Monday, September 22, 2014

3 Reasons to stay Patient on Tuesday | SchoolOfTrade Newsletter 09/22/14

“Success is not the key to happiness. Happiness is the key to success. If you love what you are doing, you will be successful.”–Albert Schweitzer
Notes for Tonight’s Newsletter:
·       Traders return to their desks after last week’s Quadruple Witching ‘trader holiday’
·       Big news coming tonight from China, as well as Europe tomorrow morning
·       Most of our markets are ‘oversold’ at this time, which tells us to stay patient for the best selling opportunities tomorrow.

·       Fundamental:  Fundamentally speaking, if the ECB or CHINA announces any new stimulus measures (printing more cash) that will likely be the reason we see Gold make a strong push higher off these lows.
·       Technical:  Gold is “technically” over-sold at this time and we are staying patient for a retracement off the current lows for the best trading opportunities this week

Crude Oil:
·       Fundamental:  traders are worried that the slowdown in Asia and Europe will affect the demand of Crude Oil Futures this week.  Combined with a strong US-Dollar there is a recipe for bearish Crude Oil prices this week.
·       Technical:  Our long-term-trend is clearly BEARISH at this time, seeing lower-lows and lower-highs on the slower anchor charts… however…look closely and you can see that late last week we FAILED to make new lows, which causes us to stay patient to wait for new lower-lows before we can call this trend bearish in the SHORT-TERM TREND.

·       Fundamental:  A strong US-Dollar, along with a lack of options for global long-term investors have been pushing the US equity markets higher for most of 2014, but this may be coming to an end.  Late last week we started hearing big concerns about the economic slowdown in China, which resulted in major profit-taking on the Mini-Russell and Nasdaq this week.  We expect to see this continue to move lower if the BIG NEWS from China later this evening confirms this slowdown.   A Large majority of investors have 100% of their investments in US Equities, which makes for a very steep sell-off if these people lose their confidence this week.  We will be watching closely in our Live Trade Room.

·       Technical:  We are making new lower-lows on our charts, but the price-action is oversold, which tells us to stay patient to wait for the best trading opportunities selling short on Tuesday morning.  

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