Thursday, January 30, 2014

3 Reasons I’m Bullish the US Markets | Day Trading Newsletter 01/30/14;

“In essence, if we want to direct our lives, we must take control of our consistent actions. It's not what we do once in a while that shapes our lives, but what we do consistently.” 

Reflections from Today:
·       We NAILED these levels for today, made great money!
·       Markets Reacting to FOMC this morning, volatility was high
·       Today’s GDP sends equities soaring higher!
·       Gold; opened < PLOD so we sold short
·       Gold moves lower -1.95% @ 1243.0
·       Crude Oil; Opened > PHOD so we got long
·       Crude Oil moves higher +.60% @ 98.08
·       Mini-Russell; Opened > PHOD so we got long
·       Mini-Russell moves higher +1.13% @ 1132.5
·       Jobless Claims came out higher @ 348k vs. 330k
·       GDP came out as-expected @ 3.2% (highest since 2010)
·       GDP:  Govt. Shutdown cost US 0.3% in Q4’ 2013
·       GDP:  Personal Consumption & Government Spending tumbled
·       Pending Home Sales lagged; blame it on the weather!
·       Friday:  Personal Income News @ 8:30am EST
·       Friday:  Consumer Confidence News @ 9:55am EST
·       Janet Yellen takes the reigns of US Fed 9:00am Feb 3rd
·       Facebook stock soars today, giving E-Mini Nasdaq a boost, advertising revenue jumps +76%
·       Happy New Year!  Solar New Year / Chinese New Year tomorrow @ Midnight

Economic News for Tomorrow:

Friday's News Schedule
8:30am EST  Personal Income | Employment Costs
9:45am EST  Chicago PMI
9:55am EST  Consumer Sentiment

Friday is the end of the month and the end of the solar New Year, and with some Red-Star news scheduled to be released early in the session we are expecting to have another exciting trading day tomorrow.

We begin with Red-Star news from Personal Income at 8:30am EST, which is exactly what we need to get the price-action moving on a Friday morning.  In addition, we will also see news from Employment Costs at the same time.

Consumer Sentiment News
Later in the session tomorrow we have Chicago PMI and then Consumer Sentiment just before 10:00am EST.  If you recall, consumer confidence on Tuesday this week was VERY strong, and last month (December) was a record-breaking number as well.  The consumers in the US are bullish and tomorrow we will see if that is likely to continue.

A Word of Caution…

Friday’s are always going to be a moving target from the moment the session begins.  People do strange things in the markets on a Friday, especially at the end of the month and the year.  We always want to finish our week in the positive and bring that momentum into next Monday, which means we are going to protect capital first tomorrow, and keep our eyes open for trading opportunities early in the session. 

Tomorrow we will trade the US session from 7am to 12pm EST, and we will not trade the afternoon unless absolutely necessary.

Day trading plan for Tomorrow:

Crude Oil:

VIP Chart: 

Crude Oil VIP Chart
Crude Oil is looking very bullish this evening on the VIP chart after we opened the session at the highs and never looked back.  The closing-print this afternoon was in the middle of the range, so there’s a chance we move lower on Friday, but I am going to wait to see what the opening-bell looks like. 

Crude Oil Anchor Chart 1

I am selling short with the opening-print below 97.66, and buying long with the opening-print above 98.59.
Anchor Chart:

The anchor chart is also very bullish on Crude Oil this evening, and we are seeing an easy window of opportunity for Crude Oil to reach the 100.00 big-round-number in tomorrow’s trading session.

Crude Oil Anchor Chart 2
We are above all the key moving-averages, higher-highs and higher-lows in price, and in a perfect location right NOW to buy this market at a discount on the way up to the big-round-number of 100.00.

I am looking to buy on a pullback to 97.46 or 96.81 and will use the 98.75 and 100.00 as my profit-targets for tomorrow.


VIP Chart:
Gold VIP Chart
Just like we said last night… if gold opens below the lows we are going to SELL OFF BIG… and look what happened today… ended down almost 2%.
The VIP Chart looks bearish this evening, but the closing-print in the middle of today’s range tells me that tomorrow is an open book as far as direction goes so we will stick to the plan and trade with the opening-bell tomorrow morning.

I am selling short tomorrow with an opening-print below 1233.5, and I am buying long with an opening-print above the 1251.6.

Anchor Chart:
The anchor chart of gold leaves the door wide open for both sides to have a chance to take control of price-action on Friday.

Gold Anchor Chart 1
We can see a long term bullish price channel on the anchor chart and we are testing the lows of this price channel as we speak around 1240.0.  We can also see support below us at 1230.6 which tells us the sellers are going to have to work hard to get this price to drop easily tomorrow.

Gold Anchor Chart 2
The easiest way to trade Gold on Friday will be to wait for price to move higher up to the sell-zones overhead at 1254.1 and 1263.5.  The ideal location to sell short will be at these levels tomorrow because we will be selling when price is at a premium.


VIP Chart:
Russell VIP Chart
The Mini-Russell has been on a roller-coaster the last week and this evening we can see how sideways this market-personality has really been.

We have a bullish 2-day relationship, but at the same time we saw a bearish closing-print this afternoon which tells us that ANYTHING can happen for tomorrow.

I am going to sell short tomorrow with an opening-print below the 1126.3, and I will buy long with an opening-print above the 1144.5.
Anchor Chart:

The Anchor chart of the Mini-Russell shows us trading sideways in the short term with a long-term-trend that is still bullish.

Russell Anchor Chart 1
We have some major levels of support below us on the anchor chart at the trend-line around 1120.0 and then more support down at 1111.1 and the big-round-number of 1100.00.  This support is likely to interrupt this falling market…but the buyers don’t have it much easier if you look closer.

Russell Anchor Chart 2
A closer look of the anchor chart shows us lots of support below and resistance above which tells us that Friday may be a range-bound market if the buyers and sellers can’t take control early in the session.

My goal for Friday is to sell short when price gets below 1118.9 and use the 1100.0 big-round-number as my profit-target.  I will buy long when price gets above the 1142.1 and use 1148.5 and 1156.3 as my profit-targets.

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