Thursday, July 21, 2016

Friday's Trading Plan | Crude Oil, Gold, E-mini & Euro Futures 07/21/16

"My daily goal is to do something that will get me closer to a better tomorrow."
Notes for Tonight’s Newsletter:
We had some incredible trading opportunities today across all of our favorite markets and with some big moves today we know that tomorrow is setting-up to be another big Summer-Friday; Crude Oil and the S&P are bearish while Gold is bullish and Euro is trading sideways.

Crude Oil is bearish and grinding lower down the bottom of a bear channel this evening; The bears had control of this market for the entire session today, pushing through the measured-move and hunting for the double-down and triple measured-move targets waiting below.  Whenever we see this strong of a trend we know there will be sellers looking for opportunities at all resistance levels overhead with the most reliable entry points being at prior swing highs and the high of the bear channel.  Sellers may have a little bit more gas left in the tank to finish off the double-down but we know the most reliable selling opportunity at this point will be after a short-term correction up off the lows.  The odds are stacked against the buyers right now so they need to be careful trying to call a bottom and wait for proof with a new higher-high that can successfully hold a pullback before they look to buy anything tomorrow.

E-mini S&P is bearish with a spike & channel that is correcting higher to give sellers another opportunity to re-test the lows tomorrow; After a rocky start to the session, the sellers made both the triple measured-move and the double-down targets before sellers took their profit and the buyers got their shot during a correction back to resistance targets overhead.  The spike & channel is a big clue for the sellers because it tells them to stay patient and wait for buyer-failures at resistance levels overhead with a target back to the lows.  The buyers have a strong move off the lows which means they will be trying to get a second leg higher before the sellers look to re-enter this market tomorrow.

Gold is bullish and trading with a double-overshoot at the highs of a bull channel this evening; The bulls had control for the entire session today and finished in a very lofty position at the highs of the channel which tells us that the buyers need to keep this move going on strength or this market may collapse under its own weight and possibly run back all the way back to the lows tomorrow.  The double-overshoot of this channel gives the buyers a chance to buy the breakout pullback higher on strength with a target up at the double-up and triple measured-move overhead but it also gives the sellers a big window of opportunity tomorrow if we can get back below the measured-move support at 27.5.  The overshoot isn’t THAT big, so in all reality the buyers may be able to hold off the sellers at the 22.4 battle zone but we often see double-overshoots result in complete reversals, so we will be Watching closely if we do get the deep pullback tomorrow.

Euro is trading sideways and trying to finish rotation back to the highs of the range this evening; We saw a battle break out between the bulls and bears today that resulted in both sides failing to get successful breakouts and with the most recent failure coming from the bears we expect the 'pendulum' to swing for the bulls going back to the highs and possibly a breakout up to the double-up and range-expansion levels tomorrow.  Buyers will be looking for pullback opportunities on the way to the highs and then a strong breakout-pullback above the highs for a move up to the targets overhead.  Keep in mind, once we get back to the highs of the range we expect to see sellers re-enter the market, looking for buyer-failures to sell back down the lows again as price rotates back and forth inside the range until one side of the market can get a successful breakout tomorrow.

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