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Notes for Tonight’s Newsletter:
We've had a wacky first week of October but looking at the charts tonight it's easy to find some reliable trading opportunities for tomorrow; Crude Oil is bullish working its way back to the highs of a somewhat lazy bull channel, E-mini S&P is bearish and trading with multiple levels of resistance overhead, Gold is bearish after a runaway session today as sellers are trying to finish off the wedge, and the Euro is bullish and trying to re-test the high but the sellers appear to be digging their heals into the low of the bull channel and looking for a trap.
Crude Oil is bullish working its way back to the highs of a somewhat lazy bull channel with a target up at the measured-move. The bulls look really strong coming off the API Report this afternoon but the reversal-line analysis reminds us that trying to buy high will be challenging and we should be waiting for deeper pullbacks for the most reliable trading opportunities tomorrow unless the buyers can get a successful breakout-pullback above the measured-move tomorrow. Watch out for this strong move higher to develop into a spike and range or spike & channel, and if so, keep focused on buying low and taking profit at the highs.
E-mini S&P is bearish and trading with multiple levels of resistance overhead and a weekly target waiting below which tells the buyers they have a lot of work ahead of them tomorrow and the sellers to look for traps and failures as price tries to push higher and retracements on the way down to re-test the lows. The big 'line in the sand' right now is the reversal-line and measured-move at 45.25 which will likely play a key role in tomorrow's session.
Gold is bearish after a runaway session today as sellers are trying to finish off the wedge and measured-move targets waiting below. When a market is moving this aggressively it can be uncomfortable selling the lows but until we reach the objective targets we may have no other choice tomorrow. The ideal scenario for the sellers is to see price correct off the lows and test the reversal lines waiting at 75.9, 83.6 and 91.7 and then use failures to sell back down to the lows. The buyers on the other hand have a big challenge ahead of them because without an extremely strong move back higher we can assume that any move off the lows will be seen as a selling opportunity tomorrow until we reach that target.
Euro is bullish and trying to re-test the high this evening but the sellers appear to be digging their heals into the low of the bull channel so buyers will be wise to look for either a trap-low below the key reversal-line at 12115 or a strong breakout-pullback on the way up to the highs. Sellers on the other hand would love to see a break down below the reversal line and then hold a pullback for a move to test the lows or a gap-fill overhead and then hold below the rising support trend line tomorrow.
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