- The MKT has a slight negative bias in a difficult
"choppy" trade. On the SELL side DP BREAKOUT strategies are valid but
should expect a laborious trade. UP and
UT1 FADE and REVERSAL strategies are recommended but profit should be taken at
initial targets. The probability is to the downside today but is not a day to
press it.
- On the BUY side avoid UP BREAKOUT strategies but rather
FADE a negative reaction after a positive breakout signal at the DIR. DP
REVERSAL strategies are recommended over FADE strategies as "sloppy"
trading conditions are expected. Any DP FADE trades should get confirmation
before executing. Position management adjustments should be anticipated for all
longs as sideways trading conditions can quickly erase profits.
-Today, the DOW JONES FUTURES INDEX was in a "Neutral Digestion" state and our expectation is for a sideways trading day. With an MC Value of -1 and the R Level at the UT1, there is a negative bias to today's price map. The DF had an early rally that broke out of the Critical Range around 6:30 A.M. This move signaled to the trader that a new digestive range was being established. Since the R Level was placed at the UT1, the analyst is telling the trader that the market has the potential to breakout of the critical range, but the probability favors a failure to surpass the UT1. As it played out, the market did indeed fail from the R Level, and presented the trader with the highest probability trade of the day, a "Sell R Fade". From here the market began to retrace its progress, giving the trader an opportunity to realize profits at the UP around 10 A.M. The market again failed from the R Level around 2 P.M. which would have provided the trader with another opportunity to Sell the R Level for a profitable trade.
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