Monday, March 31, 2014

Day Trading Crude Oil, Gold, E-Mini Russell | SchoolOfTrade Newsletter 03/31/14

Fed Chairperson, Janet Yellen
“Pain is temporary. It may last a minute, or an hour, or a day, or a year, but eventually it will subside and something else will take its place. If I quit, however, it lasts forever.” Lance Armstrong
Reflections from Today:

·      Today’s Trades:
o   Crude Oil: 
§  buying lows, selling highs around $100.00
§  Too many opportunities to count!
o   Gold:
§  Short-selling opportunities last week
§  3 monster winning trades called!
o   Mini-Russell: 
§  Short-selling opportunities last week
§  2 Big Winning trades called!
·      Markets Today:
o   Crude Oil: 
§  Sideways-trading-range
§  Very slow early in the session
§  109 ticks of range (narrow)
§  Closing-print @ 101.48 (-0.19%)
o   Gold:
§  164 ticks of range (typical)
§  Closing-print @ 1283.69 (-0.83%)
o   Mini-Russell:
§  Bullish Market-personality
§  Reacts to comments from Janet Yellen
§  217 ticks of range (wide)
§  Closing-print @ 1166.7 (+1.61%)
·      News Today:
o   9:45am: Chicago PMI, lower than expected, Chicago economy slowest since August 2013
o   9:55am:  Janet Yellen speaks in Chicago
§  “economy still needs help”
§  “labor market is worse than what the numbers are saying”
§  Inflation target @ > 2%
§  Unemployment target @ < 5.6%
§  Monetary Policy to remain ‘lose’ for the future
o   10:30am:  Dallas Manufacturing
§  Much higher than expectations today
§  Everything’s bigger in Texas, including the Manufacturing sector
§  11-months in a row of growth
·      This Day In History:
o   Mar 31, 1889:  The Eifel Tower opens in Paris, France.  Tallest building in the country at that time, created to celebrate the French Revolution.
o   Mar 31, 1918:  Daylight Savings Time goes into effect in the United States.  Originally designed to help consumers use less ‘incandescent lighting’
o   Mar 31, “Mexican-Madonna”, Selena Quintanilla-Perez, 23 years old, shot by the head of her fan club in Texas
o   Mar 31, 1995:  Major League Baseball finally ends the sport’s longest strike @ 232-days.  1994 World Series cancelled for only the 2nd time in history.  (First time was 1904).
·      News Tomorrow
o   New month of April Begins (beware “April Fools”)
o   New Quarter Begins
o   Contract Rollover on Gold to the 06/14
o   7:50pm:  (JPY) Bank of Japan Survey
o   9:00pm & 9:45pm:  (CH) Manufacturing
o   11:30pm:  (AUS) Rate Announcement
o   3:50am: (FRA) Manufacturing
o   3:55am:  (GER) Manufacturing
o   4:30am:  (GBR) Manufacturing
o   5:00am: (EU) Employment Rate
o   9:45am: (US) PMI Manufacturing
o   Friday = Non-Farm Payroll News!

Economic News for Tomorrow:

Economic News Tuesday
We have a TON of important news on the calendar, most of it related to manufacturing, and starting this evening and going into the first day of April, Tuesday morning.

We begin with news this evening from Asia.  We hear from the Bank of Japan, Chinese Manufacturing, and a rate announcement from Australia.  This will be an exciting overnight session for traders this evening!

Tomorrow morning we begin in Europe, with manufacturing news starting at 3:50am EST.  We hear from France, Germany, Great Britain, and the E, which will take up most of the London trading session.

In the US morning-session tomorrow we have more manufacturing news starting at 9:45am, with the headline ‘Red-Star News’ at 10:00am EST from ISM-Manufacturing.

Trading opportunities for Tomorrow:

Crude Oil:

Crude Oil VIP Chart:
Crude Oil VIP Chart
We continue to trade in a sideways-range in today’s session.  All signs point to a ‘neutral’ day today, which leaves the door WIDE OPEN for anything to happen as we head into April and Friday’s Non-Farm Payroll.

