Bad News can’t stop Equities ahead of OPEX | SchoolOfTrade Newsletter 02/20/14

Friday’s News

Tomorrow brings the end
of OPEX, the third week of the month, with options expiring at the end of the
day on Friday.  Traders from around the world will be making
any final adjustments to their portfolios early tomorrow morning, and we expect
the volume to be light tomorrow until the end of the morning when we should see
some volatility kick-up as ‘desperation trades’ hit the tape before end of the
session.

Crude Oil VIP Chart

We’re trading sideways on Crude Oil this evening with our
second day in a row of trading inside the previous day’s range.  This type of market-personality cannot
continue for much longer… other markets are moving like wildfire… so what’s the
hold-up on Crude Oil?

Crude Oil 34 Anchor Chart

We can see Crude Oil pushing into some major resistance around
101.81 up to 104.34, which explains why price-action has been stuck just below
the 103.00 big-round-number this week. 
This 34-anchor chart shows us well-overbought and running into resistance
which suggests that price will move LOWER before it moves HIGHER.

Crude Oil 21 Anchor Chart

The 21-anchor chart of Crude Oil shows us clearly very
bullish.  We can see the bull price
channel, higher-highs and higher-lows, along with a green ‘cloud’ above all the
key moving-averages.  All of these clues
tell me to look for buying opportunities this evening and tomorrow…HOWEVER…I don’t
want to buy at a premium so I will be looking for buying opportunities after Crude
Oil pulls back. 

The 13-anchor chart of Crude Oil shows us the most important
details this evening and into tomorrow. 
We can see 2 bullish price channels on this chart, along with a key buy-zone
down around 102.24-102.11. 

Crude Oil 13 Anchor Chart

I want to buy the lows
of this price channel around 102.60, and will definitely look for buying
opportunities at the 102.24 if we can be so lucky.  I have profit-targets overhead at 103.09,
103.27, 103.62, and 103.98 and all the way up at 104.45.  If price-action moves below 102.11 I will
then look to sell short.

Gold VIP Chart

Gold has been fun to trade this week, even if this price-action
doesn’t make much sense to us right now…who cares…making money doesn’t always
have to make sense!  Today we had a
gap-down at the opening-bell but the US traders scooped it up and pushed it
right back to where the day ended on the prior day, suggesting that we may have
a bullish move back up to 1324.7 on Friday.

Gold 34 Anchor Chart

Gold is trying to push itself through a major resistance zone
overhead right now on the 34-anchor chart. 
We can see resistance up at 1328.6 and 1347.3 is standing in our way if
the buyers want to keep pushing higher.  We
can also see some excellent buying opportunities down at 1285.3 which is not on
a buy-zone but also a key trend-line support level.

Gold 21 Anchor Chart

The 21-anchor chart of Gold shows us more bullish clues this
evening.  We can see the long-term
bullish price channel, but more importantly we can see the buyers have run this
price-action all the way up to the HIGHS and the sellers have started to grab
control after we assume people starting taking profit at these highs. 

Gold 13 Anchor Chart

Gold throws us a “curve-ball” on the 13-anchor chart this evening.  First, we can see the long term bearish price
channel and we are trading at the highs this evening which is a very strong resistance
location on this chart.  Second, we can
see today’s price-action pushed Gold higher above the key moving-averages and
giving us higher-highs and higher-lows. 
These are conflicting clues for this evening so we need to be careful.

Russell VIP Chart

The Mini-Russell has been trading inside the same trading-range
all week since we started after the holiday on Monday.  This week has been incredible for day trading
because you can see that price-action went from top to bottom, then back up to
the top again over the last 3 sessions, giving us ample amount of trading
opportunities during our Live Trade Room.

Russell 34 Anchor Chart

The 34-anchor chart of the Mini-Russell shows us trying to
break through this resistance for a second time this week.  We have a major sell-zone above us at 1159.2
up to 1169.5 along with a resistance trend-line.  I want to be a seller at this trend-line and sell-zone
so I will be watching closely to see how tomorrow’s opening-bell looks and
considering selling short from there.

Russell 21 Anchor Chart

The 21-anchor chart shows us trading higher inside a
long-term bullish price channel so we want to use the LOWS of this price
channel for buying opportunities this evening and into tomorrow.  Look closely and you can see that there is a major
resistance level above at 1162.5 and we just tested it and pulled off the resistance. 

Russell  13 Anchor Chart

The 13-anchor chart of the Mini-Russell shows us the most
useful information for day trading this evening and into tomorrow morning.  First, the bullish price channel tells us to
look for buying opportunities near the lows of the price channel.  Second, we can easily see that price-action is
“overbought” or “priced at a premium” right now so we want to wait for price to
move lower into a position where we can buy at a discount.