Next week’s major market ranges from Trevor Smith.
The S&P 500 has bear candlestick signals at present for short-term trades from today into next week. Market internals for the indices are contradictory. Therefore, I contend that both are forthcoming in the S&P and, possibly in crude oil.
Gold may follow the other symbols but with softer down moves due to bullish seasonality and worldwide cultural/religious purchase patterns. India’s Festival of Lights is traditionally known as Diwali Day that commences a four-day celebration, usually coinciding with gold purchases. Another seasonal event that may affect gold prices is Sunday’s New Moon that could easily spark selling. Lower gold prices might attract more Eastern buyers already in buying mode.
In this closing week, four of five underlying symbols, relative to Friday afternoon prices exceeded our option spread strike prices in the winning directions. Crude oil did print the noted outlier event price of $56.11, proceeding a little beyond it. Only six of 10 projected weekly ranges printed as of late Thursday night, with many being very close and reversal zones.
Next Week’s Predicted Ranges
E-mini S&P 500
High Range: 3029-3017; Low Range 2986-2972 (outlier event= 3055 Sept. Monthly Camarilla resistance)
Buy 3000/2995 Weekly put spreads; Rationale: projected range midpoint is below current price and bear candlestick daily chart in ES, $ADD; Note: $TRIN rally signal- aggressive traders can buy call spread overhead also
Japanese Yen
High Range 9280-9260; Low Range 9215-9190
Sell 9250/9225 put spread. Rationale: Volatility, Bullish three-day chart, breakout engulfing weekly pivots
Euro FX
High Range 1.120-1.115; Low Range 1.111-1.108
Buy 1115/1113 put spread. Rationale: sell signal daily chart
Gold
High Range $1531-$1521; Low Range $1508-$1500
Sell $1520/1515 weekly put spreads into $1,521 weekly high range and/or sell call spreads on highs. Avoiding Gold trades due to GLD gap up out-of-range in bullish conditions with bear technical another strategy.
Crude Oil
High Range $58.21-$57.20; Low Range $54.70-$53.83
Sell $5600/5650 call spread. Rationale: $5500 is range midpoint next week near 50-day moving average and well under current price in bear technical conditions with UCO gap downside fill potential.
(Note: This article is published on Fridays and focuses on weekly options expiring the following Friday but may include monthly options or two-week calendar/diagonal option spreads at times.)
Last Week’s Projected Ranges Versus Actuals as of Thursday 11:45 p.m.
E-mini S&P 500
3024-3009—2973-2952 (outlier event= 3055 Sept. Monthly Camarilla resistance)
Actual:3015-2982
Buy 2990/2985 Weekly put spreads; Rationale: projected range midpoint is below current price and above confluence of moving averages/pivots/Bollinger Band midlines.
Japanese Yen
High Range 9308-9275; Low Range 9217-9174
Actual:9268-9222
Sell 9275/9250 put spread. Rationale: Volatility, range midpoint is closer to lows than highs
Euro FX
High Range 1.123-1.120 Low Range 1.111-1.108
Actual:1122-1113
Buy 1117/1115 put spread. Rationale: Lower weekly pivot zones than current price, volatility, daily chart overbought oscillators
Gold
High Range $1519-$1509; Low Range -$1487-$1480
Actual: $1524-$1484
Sell $1495/1500 weekly put spreads on pullbacks. Rationale: Range midpoint is over current price, narrow-range pivots breakout setup; it is on weekly-chart support levels.
Crude Oil
High Range $5550-$5514; Low Range $5304-$5240 ($5611 outlier event, multiple timeframe moving average cluster)
Actual: $5651-$5285
Sell $5400/5350 put spread. Rationale: $5400 is range midpoint next week. If breakout direction is lower, false move higher likely
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.
