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Trading Coach - Actionable Market Levels - March 21 2019


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Actionable Levels:

Market

Trend

Range Low

Range High

SP500

Neutral

2760

2849

VIX (Cash)

Neutral

12.53

18.05

OIL

Bullish

56.45

60.80

GOLD

Bullish

1283

1320

10YR (Yield)

Bearish

2.49

2.65

Powell delivered that sly dog..I didnt think he would

-0 rate hikes for the remainder of the year (which we said was the most probable scenario going back to last Sept.)

-1 rate hike showing in 2020

-downgraded GDP to 2.1% from 2.3%

-Balance sheet run-off pauses in September

-Powell acknowledged global growth slowing

**Dovish

Market Reaction: the USD got smacked lower Gold recovered Bond Yields hitting YTD lows Equities flat but a rollercoaster ride with a 33pt range in the SP500

Note: Now its Draghis turn April 10thto double down on his dovish rhetoric setting up for sell on the Euro?

Full Statement-

FOMC full statement for March 2019

Information received since the Federal Open Market Committee met in January indicates that the labor market remains strong but that growth of economic activity has slowed from its solid rate in the fourth quarter. Payroll employment was little changed in February, but job gains have been solid, on average, in recent months, and the unemployment rate has remained low. Recent indicators point to slower growth of household spending and business fixed investment in the first quarter. On a 12-month basis, overall inflation has declined, largely as a result of lower energy prices; inflation for items other than food and energy remains near 2 percent. On balance, market-based measures of inflation compensation have remained low in recent months, and survey-based measures of longer-term inflation expectations are little changed.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. In support of these goals, the Committee decided to maintain the target range for the federal funds rate at 2-1/4 to 2-1/2 percent. The Committee continues to view sustained expansion of economic activity, strong labor market conditions, and inflation near the Committee's symmetric 2 percent objective as the most likely outcomes. In light of global economic and financial developments and muted inflation pressures, the Committee will be patient as it determines what future adjustments to the target range for the federal funds rate may be appropriate to support these outcomes.

In determining the timing and size of future adjustments to the target range for the federal funds rate, the Committee will assess realized and expected economic conditions relative to its maximum employment objective and its symmetric 2 percent inflation objective. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments.

Voting for the FOMC monetary policy action were: Jerome H. Powell, Chairman; John C. Williams, Vice Chairman; Michelle W. Bowman; Lael Brainard; James Bullard; Richard H. Clarida; Charles L. Evans; Esther L. George; Randal K. Quarles; and Eric S. Rosengren.

Sign up for our Daily Fundamental Market Insights and Emailed Trade Recommendations by selecting the Link Below:

https://rjofutures.rjobrien.com/trading-offers/trading-coach-insights/?cid=70144000001J1zYAAS

Trade with the trend are words commonly echoed by professional traders. At what price does one sell in a bearish trending market and at what price does one buy in a bullish trending market? The Market Navigator is intended to provide guide posts to identify those price levels.

How to use our strategy:

Guidelines

The rules based strategy is simple.

If a market is in aBullishtrend a trader should only be looking to participate as abuyerand only at thelowend of the range.

If a market is in aBearishtrend a trader should only be looking to participate as asellerand only at thehighend of the range.

If a market is in aNeutraltrend a trader should be looking to participate as abuyeronly at thelowend of the range OR as aselleronly at thehighend of the range.

Trend

Determining how a market is currently trending depends on the time line. I typically track markets on both a monthly and weekly timeframe to identify trend bias. In my experience, studying market price, action, and behavior, Ive observed that markets that trend bullish or bearish on a 3-month timeline tend to hold that posture for an extended period of time.

With this in mind, all markets have the tendency to revert back to the mean, whether bullish or bearish trend. In other words, you get bull market dips that create buying opportunities, and bear market rips that create selling opportunities.

Range

Trading ranges are determined by an ongoing tug of war on price levels between buyers and sellers. The top end of a range is typically where buying pressure has run out of steam and the number of sellers overwhelms the market and pushes it lower. Conversely, the bottom end of a range is typically where selling pressure has run out of steam and the number of buyers overwhelms the market and pushes it higher.

Range trading with the trend enables one to participate in a market with predefined entry target levels while keeping the overall bias in sync with the market trend. My proprietary trading range levels can be viewed as support and resistance levels, however unlike traditional static support and resistance, my levels update on the open and close of the market and may be different each period depending on market volatility. The levels factor in both the medium term and near term price action.

Use these levels to help manage market swings and risk. Remember, the amount of risk that you accept is the only aspect of the market you control.Sign up for a free 2 week demo of ourRJOF PRO Trading Platformand John Caruso will include you on his daily email distribution during the trial period.

This material has been prepared by a sales or trading employee or agent of R.J. OBrien & Associates, LLC and is, or is in the nature of, a solicitation. This material is not a research report prepared by R.J. OBrien & Associates, LLC Research Department. By accepting this communication, you agree that you are an experienced user of the futures markets, capable of making independent trading decisions, and agree that you are not, and will not, rely solely on this communication in making trading decisions. DISTRIBUTION IN SOME JURISDICTIONS MAY BE PROHIBITEDOR RESTRICTED BY LAW. PERSONS IN POSSESSION OF THIS COMMUNICATION INDIRECTLY SHOULD INFORM THEMSELVES ABOUT AND OBSERVE ANY SUCH PROHIBITION OR RESTRICTIONS. TO THE EXTENT THAT YOU HAVE RECEIVED THIS COMMUNICATION INDIRECTLY AND SOLICITATIONS ARE PROHIBITED IN YOUR JURISDICTION WITH REGISTRATION, THE MARKET COMMENTARY IN THIS COMMUNICATION SHOULD NOT BE CONSIDERED A SOLICITATION. The risk of trading futures and options can be substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results. Trading advice is based on information taken from trades and statistical services and other sources that R.J. OBrien & Associates, LLC believes to be reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgement at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitabl



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About the author


John began his career 15 yrs ago at Wilshire Quinn Capital, a Wealth Management Firm based out of Los Angeles, California. John first began to interpret different market strategies and ideas as an individual investor at the tail end of his college years. By 2004 he was opperating one of the largest retail books at Wilshire Quinn Capital.  In 2006 John moved to Chicago based Lind-Waldock where he began to expand his knowledge and hone his trading skills in the futures industry. He joined RJO Futures in 2011.

John's focus is to identify and service the needs of each and every one of his clients and suggest investments based on those needs.  John has a very unique way of interpreting markets, focusing on broader economic trends based on growth and inflation metrics.  His technical study is also unique, which combines a proprietary market range calculation and charting trends across multiple durations.  

Contact Info:

John Caruso

Senior Market Strategist

jcaruso@rjofutures.com

312-373-5286

Twitter: @JCarusoRJO

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