2 Ways to Trade Breakout Pullbacks on Tuesday
Short week ahead of us, let’s make it count!
We had some big moves on the charts today, which means there’s plenty of opportunity going into Tuesday…
The Emini and Nasdaq are both bearish with strong runs lower to finish today’s session – I’d love to short a breakout-pullback, we just need the trigger…
Crude Oil is range-bound with a bear bias — I’ll be looking for ways to short this breakout-pullback off the highs, but I need to clear a support level first…
Plenty of opportunity going into Tuesday – keep these setups on your radar…
E-Mini S&P (ES):
E-Mini Keys to Success:
Today’s wild ride on the Emini ES ended with bears in control of momentum with a strong push lower, suggesting that sellers will be waiting to short the next pullback off resistance levels above us.
Sellers can look for entries off the high of this new channel, they can wait for a range to develop and sell above the range, or they can sell the first bounce off the lows if price continues to push lower.
Buyers don’t have any momentum right now, so it’s best to wait for a 123-Reversal off these lows and look to buy the first pullback off the new channel.
Keep in mind – these wild swings today often result in a range tomorrow, so keep an eye out for overlapping candles and a flattening moving-average to confirm the range.
E-Mini Nasdaq (NQ):
Nasdaq Keys to Success:
The Nasdaq also had a wild ride today, finishing with bears in firm control of momentum.
With such a strong move lower, sellers will be looking for shorts at resistance levels above us, such as the low of this range or the resistance trend-line coming down overhead.
If price goes lower, sellers can look for “trap” entries before they reach the measured-move.
And if price goes sideways (expected after such wild moves today) we know sellers will be waiting to get short at resistance levels above the range.
Buyers need to stay patient for a reversal because anytime we see such a strong move lower, we know another leg lower is expected.
Crude Oil Futures (CL):
Crude Oil Keys to Success:
Crude Oil is “range bound” today, telling us to buy low and sell high with failure patterns using the range as a price-magnet.
Buyers made a strong run higher this morning, and with a support trend-line below us, it’s easy to think the bulls may attempt a breakout running higher.
Sellers will be looking for shorts off these highs, and will likely try using this trend-line as resistance for the entry on the opposite side.
Buyers will wait for proof of a breakout running higher, then look to buy the first pullback off a new channel on the way up to last Friday’s high around 79.35.
