Thursday, February 13, 2014

Bad News still Great News for Gold and Equities | SchoolOfTrade Newsletter 02/13/14

I have not failed.  I've just found 10,000 ways that won’t work.  There is no such thing as failure, only results.

Reflections from Today:
·       Today:  Both Gold and Mini-Russell Trades earn profit
·       Incredible volatility & trading opportunities
·       Crude Oil;  Sideways  +126ticks @ 100.35
·       Gold; Higher +168ticks @ 1302.6
·       Russell; Higher +274ticks 1142.5
·       Jobless Claims rise (bad)
·       Retail Sales fall (bad)
·       Janet Yellen Testimony delayed due to Snow (surprise!)
·       Feb 13th 1633:  Galileo arrives in Rome to face charges that he advocated the Copernican Theory
·       Feb 13th 1990:  Dow breaks above 7,000, only 12mos after breaking 6,000
·       Feb 13th 2001:  GM & Fidelity launch first wireless/mobile stock trading system
·       Tonight:  Chinese Consumer Prices (8:30pm) & Eurozone GDP (2:00-5:00am)
·       Tomorrow:  Import/Exports, Industrial Production, Consumer Sentiment
·       Friday = Valentine’s Day
·       Monday = President’s Day Holiday; US Markets Closed

Economic News for Tomorrow:

We have Red-Star News on the calendar this evening from China and tomorrow morning from Europe before we see news in the US morning session.

First, we have Chinese Consumer Prices this evening at 8:30pm EST, which is certain to get these markets moving into tomorrow’s trading session in London and the US.

Second, we have GDP news from Germany, France, Italy and Spain tomorrow morning starting at 2:00am EST and this is more news that will definitely have our favorite markets moving well going into the US trading session.

Third, we have more news coming in the US morning session.  Starting with Import/Export Prices at 8:30am, and then we have the headline news tomorrow from Industrial Production at 9:15am EST before the Consumer Sentiment Report just before 10:00am EST.

8:30am EST:             Import/Export Prices
9:15am EST:             Industrial Production
9:55am EST:             Consumer Sentiment

Day trading plan for Tomorrow:

Crude Oil:

VIP Chart:
We continue to have trouble getting away from this 100.00 big-round-number as well as
Crude Oil VIP Chart

last week’s highs and this week’s narrow trading-ranges tell me that something BIG is likely around the corner for Crude Oil futures.

My plan for tomorrow is to look for buying opportunities above 100.66, and selling opportunities below 99.54.  If we open inside the range between these levels I will trade inside the range, buying the lows and selling the highs while avoiding the 100.00 big-round-number.

Anchor Chart:
Crude Oil Anchor Chart
The anchor chart of Crude Oil doesn't look much better this evening, with a clear sideways-trading-range around this big-round-number at 100.00.  Without any real trend to follow I am left to buy at the lows and sell at the highs until something comes along and pushes this price-action higher or lower.

My plan for Friday is to avoid trading around the big-round-number of 100.00 as well as looking for buying opportunities around the support levels at 99.60, 99.25 and 98.03.  If price rises I am looking for selling opportunities at the resistance levels overhead at 100.96, 101.15, and 101.68.


VIP Chart:

Gold VIP Chart
Gold has been a big mover this week and has made us a lot of profit along the way to the big-round-number of 1300.00.  We can see a bullish market-personality with a closing-print today near the highs.  All signs point to higher prices on Friday, but we always we will wait for the opening-bell tomorrow morning to see where we go from here.

My plan for Friday is to look for buying opportunities above the 1300.9 and selling opportunities below 1291.8 with a profit-target down at the previous lows at 1274.5.

Anchor Chart:
Gold Anchor Chart 34
We can easily see the long term bullish trend on the 34 anchor chart of Gold this evening.  We can see the bullish price channel along with higher-highs and higher-lows on the way higher to the next major sell-zone above at 1328.6.

As we zoom in closer on the 21 anchor chart we can see a similar short-term bullish price channel along with buying opportunities at the support levels below at 1294.6 and 1289.8 on the way to our profit-targets up at 1303.0, 1307.7, and 1312.7.

Gold Anchor Chart 21
My plan for Gold is to continue to follow this trend higher, waiting to buy as the price pulls back into buy-zones we have outlined below.  I always want to buy at a discount, so I am going to stay away from these highs.


VIP Chart:

Mini Russell VIP Chart
The Mini-Russell was tied to a rocket-ship in today’s trading session, moving just over 275-ticks during the US session alone.  This bullishness in the face of poor news from Jobless Claims and Retail Sales tell us that this strength is most likely here to stay.

The wide trading-range we saw today tells me that tomorrow may be a narrow trading-range day, so I will be looking for clues at the opening-bell tomorrow morning before taking my first trade.

My plan for Friday is to look for buying opportunities above the 1146.6 and selling opportunities below the 1119.2 low from today.  If we open tomorrow inside today’s trading-range I will consider this market-personality to be ‘in balance’ and I will look to sell down to the lows at 1119.2 or up to the highs at 1146.6 as traders begin to explore the range.

Anchor Chart:
Mini Russell Anchor Chart
The anchor chart of the Mini-Russell is very bullish this evening, and we can easily see that price is currently trading at the HIGHS of the range, telling us to wait patiently for a pullback before we try to get back in for another push higher.

We can see a bullish price channel along with higher-highs and higher-lows on the way to the target at 1147.2. 

We can also see two easy buy-zones this evening at 1132.9 and 1125.1 which I will use for buying opportunities this evening and into tomorrow.  My profit-targets for the buying opportunities are up at 1147.2, 1149.9, 1154.8 and 1158.2.

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