January 25, 2011
- in Uncategorized by schooloftrade
Day Trading Gold Futures with Consumer Confidence Economic News
830am EST
– Crude oil futures trading sideways at the highs of the narrow trading range
– We want to sell the highs first off
900am est
– We’ve had pretty slow price action on the markets we trade this morning.
– We’ve had three trades on gold, 1 scratch and 2 winners, but the winners were quite small b/c the markets aren’t moving in wide ranges this morning.
– We have the gold market setting up for a wave short on the 34range chart, but in the process of trigger the trade we are getting chopped up by the 13 and 21 range trigger lines.
– Support from the trigger lines are keeping us from seeing the gold wave short on the 34range wave pattern.
– The crude oil market is also quiet this morning, trading sideways on the 34range chart ahead of the news today.
905am est
– We’re looking at more sideways chop with news @ 900am on home prices coming out as expected.
– Dollar index trading sideways from 78.265 up to 78.505
– We can use the price alert indicator to mark the highs and the lows of the range on the dollar to let us know when the market will be best for trading.
– We can expect both directions on our trades this morning with the dollar trading sideways,
– If the dollar keeps rising im looking to sell at resistance levels on the markets we trade.
– As the dollar hits the highs of this range, expect the dollar to then DROP, which will mean buying opportunities at support levels on the markets we trade.
– Speed is slow on the dollar ahead of the US OPEN
910am est
– Looking at the 13range on the gold we can make some assumptions:
– Short term trend is BULLISH
– We tried to break the PLOD (big level for traders) but the buyers could not get the job done, and you can SEE the exhaustion in the candlesticks wicks at the PLOD.
915am est
– We’re going into the US Market OPEN so be careful, everything higher risk from 915-935am est.
– We see the dollar ATR rising, which is good for our trades later this morning.
– We’ve been watching the gold futures but the price action leaves us concerned about WHO controls the gold market
– We saw lack of buyers when we broke above the previous LOD
– We then saw lack of sellers when we dropped off those new highs.
– Lack of buyers at the highs and lack of sellers at the lows has us waiting for more direction from the dollar, and better speed on the time and sales window.
935AM EST
– The US OPEN comes and goes without making much movement in the markets we trade.
– Gold has opportunity to get long above 1330 and opportunity to get short below 1325
– Tough area on the gold futures after we took our time to define all the trend lines needed for today.
– Crude oil also trading on light volume and slow speed today
– We see a sideways range on the 34range chart of crude oil with us at the highs of the range.
– Sell the highs on the crude oil, looking for a 2step short off the highs on the 4range, wave short on the 21r or 34r or a breaker short on the 13range chart.
945am est
– We appear to have the markets waiting for the 10am consumer confidence news.
– I HOPE we don’t have the markets waiting for TOMORROW’s FOMC announcement.
– We have a concern that traders are sitting on hands until they hear from the FOMC tomorrow…hopefully not…but that’s another concern.
– We notice the crude oil has a price channel INSIDE of a price channel, which is always a sign of a weak market.
955am est
– We took a trade on gold and I made a mental mistake when managing the position.
– I flattened my short trade early when I saw 2 of my 3 rules line up.
– The last rule that DID NOT trigger me to get out of the trade was the BACKGROUND COLOR on the MACD,
– I should have held the trade short until the MACD color turned GREEN (against my short trade position)
– This would have kept me in the trade longer and earned me the money I wanted.
1045am est
– We took our biggest trade of the day on the gold futures earning 39 ticks on the 34 range chart wave pattern failure.
– We noticed that the best trades seem to always come when the SPEED of the dollar is rising.
– Dollar speed = gold speed = more profit
1100am est
– We’ve had a great day trading gold futures
– The crude oil market was flat all day long
– The gold reacted well to the consumer confidence news and gave us another 100 ticks of profit.
– Crude oil has inventories tomorrow, as well as waiting to see the FOMC and GDP news later this week.
– we see slow speed on the dollar (fewer traders in the market, less volume)
– we see falling average true range (narrowing price action)
– Fewer BIG MONEY traders to help get into a trade opportunity.
– We call this time of day the ‘dead zone’ because its after our morning news and before the European close.
– Best thing to do is wait for the dollar to pick up speed around 1130am est (euro close)
