Tuesday, October 14, 2014

9 ways to Trade Wacky-Wednesday | SchoolOfTrade Newsletter 10/14/14

“The quality of a person’s life is in direct proportion to their commitment to excellence, regardless of their chosen field of endeavor.” –Vince Lombardi
Notes for Tonight’s Newsletter:
·       Markets are reacting to a slew of new developments since last week, and providing traders with exciting volatility and trading opportunities today!
·       Crude Oil prices continue to push lower, today down 5% to $81.95 for its largest single-day move of 2014.
·       Gold keeps pushing higher on fears of a global slowdown will prompt central-bankers to print more cash and devalue their currencies
·       Mini-Russell finishes the day at breakeven, although buyers gave it a try over lunch but price-action settled back in the middle of the trading-range
·       Wednesday’s news begins in Asia, then moves to London at 4:30am, and then into the US for 8:30am EST Red-Star News
·       Options Expiration is this Friday, be ready with this tutorial

·       Fundamental:  Gold has been rising higher over the last 2 weeks on the fear that the recent downturn in the global economy will prompt central-bankers to resort to printing more money and devaluing their currencies.  When money is printed, each dollar (or Yuan, or Euro, or Yen) is worth less, so speculators are moving their money from paper currencies into the ‘yellow metal’ to protect against further currency risks.  For this reason we see Gold staying bullish until ‘something’ changes.

Crude Oil:
·       Fundamental:  The global slowdown continues to hurt Crude Oil prices as the demand drops and production has yet to be cut across OPEC countries.  The EIA monthly report slashed global oil demand forecasts for 2014 and 2015, along with reports from Iran where leaders are saying that they are ‘ok with lower oil prices’ and recently we heard from Saudi Arabia who reported today that they too are ok with lower prices, even in the $80/barrel range without ANY adjustment of supply in order to ‘shake out the weak hands’.


·       Fundamental:  Equity markets are floundering right now, coming off all-time highs only a few weeks ago it appears that investors have lost a lot of confidence in the global economy and that is showing in the price-action on our charts.  With oil prices falling lower we see a lot of pain in the energy companies below $90.00/barrel, many of which are VERY large players on Wall Street, and traders have been weary to buy into another rally.  Time will tell where this market goes, but for now it appears the bears have started passing around the ‘Kool-Aid’.

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