A Look at the Structures on Futures

Since we’ve gotten a poor reaction to the CPI data, let’s review some of the structures we can see on futures.

(This is a worst-case scenario, if we don’t get a reversal sooner, and we might.)

We have this down channel (in red) and we’re in this large falling broadening pattern (in green). We have the COVID high below, and we can use the H&S pattern we’re in to develop an additional target that yields us the orange box:


Zoomed in a bit it looks like this:


We may not go there in a straight line, if we go there at all. It’s also possible for us to bottom sooner. My intentions on the open are to roll down my put hedges (which, if we open here, will now be ITM) for a sizable net credit. And I will keep my longs because they still have enough time that I may be able to average them down and catch a strong bounce somewhere between here and the orange box.

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