The end of a four-week winning streak is flustering some market participants as stock index futures remain in the red this morning (see movement below). While the S&P 500 has climbed 15% since its low at the beginning of the summer, it is still 11% lower over the course of 2022. The sentiment is causing fewer investors to call a complete market bottom, though there are still plenty of believers that feel the latest setback will prove to be more of a speed bump than serious turbulence.
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Prior Session was Cycle Day 3 (CD3): Positive 3-Day Cycle, though it was a weak finish for the cycle and week. Range was 67 handles on 1.625M contracts exchanged.
…Transition from Cycle Day 3 to Cycle Day 1
This leads us into Cycle Day 1 (CD1): Average Decline for CD1 measures 4209 which is in-place, as price decline of nearly 1% is unfolding to begin the new week. OPEX this past Friday has left the market vulnerable to downside volatility and direction. As such, estimated scenarios to consider for today’s trading.
Bull Scenario: Price sustains a bid above 4200, initially targets 4215 – 4220 zone.
Bear Scenario: Price sustains an offer below 4200, initially targets 4180 – 4175 zone.
PVA High Edge = 4244 PVA Low Edge = 4228 Prior POC = 4230
Range Projections and Key Levels (ES) Sept 2022 (U) Contract
Nasdaq 100 (NQ)
Today is Cycle Day 1 (CD1)…Today is CD1 with Average Decline measuring 13223 which is in-place, as price is currently lower by 1.50% during overnight trade activity. We’ll mark 13100 as Key Line-in-Sand for over/under. As such, there are two estimated scenarios to consider for today’s trading.
Bull Scenario: IF Bulls sustains bid above 13100, THEN initial upside estimate targets 13160 – 13175 zone.
Bear Scenario: IF Bears sustains offer below 13100, THEN initial downside estimate targets 13065 – 13038 zone.
PVA High Edge = 13318 PVA Low Edge = 13246 Prior POC = 13265
Range Projections and Key Levels (NQ) Sept 2022 (U) Contract
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