Polaris Trading Group: Taylor 3 Day Cycle Commentary Author: David D Dube (PTGDavid)
***Written 8 pm Tuesday evening for Wednesday’s trading
Tuesday’s Session was Cycle Day 3 (CD3): Similar action to previous cycle in that price was well below CD1 Low at beginning of session, and rallied throughout to reclaim 3461.25, securing a Positive 3 Day Cycle Statistic. It’s important to note the odds (91%) favor a positive cycle by the end of CD3. Range was 51 handles on 1.682M contracts exchanged.
…Transition from Cycle Day 3 to Cycle Day 1
This leads us into Cycle Day 1 (CD1): Majority of this cycle’s decline from CD3 High (3469.75) down to CD1 Average Decline (3415) is in-place. As such, there are two scenarios to consider for today’s trading.
1.) Price sustains a bid above 3435, initially targets 3455 – 3470 zone.
2.) Price sustains an offer below 3435, initially targets 3425 – 3415 zone.
For more detailed information for both bullish and bearish projected targets, please visit: PTG 3 Day Cycle and/or reference the Cycle Spreadsheet below:
Link to access full Cycle Spreadsheet >> Cycle Day 1 (CD1)
Thanks for reading,
Polaris Trading Group
In the Tradechat Room
The MOC at 15:50 was about 1Billion to sell. The candle has some selling, but the 15:05 drop took the icing from the cake and didn’t leave much more.
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Chart of the Day
|(ESH20:CME) GLOBEX Session||(ESH20:CME) Day Session|
|High 3451.75||Opening Print: 3435.00|
|Low: 3426.75||High 3469.75|
|Volume: 210,000||Low: 3426.75|
|ES Settlement 3431.25|
|Total Volume 1.66 M|
S&P 500 RECAP – Trade Date 10/20/ 202
S&P 500 Futures: Two Weeks From Election Day
After a 25.00 handle sideways overnight range, the S&P 500 futures opened Tuesday’s cash session at 3435.00, up 11.75 handles, traded to an early morning low of 3430.50 and then rallied up to 3453.75 for the early morning high. From there, the ES pulled back to a midmorning low of 3426.75 at 10:15 CT before bouncing the rest of the morning into the noon hour, reaching a daily high of 3469.75 just after 12:30.
The afternoon turned lower as the S&Ps would sell off gradually in the early afternoon before falling on heavy momentum in the final hour down to 3427.25, then rallied 22.00 handles in short order to 3449.25 before declining noticeably into the settlement, printing a daily low of 3426.75 before settling at 3431.25 up 8.50 handles or +0.25% on 1.66 million volume.
In terms of price action, the morning was about buying the dips and the afternoon was for selling the rips.
Election And Stimulus Grind Goes On
Trading the ES and NQ have reached the outer limits of the pain game. In my view, it has gone from ugly to uglier. Yesterday’s price action was a perfect example of what I started talking about two weeks ago, increased volatility. The index markets are moving from one extreme to the other and risk has gone up significantly. Simple 1 and 2 lot NQ trades can make or lose thousands of dollars. Recently the average RTH ES 5-day trading range slipped down to only 35.50 handles a day and as of yesterday’s close, it has expanded to 54.20 handles. This is not going to stop. Our view, I still think the government is going to come to a stimulus deal but that is going to remove the increased risk. Our lean is we can not rule out selling the pop but we are looking to buy the pullbacks keeping in mind the size of the average 5-day trading range.
Market Vitals Technical Analysis
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As always, please use protective buy and sell stops when trading futures and options.
Disclaimer: Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involves substantial risk of loss and is not suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge, and financial resources. Decisions to purchase or sell as a result of the opinions expressed in the forum will be the full responsibility of the person(s) authorizing such transaction(s). BE ADVISED TO ALWAYS USE PROTECTIVE STOP LOSSES AND ALLOW FOR SLIPPAGE TO MANAGE YOUR TRADE(S) AS AN INVESTOR COULD LOSE ALL OR MORE THAN THEIR INITIAL INVESTMENT. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS.