Monday, October 6, 2014

3 Ways to Profit on Tuesday | SchoolOfTrade Newsletter 10/06/14

“Nothing in the world can take the place of Persistence. Talent will not; nothing is more common than unsuccessful men with talent. Genius will not; unrewarded genius is almost a proverb. Education will not; the world is full of educated derelicts. Persistence and determination alone are omnipotent. The slogan ‘Press On’ has solved and always will solve the problems of the human race.” –Calvin Coolidge
Notes for Tonight’s Newsletter:
·       Markets reacting today to last Friday’s BIG Non-Farm Payroll which showed better-than-expected numbers, but many traders saw ‘cracks’ in the headline jobs number.
·       Crude Oil pushes lower to re-test the lows at $88.00/barrel but closes back around $90.00 for the session and goes into a sideways-trading-range.
·       Gold erases the post-news collapse, jumps back above the key-level of $1,200/oz., closing at $1,207 for the biggest 1-day rally since June, and gives us an easy selling opportunity at these highs.
·       Mini-Russell (as well as the other e-minis) ends the day almost flat, but then starts to push lower in after-hours trading.

·       Fundamental:  A strong Non-Farm Payroll report on Friday, combined with a strong US-Dollar, and a world that appears to have adjusted to the violence in the Middle East are all pushing Gold lower as the ‘flight to safety’ becomes less valuable.
·       Technical:  Gold made a strong push below $1200/oz. last Friday, making new lower-lows and giving us another set of sell-zones that we can use this week for more selling opportunities.  Today we retraced all the way to the highs of the range from last week which is a PERFECT area to begin looking for new selling opportunities this week.

Crude Oil:
·       Fundamental: The list keeps growing for reasons to stay SHORT on the ‘black gold’ this week.  A strong US-Dollar is pushing prices lower because Crude Oil is denominated in the mighty-dollar.  The sluggish global economy has many traders seeing demand for Crude Oil pushing lower, and of course we have Ebola causing people to skip that vacation around the world which is further adding to the consumption of Crude Oil and its byproducts.  On top of that… they aren’t calling for any cold weather anytime soon to come to the rescue!
·       Technical:  Crude Oil is bearish on the long-term-trend but in the short-term we saw Crude Oil try to move to new lows today but the sellers just weren’t strong enough and we failed to keep the party moving lower.  With the lack of new lower-lows in the price-action today we can assume a price wedge will develop which means we will still be looking for selling opportunities at the highs, but our profit-targets down at the lows will be much more conservative.

·       Fundamental:  The sluggish global economy, along with profit-taking off the recent all-time-highs on the Mini-Russell have made for awesome selling opportunities over the last few weeks and with last Friday’s somewhat-misleading Jobs report we could have trouble making new higher-highs anytime soon.

·       Technical:  Just as we had anticipated, last Friday’s Non-Farm Payroll report gave the Mini-Russell a boost and pushed the price-action up to the highs of the range… but that didn’t last very long.  As of writing, the Mini-Russell is making new lower-lows off the highs and has a new bearish price channel that we are using to get into new selling opportunities with targets back down at the same lows from last week.
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