December 6, 2010
- in Uncategorized by schooloftrade
Day Trading the News Morning Prep Euro, Crude Oil, Gold and Emini Russell Futures
Daily Prep:
We begin our day this morning with the news:
We begin our day with the dollar index futures:
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– We can see trading back in the bearish price channel from last week
– We dropped out of this channel, found support, and then bounced back up into the bottom range of the price channel
– Knowing how to trade a channel, we expect the price on the dollar index to rise this morning potential as high as 80.360, which is overhead resistance from late last week
– Expecting the dollar to rise, we should be looking for selling opportunities while its moving up.
o The dollar may also run into overhead resistance and bounce back down
o If the dollar begins to drop off new highs, look for short-term selling opportunities
Crude Oil Futures are trading just off the highs from late last week’s run up.
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– We are at the highs of the larger bullish price channel, as well as the shorter term price channel.
– We’re trading sideways from 89.45 down to 88.56, and it looks like we may get better buying opportunities at the support level of 88.56 than selling opportunities below 88.56.
– Expect to buy the bounce off support at 56 first, and then look to sell short if we can break below 88.56 im looking to sell the highs.
– Its very important we remember that the BIG picture says to be a seller, but we’re day traders, so don’t be afraid to buy support on the way back down.
Gold Futures are looking similar to crude oil this morning in regards to its location to the price channel
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– We’re at the highs of price channel, the highs of the trading ranges, and we need to sell these highs below 1411.1
– Just remember we can also look to buy support at 1411.1, but keep in mind in the big picture says to be a seller at the highs
– Expect to see a possible fake-out breakout off these highs
– As a day trader we must remember the big picture shows the long term trend and we day trade the short term trend.
– So the highest probability trades will occur when the short term trend lines up with the longer term trend
Euro Futures are trading at the highs of the price channel, but looking a little confused as for future direction
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– Selling the highs of the price channel is our goal, but we’re already off the highs, so selling now may be a little higher risk.
– We just tumbled off the highs into the middle of the short term price channel
– The middle of the price channel = anything can happen from here
o Buy support @ 3248
o Sell resistance @ 3307
– Swing and position traders will be looking to sell at resistance on the way down
– But short term day traders may get buying or selling opportunities as we move sideways inside of this channel today
– Lets wait and see what happens, read the tape looking for buying support at 3248 and that will tell us who has control
Russell Futures are trading well above the highs of the price channel, so we have a few different options
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– Long term trend says to sell the highs, so position and swing traders will look to for selling opportunities at points of resistance
– Day traders have a lot more flexibility, we can trade against the long term trend for smaller winning trades
o Look to buy at support of 747.1, and as low as 740.5 we will have opportunities to buy the support
o Using the longer term play to the short side, the higher percentage trades may indeed come from selling the highs/resistance
§ So look to sell the highs of 755.8, 747.1, 744.2, and if we break below 740.5 we will sell the highs as well
