Looking at the news today we are aware that this is Tuesday of OPEX Week, and with the long weekend ahead of us today may be filled with lots of opportunity ahead of Wacky Wednesday.

We see LOTS of news today, very different than monday, so we will be on our toes this morning watching the times before the news, and then waiting to see the market’s reaction to the news so we can trade accordingly.

We also have some members of the Fed talking this morning at 10am EST about the budget, and we will expect to continue to hear from Obama this morning on similar topics as we head into the middle of OPEX.

If you recall, the best way to trade on MONDAY was to wait for the price to speed up, wait for the perfect pattern, and take it with a quick profit target.

We will assume the markets to be the same way this morning UNTIL they tell us differently.

Lets take a look at the chart’s we’re watching this morning…

Dollar Index Futures

The dollar index 34-range chart tells us a lot more than meets the eye.

we have three things to consider on the dollar:

Bullish Price channel in Pink trend line
Major Support (BMT) at 78.349
sideways market from 78.375 up to 78.830

These three things tells us today may be a rough day. When the dollar is in the MIDDLE of the range, and resting on the BMT, this could be a sluggish day if the dollar cant get moving.

we’re in the middle of the price channel so thats the first clue to beware

we have the BMT line (which is flat = long term sideways) and if we rest on the BMT line this basically tells us that the long term dollar traders have no idea for long term direction.

This would be similar to a daily chart with a flat trigger line…the market is searching for answers.

The only good thing we see is the sideways range from 78.735 up to 78.830. We’re at the lows of this range, so that means we expect the prices to rise off these lows.

if the dollar rises off the lows, im looking to sell the highs on the markets we trade this morning.

Crude Oil Futures

Crude Oil futures have continued to put price in a tough spot for us this morning. We also know that crude oil is sharing volume with the 04-11 contract until it rolls forward next week.

Seeing where the dollar was, this should be no surpise. Its amazing how these markets work..isnt it?

three things to watch on the CL 03-11 today:

Strong bearish price channel in pink trend lines
Wedge Pattern from the highs of the channel down to 84.58
Sideways trading range from 86.00 up to 88.00

Keep the Dollar Index Futures Correlation in mind when looking at opportunities day trading crude oil futures today.

if the dollar bounces off support today these lows will likely be tested again on the CL 03-11 so watch closely.

The most important thing to keep in mind is the bearish channel, which means higher percentage trades will likely be SHORT this morning inside the channel.

Buy the lows, sell the highs, and avoid the middle is how we trade a price channel

Then we need to remember the price wedge pattern. The closer we get to the end of the wedge the narrower the price ranges become and the most challenging it is to profit.

Ideally, we want to sell the highs and buy the lows of this wedge, but we should also plan for a breakout.

If price breaks new highs I will Buy a Pullback at support

If price breaks new lows I will Sell a Retracement at resistance

Finally, if price moves up above 86.00 we will be trading in the range above us, so expect price to rise up to test the highs of the range around 88.00.

If we break above 86.00 im looking for buying opportunities because control has shifted to the buyers.

I will look to sell the 86.00 big round number FIRST as overhead resistance, looking to sell the highs and bring price back down into the price channel

Gold Futures

Gold is back to the highs of the price channel after giving us plenty of opportunity to profit from selling the highs late last week and on Monday morning.

Now we see three things to consider today on the GC 04-11 contract

Price Channel in Pink trend lines
Price Wedge in Yellow trend lines
Sideways Range from 1375.0 up to 1393.7

Remember to keep the dollar in mind here as well…if the dollar rises off the support this gold will drop off the highs.

First, im looking to sell the highs of this price channel with a Price reversal pattern. Inside the channel we always sell the highs and buy the lows, avoid the middle.

Next we need to remember that we just broke out of the Wedge Pattern so expect price to try to get back down into that wedge again.

Lastly, if the dollar makes new lows, expect to see the gold test new highs, and if we can get big money buyers above 1375.0 we may be able to hold inside the range above us.

If we see price holding 1375.0 we want to trade this sideways range, so If price breaks new highs I will Buy a Pullback at support. I will not buy the highs, too risky.

I will be careful around the highs, this will be a challenging area, lots of people competing for control @ 1375.0 but look to sell the resistance level first.

Euro Currency Futures

The euro finds itself in the same place it was on monday. the price dropped and tested the major support of 1.3424 as we expected the level held, and that was an excellent buying opportunity on the 6E 03-11 contract.

Now we see the price in the same sideways range from monday, 1.3500 up to 1.3555

We are trading at the LOWS of this trading range, so looking for buying opportunities.

Dont forget the dollar, its at support, so expect a rising dollar to try and push new lows on the euro.

We always trade a sideways market the same way Buy the lows, sell the highs, and avoid the middle.

Lets not forget to buy at support and sell at reistance, and challenge yourself to follow this simple rule.

E-mini Russell Futures

The russell trading sideways at new highs from 820.1 up to 826.1

we have three things to focus on today:

most recent, very narrow sideway range at the highs above 820.1
previous sideways range below 812.7
trend line running up the middle

buy the lows and sell the highs of this narrow trading range, and look to sell the highs of the range below us if we break below 820.1

keep an eye on the trend line in blue as support on the way down

remember to buy support first at 812.7 on the way down, and if we break below 812.7 we are now in the range below us, so look to sell the highs below 812.7.

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