Crude Oil 64 Anchor Chart:
Crude Oil 64 Anchor
We have moved away from the $100/barrel big-round-number, however the price-action hasn’t been any more consistent than it was back last week when we were on top of the big-round-number.

We can see resistance overhead at 103.02 on this 64 anchor chart of Crude Oil.

Crude Oil 16 Anchor Chart:
Crude Oil 16 Anchor
The 16 anchor chart shows Crude Oil in a well-defined bullish trend, with a price channel and higher-highs and higher-lows on the way up.  The only concern we have HERE NOW is that we are right at the highs and trading sideways. 

I want to BUY at a DISCOUNT on Crude Oil, so we will wait for buying opportunities this evening and into tomorrow at the 100.52, 100.17, and 100.00 levels below us.  We have a profit-target overhead at 103.19 for the buyers.


Gold VIP Chart:
Gold VIP Chart
Gold was odd this morning, especially when we heard Janet Yellen say that she would keep adding more help to the labor market…we ASSUMED that Gold would push higher, but it didn’t.  This is a big sign of bearishness in the Gold market going into tomorrow.  When good news is still bad news you are certainly NOT bullish, so the other option is this Gold is going to keep tumbling lower.

The VIP chart shows us a closing-print at the lows, but look closely…the VOLUME was the highest today at the highs, which means we spent the most amount of time up around 1293.0, which was also the closing-print on Friday. 

We are definitely bearish on Gold, but the fact that the VOLUME does not match today’s Closing-print is a sign that we may go HIGHER this evening before we go lower.

Gold 64 Anchor Chart:
Gold 64 Anchor
The 64-anchor chart shows us testing support at 1287.2 and looks like we are on our way lower to test the level at 1262.8 as well.  We are BELOW all the key moving-averages so if these sellers want to party, they have all the opportunity in the world right now…sell away!  Sell away!  Next profit-target is down at 1262.8 and then all the way down at 1227.3.

Gold 16 Anchor Chart:
Gold 16 Anchor
Now we’re talking!  The 16-anchor chart of Gold futures shows us trading at the lows from earlier in the session, and we have three (3) locations above us that we can use for selling opportunities this evening or tomorrow.  The profit-target for the sellers this evening is down at 1277.9 and then another at 1272.0

Mini-Russell :

Mini-Russell VIP Chart:
Russell VIP Chart
Mini-Russell pushed higher this morning, undoubtedly on the comments from Chairperson, Janet Yellen when she mentioned that she would not stop supporting the US economy because the Labor Market was not moving in the right direction.  Anytime our Federal Reserve Bank mentions ‘lose economic policy’ we know that equities will jump.

We can see the closing-print today as well as the volume were both at the highs of the session, with only some minor profit-taking at the closing-bell.  This is a sign that buyers are here to stay, and we will look for an opening-bell print tomorrow above 1171.7 to start looking for buying opportunities on Tuesday.

Mini-Russell 64 Anchor Chart:
Russell 64 Anchor
Yikes!  The Mini-Russell 64-anchor chart is a scary one this evening.  We recall that price wedge we were trading with last week, and now we can see this price wedge has been expanded further.

The big concern for us this evening on Mini-Russell is that we aren’t anywhere near a major turning point on this anchor chart.  We are in the middle of this price wedge, which means we expect price-action to be more challenging until we get to the highs or the lows.

Mini-Russell 16 Anchor Chart:
Russell 16 Anchor
Victory!  We are happy to see that the 16-anchor shows us some easy buying opportunities below us at 1161.1, 1157.9 and even down to 1149.9.  We can also see a profit-target above us at 1174.4 and 1182.0, which will be perfect for buyers who wait patiently with us to buy at a discount!

Our plan for the Mini-Russell is to buy at a discount when price tests the 1161.1, 1157.9, or 1149.9.  We will use the 1174.4 and 1182.0 as our profit-targets.

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