Wednesday, April 6, 2016

Look for the Correction | Crude Oil, Gold, E-mini & Euro Futures 04/06/16

“Stay committed to your goals, but flexible in your approach.  Life will always try to challenge your resolve, but with a positive attitude and a firm belief in yourself you can accomplish anything you set your mind to.”

Notes for Tonight’s Newsletter:
The oil and equity markets are running higher on all cylinders after a third leg pushed prices higher today, while metals and currencies are sideways after today's FOMC meeting minutes projected the next rate hike in April.

Crude Oil is bullish with a spike & channel this evening which tells us to look for opportunities after a pullback into the 'correction zone' tomorrow.  We have two spike & channels on the chart this evening which illustrates just how strong this multi-day bullish move day has been.  The first spike & channel began with Tuesday’s 4:30pm EST API-Report and the buyers continued that move after the DOE-Report this morning at 10:30am EST.  Spike & channels tell us to look for buying opportunities at the lows of the channel as well as buying after a pullback into the 'correction zone' back at the base of the channel. 

E-mini S&P is bullish with a major bull channel which tells us to use channel 'rotation' for the most reliable opportunities tomorrow.  We have a major bull channel and a minor spike & channel on the chart this evening.  The major bull channel tells us to expect price to rotate from low up to high and then back down again which means we still have room left to keep climbing, and it also tells us a move back to the lows will be a 'channel undershoot' and to expect a 'trap low' at support levels below.  The spike & channel tells us there is a correction zone down at 2054 where we can look for 'seller failure' before we go back up to re-test the highs.

Gold is range-bound with a bear-bias this evening and 'rotation' tells us to look for selling opportunities after the buyers try to push it higher tomorrow.  We have a bear channel and a trading-range on the chart this evening.  The bear-channel gives us a directional bias and with a recent test of the channel low we now expect rotation back to channel high where sellers will be looking for buyer-failure to begin the move back to the lows and a possible measured-move.  The trading-range is bearish and a recent 'trap' at the low tells us the next move will likely be back to the highs where sellers will be waiting for the buyers to try twice and fail back to the lows.

Euro is still range-bound and a recent test of the high tells us to look for a move back to the lows and sellers will be waiting for the buyers to fail twice.  We have a trading-range and bull-channel on the chart this evening.  The trading-range tells us to use rotation and the '2-try rule' to look for failures to buy the lows and sell the highs tomorrow.  The buyers appear to have tried twice on a micro-scale but we know that the 2nd try is likely to attempt the measured-move before this price comes back down again.  The bull channel is trading at the lows which tells us buyers will be gunning for the highs again and a possible measured-move.

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