6 Trades for Thursday | SchoolOfTrade Newsletter 01/04/17

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“Do not hope for an easy life, work hard to achieve the strengths and skills to endure a difficult one.”

Crude Oil is bullish with a spike & channel, so we’re watching the ‘correction zone’.

E-Mini S&P is bullish and trading with a wedge and a ‘hidden’ spike & channel.

Gold is bearish after the buyers tried twice and failed to re-test today’s high.

Euro is bullish and trading just below today’s high, so we’re staying patient.

FDAX is bullish and trying to break free of the flag pattern and keeping an eye out for a failure.

Crude Oil

Crude Oil is bullish with a spike & channel this evening, which tells me to be looking for buying opportunities at support levels around the ‘correction zone’ tomorrow.  The ideal scenario for the buyers is to see a deep pullback below the low of the channel and then look for seller-failures for a move going back to re-test the high and the API news target overhead.  Sellers need to be careful tomorrow because this move higher happened late in the session today, which tells us there may not be many buyers that were able to get into this move, and they will be waiting patiently for a chance to buy low rather than chase this move buying high.  Don’t forget, the weekly Inventory Report was pushed back until tomorrow (Thursday) at 11:00am EST, and my plan is to avoid trading during that time tomorrow.

E-Mini S&P

E-Mini S&P is bullish and trading with a wedge and a ‘hidden’ spike & channel this evening which tells me to be looking for buying opportunities after a deep pullback to the low of the hidden channel or the ‘correction zone’ waiting below.  If price rises without a correction, then I need to be careful buying into the ‘Double-Up’ resistance at 66.0 and wait for a successful breakout-pullback up to the measured-move and prior highs waiting as targets tomorrow.  Don’t forget, the weekly Crude Oil Inventory Report was pushed back until tomorrow (Thursday) at 11:00am EST, and with everything reacting to the moves on Crude Oil these days, we will expect the E-Mini S&P to respond as well.

Gold

Gold is bearish after the buyers tried twice and failed to re-test today’s highs, which tells me to be looking for selling-opportunities as long as we can get a successful breakout-pullback below the measured-move at 62.0 tomorrow.  The buyers had a good run to open the session this morning, which turned into a bull flag and two attempts to go back to the highs.  Once we saw the triple-top at 67.9 you can see the buyers taking profit and all we need now is continuation from the sellers and we’re off to the races to the lows tomorrow.  With that said, I don’t want ignore the buy-side, but we need to get through the falling resistance trend-line and then hold a breakout-pullback above the 67.9 if the bulls have any chance at getting a measured-move target going higher tomorrow.

Euro

Euro is bullish and trading just below today’s high, which tells me to beware buying into the high and look for buying opportunities back at the low of the new trading-range or wait to buy a correction after a test of the measured-move waiting overhead.  The bulls have control on the way to filling the Holiday gap we spoke about in last night’s newsletter but we can’t buy the high so we have to stay patient to wait for the next reliable opportunity.  Sellers have to stay patient as well, knowing that any pullback will be seen as a buying opportunity, the sellers need to see a strong move lower (below the ‘battle zone’) and hold a pullback if they want to take control and make a run back to the lows tomorrow.

FDAX

FDAX is bullish and trying to break free of the flag pattern we saw in last night’s newsletter.  Just as expected, we continue to see buyers at the low of the channel, and we will see more buying opportunities with a successful breakout-pullback above the channel highs.  One thing to keep an eye on is how long this flag has been active.  We don’t normally see flag patterns do more than four (4) tests of the lows, so even though it appears the bulls are just scaling into this move at lower prices, at some point we may see the bottom fall out of this market and make a run back to the range between Christmas and New Years.