Monday, February 1, 2016

Waiting to Fade the Correction | Crude Oil, Gold, E-mini & Euro Futures 02/01/16



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“Opportunity is missed by most people because it is dressed in overalls and looks like hard work.”

Notes for Tonight’s Newsletter:
Crude Oil is bearish with three legs down and a spike & channel this evening which tells us to look for the next selling opportunity after a bullish correction off the lows.  Crude Oil feels 'heavy' this evening, even after three legs lower the sellers appear to have all intentions to keep pushing lower tomorrow.  Our goal is to sell 'high' rather than selling 'low' so the most reliable trades will come after we get this price up above the moving average and sell into the buyers stops, but if we don’t get that chance we will be looking to sell the highs of the spike & channel with a target down at the third measured-move at 31.00 and possibly down to major support at 30.38.  Buyers have to wait for a new higher-high and hold a pullback before they can even consider trying to buy this market right now.

E-mini S&P is bullish this evening but after a measured-move and overshoot of the channel-high we expect a correction back to support levels before the next leg higher.  The E-mini pulled a 'U-turn' this morning after 10am news was released and completed a channel-rotation fit for a post-card.  Buyers want to see this correction completed, followed by sellers failing at the moving-average for the first clue to go higher.  The most reliable buying opportunities will come after a new higher-high and a pullback to the moving-average.  Sellers want to wait for this correction and then look for buyers to fail on the next pullback to get 'short' back to 1918.50 and 1912.50 tomorrow.

Gold pushed higher aggressively today and appeared to want to complete a third leg higher but the close of today's session looks pathetic so wise buyers will wait for a 'trap low' before looking for the next leg up tomorrow.  Gold had no trouble completing the measured-move this morning and then it held strong on the pullback around noon and shot higher into the close today, but the closing candle leaves the buyers wondering if this move is over for the short-term.  It is likely that buyers will see this price as too expensive to buy, so they will wait for a 'trap low' just below the 1125.0 support and look to buy into seller-failures.  Sellers can look to get 'short' into buyer-failures at these highs, with a target at the 1125.0 but they need to be careful because this is a bullish market.

Euro is bullish inside a range this evening after three legs higher today which tells us to look for 'bear traps' at the lows of the range for the most reliable buying opportunities tomorrow.  We can easily see this market is bullish a major channel and three measured legs today which ended in a range.  Using range-rotation we just came off the highs (dramatically) so the next stop should be the lows, and with a measured-correction just below the range lows we know what will be where the buyers want to get long again tomorrow and all we need to do is wait patiently.  Sellers have a challenge ahead of them tomorrow because there are a LOT of support levels waiting below without much open-space to play with.



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