Wednesday, August 30, 2017

Risk vs. Reward Trading Strategy | Crude Oil, Emini, Nasdaq, Gold & Euro



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Crude Oil is bearish and trying to re-test yesterday’s low, but a rising support trend-line stands in our way, so we’re looking for “traps” for selling-opportunities tomorrow.

S&P is bullish with a flag pattern, telling us to look for buying opportunities with seller-failures down at the low of the range tomorrow.

Nasdaq is bullish with another strong, but low-volume run higher today, and I’m watching for a “hidden channel” to help buy pullbacks tomorrow.

Gold is bearish with a Spike & Range, telling us to avoid selling the low, and focus on selling up above the range using the '2-Try Rule' tomorrow.

Euro is bearish with a potential Spike & Channel as it tries to finish the move back to last month’s high, so I’m looking for a “bull trap” up above the resistance levels waiting overhead.


Crude Oil Trading Strategy
Crude Oil is bearish and sellers are now trying twice to re-test yesterday’s low and complete their measured-move target tomorrow.

This move off the highs looks like a Spike & Channel developing, and the rising support trend-line appears to be our last big hurdle at this point.

The goal is to look for selling-opportunities up above the previous bear-swing, while avoiding the temptation to sell into the lows until we see a successful breakout-pullback.

One thing to keep an eye on tomorrow is this possible triangle developing on the chart.  If the bears fail to hold this lower, the bulls may push back to the highs, but beware chasing the move higher because there will most likely be additional sellers waiting for a great risk-reward-ratio back down to the low.

E-Mini S&P Trading Strategy
E-Mini S&P is bullish with a strong run higher, which will likely develop into a bull-flag and/or “hidden channel” tomorrow.

The buyers appear to be failing on this recent pullback which isn’t much of a surprise, assuming that a lot of buyers will be looking for a little better risk-reward-ratio down in the ‘battle zone’ tomorrow.

Keep an eye on the bull-flag, which looks like a bear channel coming off the high, which hopefully will line-up with the “hidden channel” coming up off the lows.


E-Mini Nasdaq Trading Strategy
E-Mini Nasdaq is bullish after another “zombie-like”, low-volume run higher today with a bull channel and potential “hidden channel” on the chart for tomorrow.

The bulls clearly have control, but for the second day in a row, we haven’t seen any real pullbacks, which tells us there are likely a LOT of bulls waiting on the sidelines for something decent to buy.

The goal for tomorrow is to look for a deep pullback, avoiding the Double-Up resistance, and watching the “hidden channel” and ‘battle zone’ support levels.

Gold Trading Strategy
Gold is bearish with a Spike & Range as it tries to finish the move back to fill the gap left open from Monday morning.

The bears clearly have control, but sitting at yesterday’s low, it’s easy to see that sellers are “rejecting” the idea of selling to new lows, so we need to look for more reliable selling-opportunities up at resistance levels overhead to increase our odds of success.

Euro Trading Strategy
Euro is bearish and trying to finish the move back to the prior month high tomorrow.

The bears had a nice strong move lower, they sold the pullback to the moving-average, and now they are sitting at the daily lows, just a few points above what we assume will be the market's objective at the prior month high.


The goal for tomorrow is to look for selling-opportunities up at resistance levels overhead for a better risk-reward-ratio than trying to chase this move lower.

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