Next week’s major market ranges based on Trevor Smith’s mathematical based analysis.
Because the markets in this closing week rapidly discovered new valuations, human participants may need time to accept and plan around some of those new trading-price levels, which could lead to some sideways confusion in price action for the coming week.
In other instances, trade signals are simply passing through to higher time frames into the domains of slower-moving traders, which is why some bullish signals are now on three-day and Weekly charts. Examples of intraday trade signals that are progressing into these charts are the Japanese yen (bearish continuation), the euro (bullish continuation), and gold (bearish tests likely to continue).
Slower trades need more time to mature or cook. Traders may consider monthly-expiring options, thereby allowing 3-4 subsequent candlesticks beyond the trade signal bars to fully develop and time decay in short options to give profitability.
Another slow trade mentioned in prior articles is the “Crazy Crude” range breakout building with bullish candlesticks in the upper 25% of the range box but sideways on the week.
A breakout exception candidate is the euro with trending weekly math and inside ranges, but it still has mixed tails on tops/bottoms of candles and the monthly option spread is there to catch surprise profits.
Last week, all option spread trades worked and markets hit 8/10 projected range extrema. While predicted bear moves happened, the S&P’s drop was not as deep as technical divergence suggests in this continued invalid rally to retest highs- amidst collapsing market internals. A 120-point drop to the unfulfilled 2870 target may happen, although sideways pivot math opposes this breakout.
Next Week’s Predicted Ranges
E-mini S&P 500
High Range 3030-3006; Low Range 2925-2910 (outlier event=2870)
Buy 2995/2990 put spread Sept. 13 weekly expiration; Rationale: $ADVN dropped again today; range midpoint, weekly pivot are 2955 below
Japanese Yen
High Range 9435-9400; Low Range 9324-9294
Buy 9300/9350 call spread weeklies; Buy 9400/9350 put spread monthly expiration. Rationale: 9350 weekly pivot, 9370 range midpoint weekly targets; 9305 Weekly 20-moving average lower slow target
Euro FX
High Range 1.116-1.111; Low Range 1.100-1.095
Buy 1.105/1.10 weekly put spread; Buy 1.10/1.105 Monthly call spread; Rationale: Sell/Buy tails on intraweek candles, so midpoint of range below likely; bull signals higher time frames need low entry
Gold
High Range $1550-$1535; Low Range $1500-$1481
Sell call spreads weekly/monthly $1530/$1525 (adjust monthly strikes with broker if needed to find where to collect premium); Rationale: weekly chart inverted hammers, 3-day chart
Crude Oil
High Range $5850-$5740; Low Range $5490-$5410
Buy weekly put spreads near 5650/5700 during Sept. 6 rally up inverted hammer candle’s green tail;(5625 is range midpoint below); For larger range breakout overhead buy $60/61.50 call spread monthly November expiration as example of upside breakout trade (if breaks upside) or use long calendar, diagonal spreads
Last Week’s Projected Ranges Versus Actuals as of Sep. 5.
E-mini S&P 500
High Range 2981-2967; Low Range 2905-2870
Actual: 2987-2889
Buy 2930/2935 weekly put spread; aggressive traders buy same call spread for week’s highs made early, reverse position to buy put spread at weekly highs; Rationale: $ADVN, $TICK internals dropped today
Japanese Yen
High Range 9490-9460; Low Range: 9360-9281
Actual: 9466-9330
Sell weekly & monthly call spreads 9400/9425; Rationale: 3-day Chart candlesticks
Euro FX
High Range 1.106-1.100; Low Range 1.085-1.1033
Actual: 1.109-1.093
Buy 1.1/1.1025 weekly call spread; Rationale: weekly pivot above in sideways pivots
Gold
High Range $1560-$1540; Low Range $1511-$1587 (ERROR: I intended $1511-$1487)
Actual: $1566-$1514
Buy $1525/$1520 weekly & monthly put spreads
Crude Oil
High Range $5743-$5615; Low Range $5429-$5356
Actual: $5776-$5284
Buy weekly call spreads 5500/5550; Rationale: Weekly pivot/range midpoint/weekly 50-MA supports; reverse position if trending breakout lower.
See More analysis from Trevor here
Note: Nothing herein shall be construed to be specific financial advice. While reflecting my best good-faith efforts to forecast markets, no guarantees of accuracy are made from my range statistics, aggregate statistics, frequentist interpretations, and pivot math from hand calculations. I am a registered newsletter CTA, and all required disclaimers apply. Trade at your own risk with money you could discard/not miss.
