingAlpha.com

Economic Calendar

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

S&P 500

Prior Session was Cycle Day 1 (CD1):  Normal CD1 as price declined, establishing a new cycle low at 4553. Prior range was 80 handles on 1.828M contracts exchanged. 

 …Transition from Cycle Day 1 to Cycle Day 2

This leads us into Cycle Day 2 (CD2): Price has retraced approximately one-third of prior session’s afternoon decline, back to 5 day POC (4585). We’ll be anticipating a more normal CD2 “two-way” trade with plenty of upside/downside range to traverse to end the last week of July. As such, scenarios to consider for today’s trading.

Bull Scenario: Price sustains a bid above 4585, initially targets 4600 – 4605 zone. 

Bear Scenario: Price sustains an offer below 4585, initially targets 4565 – 4560 zone.

PVA High Edge = 4633       PVA Low Edge = 4586         Prior POC = 4619

Range Projections and Key Levels (ES) Sept 2023 (U) Contract

HOD  ATR Range Projection: 4597; LOD ATR Range Projection: 4549; 3 Day Central Pivot: 4592; 3 Day Cycle Target: 4614; 10 Day Average True Range  39; VIX: 13

Nasdaq 100 (NQ)

Prior Session was Cycle Day 1 (CD1):  Normal CD1 as price declined, establishing a new cycle low at 15511. Prior range was 392 handles on 829k contracts exchanged. 

 …Transition from Cycle Day 1 to Cycle Day 2

This leads us into Cycle Day 2 (CD2): Price has retraced approximately one-half of prior session’s afternoon decline, so we’ll mark 15715 at today’s Line-in-sand (LIS). We’ll also be anticipating a more normal CD2 “two-way” trade with plenty of upside/downside range to traverse to end the last week of July. As such, scenarios to consider for today’s trading.

Bull Scenario: Price sustains a bid above 15715, initially targets 15785 – 15810 zone. 

Bear Scenario: Price sustains an offer below 15715, initially targets 15625 – 15620 zone.

PVA High Edge = 15895       PVA Low Edge = 15709     Prior POC = 15832

Range Projections and Key Levels (NQ) Sept 2023 (U) Contract

HOD  ATR Range Projection: 15787; LOD ATR Range Projection: 15475; 3 Day Central Pivot: 15654; 3 Day Cycle Target: 15807; 10 Day Average True Range: 241; VIX: 13

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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