2 Strength Clues Thurs | Crude Oil, Gold, E-mini & Euro Futures 04/27/16

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“The secret to life is meaningless unless you discover it
yourself.”  – W. Somerset Maugham

Notes for Tonight’s Newsletter:

Markets
are reacting to the FOMC
Announcement this afternoon; Crude Oil and the S&P are both bullish
and trying to re-test their highs, while the Gold and Euro are both incredibly range-bound
and trying to find a direction for tomorrow’s session.

Crude
Oil is bullish and trying to re-test the highs of the range this evening but a
recent ‘channel-overshoot’ and falling-resistance may give the buyers another
chance to buy this market at a much lower price tomorrow.  The major bull channel will be waiting as
support if we get a deep correction lower, while the minor bull channel has an
overshoot at the highs which will likely either overshoot the lows or give us a
double-overshoot at the highs for a possible reversal tomorrow.  The measured-move has already been reached
which tells us to expect another test of the highs where we can also expect the
sellers to be waiting for a possible reversal back to channel-lows.  Meanwhile, there is falling-resistance which
may keep the buyers from finishing the re-test of the highs until after the
correction back to the lows of the channel.

E-mini
S&P is bullish and trying to finish rotation back to the high of a bull
channel.  The recent ‘trap-low’ is a big
sign of strength for the bulls, telling us that tomorrow may bring a strong
move higher in the medium-term.  The bull
channel tells us to expect rotation from low to high and then back to the
lows.  The ‘trap-low’ occurred at the
recent swing-low and shows the buyers’ strength going into the closing-bell
this evening after already making three legs higher in today’s session, which
is a definite clue to the overall bullishness of this market going into
tomorrow’s session.

Gold
is range-bound and trading sideways after today’s FOMC Announcement which means
our plan is simple for tomorrow; Buy low, sell high, focusing on range-rotation
and the failures until this market finds a trend in one direction or the other.  The trading-range tells us to use rotation
and failures to buy the lows and sell the highs, giving each side ‘two tries’
to break higher or lower tomorrow.  The
FOMC announcement broke both the highs and the lows of the range today which
tells us to assume that sellers will defend the highs at 54.7 and buyers will
defend the lows at 43.2 which makes the extreme highs and lows a big target for
tomorrow.

Euro
is similar to gold this evening, trading sideways inside a range, so our
plan is to look for failures at the highs and lows to ‘fade’ the move back to
the original range until we see this market find a direction tomorrow.