Next week’s major market ranges from Trevor Smith.
Next week’s overlapping pivots/ranges on multiple time frames create conditions that support expanded-range breakouts. This is true for stock indices, currencies, metals and energies.
Gold is the best candidates for accurate range projections because of weekly math for the coming week but with a cautionary note about weekly(bullish)-monthly(bearish) chart breakout setups to manifest anytime. As we were right about seasonal holiday effects on gold, its soft landing and reversal this week.
S&P 500 futures, having out-of-fair-value narrow ranges combined with trending math characteristics, are the best candidate for a wide-range, unidirectional price journey next week. The euro and crude oil are runners up for blowout range pricing next week.
In this closing week, five of six underlying symbols’ prices, relative to Friday morning levels when this article is written, exceeded our option spread strike prices in the winning directions. Eight of 10 projected weekly ranges printed as of late Thursday night, with gold’s $1,516 high being close to the $1,521 range minima.
The S&P 500 futures 3055 Thursday high was the exact number mentioned in my ranges as an “outlier event,” it was the September Camarilla Pivot. I latched on to that number last month after the strength of the low reversal caused me to reach wide for range-extension target levels beyond normal standard deviations.
Next Week’s Predicted Ranges
E-mini S&P 500
High Range: 3075-3060; Low Range 3014-3002
Buy 3055/3050 Weekly put spreads; Rationale: Bearish/negatively divergent McClellan Oscillator Daily chart, negative divergence weekly chart’s understudies making lower highs versus market’s higher highs; 2981 monthly floor pivot, 3045 weekly pivot
Japanese Yen
High Range 9348-9317; Low Range 9255-9234
Sell 9300/9275 call spread to scalp coming stops-run on bullish trades; reverse position to 9275/9300 short put spread weekly/monthly. Rationale: Volatility, Bullish 3-day chart, breakout engulfing weekly pivots on moving average support.
Euro FX
High Range1.124-1.119; Low Range 1.114-1.112
Buy 1120/1117 call spread. Rationale: bearish understudies; weekly/monthly pivots below 1116-12 zone
Gold
High Range $1533-$1525; Low Range $1509-$1502
Sell $1515/1510 weekly and monthly put spreads into $1525 weekly high range and sell same weekly call spreads down to $1505 weekly pivot. Rationale: weekly bull chart hammer on moving average into monthly bearish highs; weekly pivot below
Crude Oil
High Range $5661-$5592; Low Range $5410-$5343
Buy $55/5550 call spread weekly/monthly expirations. Rationale: Weekly pivot overhead currently (Fri. a.m.); monthly and weekly chart moving average supports.
(Note: This article is published mid-day on Fridays and focuses on weekly options expiring the following Friday but may include monthly options or 2-week calendar/diagonal option spreads at times.)
Last Week’s Projected Ranges Versus Actuals As of Fri., 9:45 a.m.
E-mini S&P 500
High Range: 3029-3017; Low Range 2986-2972 (outlier event= 3055 Sept. Monthly Camarilla resistance)
Actual:3062-3020 (Worst Weekly Range Projection, Best Outlier Estimate)
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
Actual: 9291-9174
Sell 9250/9225 put spread. Rationale: Volatility, Bullish 3-day chart, breakout engulfing weekly pivots
Euro FX
High Range 1.120-1.115; Low Range 1.111-1.108
Actual: 1.120-1.108 √+(Best Weekly Range Projection)
Buy 1115/1113 put spread. Rationale: sell signal daily chart
Gold
High Range $1531-$1521; Low Range $1508-$1500
Actual: $1516-$1483
Sell $1520/1515 weekly put spreads into $1521 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 $5821-$5720; Low Range $5470-$5383
Actual $5692-$5371
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.
- (Best Weekly Trade by entry timing, time decay, duration in winning direction, 1 turn, >4% move)
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.
