Monday, April 17, 2017

Trading with Traps | SchoolOfTrade Newsletter 04/17/17



“The most important thing you can do to achieve your goals is to make sure that as soon as you set them, you immediately begin to create momentum. First, write the goal down.  Second, take one step towards achieving the goal.  Third, start every day thinking of one way you can get closer to your goal.  Take action, get momentum on your side and you’ll be amazed how much you can accomplish.


Crude Oil is bearish, but sitting at today’s low, just a few points below the 'double-down' and measured-move tells us we need to wait for a better opportunity to ‘sell high’ tomorrow, and we have the ‘battle zone’ waiting overhead.

E-Mini S&P is bullish after a low-volume rally sent prices fluttering higher, but we NEVER got a pullback, telling is that buyers are likely waiting back at support levels to re-test the high tomorrow. 

Gold is bearish, but sitting right on multiple major support levels tells us to avoid selling these lows, and look for better opportunities up at resistance levels waiting overhead.

Euro is bearish and trying to re-test today’s low after the bulls failed to hold for a re-test of the measured-move earlier in today’s session. 

FDAX is bearish with a spike & channel, which tells us everyone is already short this market, and to look for traps and failures at the highs tomorrow.

We’re back from the holiday weekend, rested and refocused, and ready to find some great trading opportunities on Tuesday.


Crude Oil Trading Strategy
Crude Oil is bearish and sitting at today’s low, just a few points below the 'double-down' and measured-move support levels.  The bears have control, but we are “two legs down” off the highs, which tells us that most sellers will consider this market to be oversold, waiting patiently for a ‘2-legged correction’ off these lows to “sell high” tomorrow.  One thing that stands out on this chart is the previous day low, which stalled the sellers earlier in the session.  I’d like to see selling-opportunities above the PLOD to use that as a magnet, so look for a test of the ‘battle zone’ overhead for the most reliable selling-opportunities tomorrow.

E-Mini S&P Trading Strategy
E-Mini S&P is bullish after a low-volume rally sent prices fluttering higher, all the way back to the previous session high.  The first thing that stands out is the fact that price never really pulled-back to allow buyers to ‘buy low’, which tells us that buyers are likely waiting for the next pullback.  With that said, we’re looking for ‘2-legged pullbacks’ to support levels where we can use traps and failures for entry triggers going back to re-test the highs tomorrow.

Gold Trading Strategy
Gold is bearish and trading at the low of a channel, the measured-move, and the previous low of day.  The bears have control, but they won’t be too interested in selling this low, so the plan is to look for selling-opportunities up at resistance levels overhead.  One thing to keep in mind; this recent move lower was VERY strong, telling us the sellers may not wait to re-test the high of the channel, so watch for ‘2-legged corrections’, traps, and failures at all of the resistance levels overhead, with a target going back to re-test the low.

Euro Trading Strategy
Euro is bearish and trying to re-test today’s low after the bulls failed to hold for a re-test of the measured-move earlier in today’s session.  The bulls started with firm control, but they couldn’t keep it together after the first test of the measured-move, and this move lower is just too strong to give the bulls any confidence.  Sellers want to avoid chasing this move lower, so watch for a “trap” up around the GAP, or at least a buyer-failure above the moving-average for the most reliable selling-opportunities back down again.

FDAX Trading Strategy

FDAX is bearish with a multi-session spike & channel, which tells us that most traders are already short at this point, making the most reliable selling-opportunities up at resistance levels overhead.  The bears have control, but we don’t want to ‘sell low’ in this situation, so we’re waiting for a correction so we can use failures and traps for a sell back down to the lows.  One thing to keep in mind for tomorrow; we’re coming off a holiday break, and a LOT has happened in the past 96 hours, so we are likely going to see some volatility at the opening-bell, so wait patiently for the volatility to subside and then follow the new direction (if there is one).

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