U.S. stock index futures rebounded 1% overnight after the S&P 500 closed down 0.8% on Tuesday – snapping a seven-day winning streak – as the tech sector weighed on the benchmark.
8:30 Consumer Price Index
10:00 Atlanta Fed’s Business Inflation Expectations
10:00 Fed’s Rosengren: “U.S. Economy and Current Economic Conditions”
10:30 EIA Petroleum Inventories
11:00 Fed’s Kaplan Speech
Inflation reading expected to be tame
Traders will examine the latest consumer price report before the opening bell. The CPI is forecast to have increased 0.3% in July, half the monthly increase seen in June, while the core CPI is expected to rise by 0.2%, or 1.2% on an annualized basis.
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Prior Session was Cycle Day 1 (CD1): Price had a relatively firm bid most of prior session until the last “hour of power”. Traders then slammed price lower in anticipation of Market on Close Sell Imbalance of $1.8 Billion. Range was 59.50 handles on 1.7M contracts traded.
…Transition from Cycle Day 1 to Cycle Day 2
This leads us into Cycle Day 2 (CD2): Price has rallied sharply back from CD1 Low (3319.50) recovering 90% of prior session’s final hour decline. In addition, CD2 average range rally objective (3351.50) has been fulfilled. We have two scenarios to consider for today’s trading.
1.) Price sustains a bid above 3350, initially targeting 3360 – 3370 zone.
2.) Price sustains an offer below 3350, initially targeting 3340 – 3330 zone.
*****3 Day Cycle has a 91% probability of fulfilling Positive Statistic covering 12 years of recorded tracking history.
PVA High Edge = 3374 PVA Low Edge = 3356 Prior POC = 3370
Range Projections and Key Levels (ES) September 2020 (U) Contract
HOD ATR Range Projection: 3363; LOD ATR Range Projection: 3323; 3 Day Central Pivot: 3343; 3 Day Cycle Target: 3351.50; 10 Day Average True Range 37; VIX: 22
Nasdaq 100 (NQ)
Today is Cycle Day 2 (CD2)…Price has recovered approximately three-quarter’s of prior session’s last hour decline. Today we have two scenarios to consider:
PVA High Edge = 11075 PVA Low Edge = 10965 Prior POC = 11000
Bull Scenario: IF Bulls sustain a bid above 10965, THEN initial upside estimate targets 11000 – 11015 zone
Bear Scenario: IF Bears sustain an offer below 10965, THEN initial downside estimate targets 10925 – 10910 zone.
Range Projections and Key Levels (NQ) September 2020 (U) Contract
HOD ATR Range Projection: 11059; LOD ATR Range Projection: 10810; 3 Day Central Pivot: 11059; 3 Day Cycle Target: 10930; 10 Day Average True Range: 180; VIX: 25
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