Monday, August 11, 2014

6 Trades for Sideways Markets | SchoolOfTrade Newsletter 08/11/14

"Knowing which way to turn gives you self-confidence. Taking a chance and going the opposite way gives you a chance to see what you are made of." - Bob Perks.
Today’s Newsletter:

·       Traders see low volume this 3rd week of August as summer-Monday kick-starts the week of OPEX
·       Options Expiration is this Friday, August 15th
·       Very light news calendar this week
·       Markets started the week on a very bullish tone thanks to Chinese Inflation report Sunday evening
·       Geo-political woes appear to be on the back-burner early this week (Russia, Ukraine, Gaza/Israel)
·       Crude Oil apparently waiting to hear more from Europe
·       Gold appears to have settled down after last week’s fear entered the market
·       Mini-Russell jumped higher today, but will it last?

·       Long-Term Direction Bias = NEUTRAL
·       Short-Term Directional Bias = NEUTRAL / Bullish
·       Fundamentals:  geo-political fears pushed prices higher last week, today it appears these issues have been forgotten… will see what happens overnight
·       Daily Chart:  sitting in the middle of the range, on top of the $1300 big-round-number and stuck at the 200ema
·       32-Anchor Chart:  bullish trend and market-structure, however, the next move will tell us the direction to trade in this week.
·       16-Anchor Chart:  lower-highs and double-bottoms suggest we go lower.  Look for lower-lows below 1305.7
·       Profit-targets above @ 1320.3, 1322.2, 1324.3
·       Profit-targets below @ 1302.7, 1297.5, 1290.3, and 1285.9

Crude Oil:
·       Long-Term Direction Bias = Bearish
·       Short-Term Directional Bias = NEUTRAL / Bearish
·       Fundamentals:  Concerns about the EUR have pushed the USD higher, making the Crude Oil less expensive and prices have collapsed… even in the face of violence in the Middle East.  We will be looking for more info from both parts of the world as this week of geo-political and economic news is released.
·       Daily Chart:  sitting at the lows of a bull price channel as well as on top of major support at 97.12.  We have been stuck around $97.50 for the last few days.
·       32-Anchor Chart:  Long-term-trend is down; however, short-term is sideways and consolidating.  We picked up where we left-off last week, easy to see people are waiting for more news from Middle East and Europe this week.
·       16-Anchor Chart:  stuck in the middle of this sideways-trading-range.  We want to buy-the-lows at support and sell-the-highs at resistance with a preference to the sell-side because of the long-term-trend being down.
·       Profit-targets above @ 99.09, 99.49, 100.00
·       Profit-targets below @ 96.98. 96.55, 94.13

·       Long-Term Direction Bias = NEUTRAL / Bearish
·       Short-Term Directional Bias = NEUTRAL / Bullish
·       Fundamentals:  Chinese news gave equities a boost, however, the issues with Europe aren’t quite over yet, so we will be listening and watching closely this week.
·       Daily Chart:  price-action got sucked back into the range between our long-term-trend and short-term trend moving-averages today.
·       32-Anchor Chart:  price jumped higher today, but we now test the highs of the long-term bearish price channel around $1150.  We are likely due for a pullback before we go higher.
·       16-Anchor Chart:  big move today tells us to look for buying pullbacks, however, we have opportunity to sell short on the way down.
·       Profit-targets above @ 1149.2, 1156.9, 1161.6, 1169.6

·       Profit-targets below @ 1130.0, 1126.6, 1121.6, 1105.2, 1103.3

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